Sir John Major, the former Conservative Prime Minister, has called for the remit and resources of the Charity Commission to be increased and for the regulator to encourage charities to merge where the circumstances are appropriate.
Addressing senior charity professionals at the National Council for Voluntary Organisations’ annual Hinton Lecture in London last night, Major, who is the president of the charity Asthma UK and a patron of several others, said that although he was not an admirer of regulators, it would be wise for the government to expand the Charity Commission’s remit and funding in order to improve the chance of eliminating bad practice and scandals from the sector.
He said he saw advantages in the commission encouraging "friendly worthwhile mergers" between charities, engaging more with organisations, particularly small and regional charities, and becoming a catalyst that encouraged charities to become "transformative as well as palliative".
But he said he had reservations about the view that charities should be encouraged to merge and that people should be discouraged from establishing new charities because he recognised that the urge to set up a charity was usually "driven by the heart, not the head".
He said it would be folly to lose the enthusiasm of small charities by forming them into larger entities and that "small charities often offer small, anonymous acts of kindness vital to the recipient that may be overlooked by their more business-like larger brethren".
Major told delegates that charities should be concerned about the rise of society lotteries and so-called "betting-on" lotteries, which enable people to bet on the outcome of other lotteries. He said these threatened the future of the National Lottery, which he established in 1994.
He said society lotteries had circumvented the legislation governing the National Lottery and paid a far smaller proportion of their income back to worthy causes, while betting on lottery operators was blurring the lines between lotteries and outright gambling.
Asked by Martyn Lewis, chair of the NCVO, what he would do if he were in government about the struggle charities faced to secure local government contracts against commercial competition, Major said that if local authorities were to be encouraged to issue contracts to small charities, a form of insurance would have to be put in place to allow an to recoup its costs if a contract was unfulfilled.
He said that the insurance could be provided by the Charity Commission or the government and funded by a "tiny levy" on all charities.
"There are ways like that in which one can do it," he said, adding that it seemed a shame to lock charities out of local authority procurement processes.
Major said that few things made him prouder about Britain than the nation’s charity sector, but the nation could not be complacent about it. He said that charities had a duty to protect their reputations and "unless they are seen as efficient and well run, donations will fall away".
He said it should be remembered that giving also tended to fall when the burden of tax was too onerous.
Major, who served as Prime Minister from 1990 to 1997, also spoke of how he introduced Gift Aid in 1990, saying this had raised £13.5bn in income for charities since then.
Lewis said after the lecture that "much, if not all" of what Major had said tied in with the umbrella organisation’s own thinking.