The annual report of the Charity Commission, published earlier this year, contains a section, not present in previous years, entitled Statement of Regulatory Approach. Among other things, this pledges that the commission will "be alert in particular to fraud, terrorist activities, the abuse of vulnerable beneficiaries and to improper politicization." The first three are unexceptionable. The fourth is not quite so straightforward and has triggered a few alarm bells.
The word improper covers a multitude of sins. In recent years some MPs and right-wing newspapers have made it clear that they consider almost any involvement by charities in political activity to be improper – this is the now-familiar stick-to-your-knitting view of the world. But the real test of what is proper or not is to be found in the law (in the form of a series of relevant court judgments over the years) and in the Charity Commission’s guidance on the subject entitled CC9: Speaking Out: Guidance on Campaigning and Political Activity by Charities.
This document was last updated when Gordon Brown was prime minister. The Labour peer and lawyer Baroness Kennedy produced a report calling for a change in the interpretation in the 2004 version of CC9 of the law on charities and campaigning, the touchstone of which was that political activity by charities was permissible providing it was "ancillary" and not "dominant" – words taken from a key 1947 judgment on the subject. The government’s Third Sector Review of 2007 also said the 2004 guidance was not flexible enough, arguing that "it is surely possible, in a well-run charity, for political activity to be "dominant" within a charity and yet still enable it to further its charitable purpose." Perish the thought that the commission acted at the government’s behest, but act it did and the new guidance appeared in 2008.
In many ways it is a great improvement. The earlier version was unclear and risk-averse in tone. The revised version is positive, user-friendly, and in most ways much clearer. It is also more permissive in certain crucial respects. The words "ancillary" and "dominant" have given way to the formulation that "political activity cannot be the continuing and sole activity of the charity." Is the new version compatible with the case law? Over to m’learned friends, some of whom are understood to believe they are not. The question has never quite gone away, and has never been tested in court.
The 2008 guidance, still current, contains a further relaxation in that it says its is permissible for a charity to use most, or even all, of its resources on campaigning for a period of time, providing that does not become permanent. Again, how does this square with the actual case law? One way or another, the feeling is gaining ground that the commission wants to look again at these questions and is contemplating a review of CC9; one reason to believe such a review to be likely is that it would be of a piece with the commission's current (and widely opposed) proposal that charities should have to declare in their annual return how much they spend on campaigning.
Action seems unlikely, however, before the election. There is so much ill-feeling and uncertainty about how the lobbying act will affect charities that even the zealots on the subject of campaigning are probably reluctant to pour more petrol on the fire just yet. But the process might begin with a consultation before the election, and the sector would do well to marshall its thoughts and prepare its position. And after the election – well, like so much else, it will depend very much on the result.