Editorial: Public benefit handed back to the lawyers

Stephen Cook, editor

Is the Charity Commission about to receive a hospital pass from the Government? For those unfamiliar with rugby, the term is used if a player is thrown the ball when an 18-stone forward is close enough to flatten him the moment he catches it.

The question arises because it now looks virtually certain that ministers will not accept an amendment to the Charities Bill to say the commission should take account of "any undue restriction" on the public benefit provided by charities when it sets about the task given to it in the Bill of deciding whether they provide sufficient benefit to justify charitable status and tax advantages.

The amendment is designed, of course, to strengthen the commission's hand when assessing fee-charging charities, including public schools.

Until last week the amendment, backed by 30 or 40 Labour and Liberal Democrat MPs, was also being urged upon third sector minister Ed Miliband and his immediate boss Hilary Armstrong by the NCVO, and - more discreetly - by the commission. The NCVO still says the amendment would be preferable, but has accepted that ministers have gone as far as they can and says two other developments will compensate for the amendment: these are the latest, more robust noises coming from the commission and a ministerial pledge to review the act after three years rather than five.

The commission, meanwhile, says that its more robust noises about how charities could account for their public benefit (see News, page 4) are an attempt to reassure Parliament that, even without the amendment, it will address public benefit vigorously.This conjunction of events has proved most convenient for the Government. Indeed, some MPs say ministers are cock-a-hoop.

And why have they not budged? Their argument invokes the risk of unintended consequences, meaning the amendment might catch charities that do provide public benefit but are unable to prove it. Some, meanwhile, continue to believe there is an edict from Downing Street to avoid anything the press could present as an attack on public schools.

Back to the hospital pass. Without the amendment, the arguments on public benefit will be drawn entirely from case law - which, according to charity lawyers, says, in effect, that fee-charging is irrelevant to public benefit.

So if the commission denies charitable status to Notcheap Prep School, which lodges an appeal with Mr Justice Cocklecarrot (Eton and Oxford), the outcome might be an unintended consequence of a rather different kind.

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