News Analysis: Looking back on an annus hecticus

The Charity Commission's AGM presented an upbeat account of the regulator's past year.

Dame Suzi Leather opened the annual general meeting of the Charity Commission last week by saying it had been an "annus hecticus". The implementation of the Charities Act and continuing budget pressures have certainly made for a full year for the regulator and its chair.

But presentations made to the 60 or so delegates at the meeting painted an upbeat picture of how things are going at the commission. Leather said that the profile of the sector had rocketed in the past year, and Andrew Hind, the commission's chief executive, presented research findings showing that the commission had improved its reputation among its stakeholders.

Judging by feedback from delegates, the commission is indeed enjoying a new level of appreciation. Even some of its long-standing sceptics seem pleased with the regulator's progress. "We feel that the commission is on the right path under the leadership of Dame Suzi and Andrew Hind," says Belinda McKenzie, coordinator of the Association for Charities, which was established in 1999, partly in response to dissatisfaction with the commission. "Some more work needs to be done, but it has improved."

What about public benefit?

But the subject on everyone's lips at the AGM was the public benefit test. The commission was due to publish its guidance on the matter this month but, because of the large volume of responses the consultation generated, it was unable to meet its indicative timetable (Third Sector, 3 October).

Jane Hobson, the commission's head of policy, indicated that a lot of the feedback had come from faith-based organisations worried about the implication of the test for their status. Others asked for clarification about the use of certain words.

Hind denied that the delay was a sign that the regulator is struggling to cope with its workload under its budget constraints.

"This has nothing to do with resources," he said, in answer to a question from the floor. "Having more than 900 responses is good news and it deserves the kind of considered response we're giving it."

In fact, the commission was adamant that the 5 per cent budget cut it expects in the Treasury's Comprehensive Spending Review would not affect its service delivery.

"Even with declining budgets since 2004, we have produced better services for charities and the public at large," Hind said. "It's about being creative and working more efficiently."

What senior members of the commission failed to mention at the meeting, however, was that an internal staff survey showed these budgetary pressures had taken their toll on employee morale. According to the research, less than half of the commission's staff were happy at work (Third Sector, 26 September).

Nick Allaway, executive director for charity information and corporate services at the commission, says the regulator was disappointed by the results of the survey and agrees there is a gap between how it is doing externally and internally. Staff numbers have fallen by 18 per cent since 2004 and further budget cuts are likely to lead to more redundancies.

But perhaps the biggest elephant in the room at the AGM was Leather's decision to pull out of discussions on the public benefit of independent schools because her daughter attends one. Nobody brought up the fact that her decision had come after the public benefit guidance had been drafted and put out for consultation. Neither did anyone mention that six of the nine board members went to private schools.

Tony Mitchell, national executive member of the Campaign for State Education, says it is the preponderance of privately educated board members that worries him, because only 7 per cent of pupils go to private schools. "It must be hard for them to be neutral and there is a risk they might actually go against the private sector for fear of being seen as unfair," he says.

The commission's stance, as so far reflected in the press, would certainly suggest that it will be tough on schools that refuse to cooperate. But Hind was at pains to reassure delegates to the AGM that the regulator would approach the matter with its often-cited proportionate approach.

The commission might have had a good year - but if 2007 was hectic, 2008 is likely to be even more trying. The public benefit test will come into force; thousands of previously excepted and exempted charities will be required to register; and the charitable incorporated organisation will enter the fray as the new star of legal forms.

Most of all, the commission will be pushed to demonstrate that it can, in the words of its chair, "do more with less".

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