Paula Sussex, the former chief executive of the Charity Commission, has issued a plea to the government to give the commission the funding it needs to survive or allow it to charge charities.
Sussex stepped down as chief executive of the commission last week, but in a piece that appeared on the Financial Times website yesterday, describing her as the outgoing chief executive, she warned that the charity sector could go from being one of the country’s greatest strengths to a vulnerability if the regulator was not properly funded.
Sussex led the commission for three years, but stepped down after deciding not to renew her contract and was replaced by Helen Stephenson, a former director of the Office for Civil Society.
Cuts to the commission’s Treasury funding mean its budget has fallen by £8m since 2010 and has approximately halved in real terms over the past decade. It will be frozen at £20.3m a year until 2020.
In her article, Sussex said a one-off grant from the Treasury three years ago had allowed the commission to improve the support it gave to charities, but this should not mask the "precariousness" of the commission’s financial situation.
The regulator was "significantly overstretched" and because of huge cuts "there are no further savings to be made" without threatening the regulatory model and forcing it to choose between the services it offered, she said.
"It is for these reasons that I make a plea to government: give the commission the funding it needs to function in the future or, failing that, grant it permission to seek a small contribution from the organisations it oversees," she said.
The commission has been calling for charities to contribute towards its funding for a number of years and, in January, William Shawcross, the regulator’s chair, said he hoped a consultation on possible models for charging charities would be launched by the end of the month.
Third Sector understood that the commission was waiting for the Treasury to sign off the consultation, and in March Sussex and Shawcross said in a joint letter to the House of Lords Select Committee on Charities that approval had been granted.
But the consultation has still not appeared.
A Third Sector poll conducted in May this year found that only 22 per cent of 225 respondents were in favour of charities funding the regulator, while 78 per cent were opposed to the charge.
In her article in the FT, Sussex said: "Charities themselves should weigh the pain involved in making a modest contribution towards the costs of an effective commission against the potential price to pay in years ahead if a weakened regulator fails to uphold the public trust on which they depend."
The Department for Digital, Culture, Media and Sport, which houses the OCS, did not respond to a request for comment before publication of this story.