The governance of the Charity Commission has been problematic ever since the Charities Act 2006 changed its structure and gave a board of up to eight members the power to decide whether it or the executive staff should carry out any particular function. This allows the board, in effect, to intervene whenever it chooses in matters being considered by the commission.
Until 2012 this did not emerge as a cause for concern. The members of the board were, by and large, people who knew and cared a lot about charities and were not particularly interested in wider ideology. This changed somewhat when William Shawcross, a writer interested in geopolitics and the global threat of terrorism, was appointed chair.
He recruited a new board that included members with a more ideological bent. Orlando Fraser QC is a former Conservative candidate, for example; Gwythian Prins is a sceptic on climate change and an opponent of UK membership of the European Union. And the impression has gained ground that the board is more inclined than before to step into operational matters, especially if they have a political flavour to them.
The most public example of this was during a judicial review of the commission’s actions last year, when emails were disclosed that showed the extent of board involvement in the question of grants by the Joseph Rowntree Charitable Trust to the controversial group Cage, which advocates for what it calls victims of the war on terror.
It is hard to know definitively the extent of such interventions, which is why the commission would do well to publish in full a recent review of its governance that, presumably, looked at the detail of this. It has published only a summary, confirming that the board has the authority in law to intervene directly in operational matters and remarking enigmatically that "there is risk of a disconnect between the board and the rest of the organisation".
Had the review found nothing contentious about the commission’s governance, it would no doubt have been published in its entirety. But the fact that it is being withheld under an exemption in the Freedom of Information Act for material likely to inhibit "the free and frank exchange of views for the purposes of deliberation" suggests that there was some disagreement or contention, the exposure of which would be potentially embarrassing.
The matter of the commission’s governance, and the related question of political impartiality, has now been taken up with the charities minister, Rob Wilson, by Sir Stuart Etherington, chief executive of the National Council for Voluntary Organisations. Etherington asserts that the current governance arrangements "and the appointment of certain individuals" have reignited a debate that must be urgently addressed.
How likely is the government to respond to this? It could choose to legislate for a new commission structure, but it has just brought in a new law on charities and, even if it agreed with Etherington’s arguments, more legislation seems unlikely. Alternatively, it might be possible without legislation to change the system for appointing board members and give parliament a greater role in the process, as the NCVO has suggested.
A third way might be to address the matter indirectly through the existing appointments process. Five commission board members reach the end of their three-year terms in the next two months, including those who have been the most forceful in the assertion of the board’s pre-eminence. It is up to Wilson whether to reappoint them, oblige them to compete if they wish to continue, or stand them down. He is empowered to nod them through, providing their performance is considered adequate by Shawcross.
What he will do is hard to predict. On the one hand, the government is pleased with the commission’s undoubted progress in reforming its processes and procedures and becoming a more robust regulator, and might not be in the mood to respond to Etherington’s concerns. On the other, the EU referendum might cast a shadow over the decision, as over most of current politics.
The commission has issued guidance that, even when revised after protest from the sector, discourages charities from participation in the campaign. There has also been a complaint to the commission about an anti-EU article written by Prins. Wilson, by contrast, wants the UK to stay in the EU and told the NCVO’s annual conference this week that he welcomed the fact that "charity voices can and will be heard in the EU debate".
How this will play out remains to be seen. But if the concerns of sector leaders about the regulator are not taken on board, either in the reappointments or perhaps in some perceptible rebalancing of the commission’s general approach, it may well be interpreted as a two-fingered salute.