Editorial: It's a good Act - but also a bit of a gamble

Stephen Cook, editor

It is, at last, all over bar the shouting. The Charities Bill was conceived four years ago, examined by a joint parliamentary scrutiny committee, passed twice through the Lords and one and a half times through the Commons, and is now on the brink of Royal Assent. So can we give it three cheers?

A wiser response would be to stick to two, at least for the time being.

The Act will provide new definitions of charitable purpose, restructure and modernise the Charity Commission, set up a Charity Tribunal to deal with disputes and give the commission oversight of public fundraising: all good and important stuff, combined with a tidying-up of abstruse charity concepts such as cy-pres. In many ways, charities will be better regulated, and the new law should be welcomed.

But everyone knows that the hardest and most contentious bit was to sort out how the new public benefit test will apply to fee-charging charities such as public schools. The way it was handled in recent days was an object lesson in political power-broking - not pretty, but effective. Ed Miliband has won his spurs as a minister.

But the outcome we have been left with is less than satisfactory. Labour MP John McDonnell had it right in the Commons debate last week, which aficianados should read and savour in Hansard. He said: "My anxiety about the Bill is that, in the best of parliamentary traditions, we have confronted an issue, then avoided it and devolved decision-making to another body."

That other body is the Charity Commission, which will have to consult on, draw up and implement a public benefit regime to deal with charging.

If it denies charitable status to a fee-charger that takes it to court, it will be unable to rely on anything in the Act and will be faced with case law that says, in effect, that fee-charging is irrelevant to public benefit. The courts might take account of modern conditions and of ministerial statements of intention, and they might not. It's all a bit of a gamble.

Just before the debate, Charity Commission chair Dame Suzi Leather helpfully outlined in The Guardian some new ideas about how the commission might take a firm line on fee-charging and public benefit, and briefed parliamentarians. When asked to put some flesh on the bones, the commission says the ideas haven't yet been developed. Developing them and implementing them successfully is likely to be Leather's biggest challenge over the next couple of years.

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