Regulator opens inquiry into Public Safety Charitable Trust

Charity Commission inquiry launched after the trust lost a High Court case last month over underpaid business rates

Charity Commission
Charity Commission

The Charity Commission has opened a statutory inquiry into the Public Safety Charitable Trust, the charity that lost a High Court case last month over unpaid business rates.

The commission opened an investigation into the charity in October 2011 over concerns about business rates relief, and opened an inquiry on 21 May this year after the PSCT lost its legal dispute with three councils on 14 May.

The PSCT leases commercial premises, which would otherwise be subject to non-domestic rates, for a nominal rent and installs technology in the properties to transmit public safety text messages to mobile users in the vicinity. It is believed the charity holds about 2,000 leases in 240 local authority areas.

Charities receive mandatory discounts of 80 per cent on business rates if the property is used wholly or mainly for charitable purposes, and councils can offer a discretionary discount on the remaining 20 per cent.

But three councils – South Cambridgeshire, Milton Keynes and Cheshire West and Chester – disputed giving the PSCT the mandatory discount, arguing that the properties were not wholly or mainly used for charitable purposes.

As a result of the High Court judgment, the councils said, the charity would have to pay about £1.8m in unpaid business rates and costs. The charity’s accounts for 2011 show it had an income of £1,665,046 and spent all but £45,000 of that sum.

In a statement made yesterday, the commission said it had opened the statutory inquiry two weeks ago as a result of concerns raised by the High Court judgement.

A spokeswoman said: "it is our normal procedure to let the trustees see and have an opportunity to comment on our press statement about the opening of the inquiry before making the inquiry public."

The statement said the purpose of the inquiry was "to examine regulatory concerns including whether the charity trustees have properly discharged their trustee duties when making decisions to enter tenancy agreements and occupy those properties to further their charitable purposes, and whether any benefit to the landlord or other parties is incidental to that".

The commission said it was also aware there would be further court proceedings involving the charity as a result of the court judgment.

Mark Ferguson, chair of the PSCT, said the charity had been answering questions from the commission for almost two years and the commission had not questioned any of those answers. "I have been completely open and transparent in everything I have done," said Ferguson.

Ferguson said the charity had done some powerful work in the past, including having mobile messages accepted by 2.3 million people when it worked with the charity Crimestoppers. He said the trust would attempt to carry on working during the commission’s inquiry.

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