This is an open question for discussion - which of the following views do you tend to agree with more, and why?
a) Charity trustees should be left to make their own decisions on issues such as trustee payments or selling land
OR
b) Proposals by charities, such as selling land or making payments to trustees, should be carefully considered by the Charity Commission and be subject to its approval
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Light touch regulation is generally more effective than close control. Set clear commonsense rules, make appropriate checks on compliance and take sanctions against trnsgressors. This is much cheaper to operate and more effective than a bureaucracy that tries to stop charities making mistakes by requiring permission for every step.
ReplyDeleteCurrent law and Commission guidance is clear and I think worthwhile, if not universally known. I suggest having set thresholds over which Commission approval must be obtained and under which approval may be sort, as well as the current de minus figures.
ReplyDeleteThere is a strong argument for making making of the legal transactional work such as selling land and changing objects etc discretionary i.e. the charity should notify the Commission of their intent and the Commission will reserve the right under its risk framework to authorise or refuse to but this would be time limited i.e. if the Commission does not reply after a certain time then "they have no objection". This ensures that there is no free for all, zero regulation but "enable" low level/low risk transactions to go through swiftly.
ReplyDeleteThresholds for approval for Trustee expenses and land sales are a good idea. Rules need to be put in place to avoid charities misusing this approval regime. For example by selling land in 'plots' to fall below the threshold. This could become more of a problem if the registration process is made easier.
ReplyDeletea)
ReplyDeleteSelling land b), trustee payments a). There is already a whistleblowing procedure in place for Independent Examiners and Auditors to notify CC if they have concerns about application of funds.
ReplyDeleteThe Charity Commission should put a clear advisory framework in place and update this as practice requires. Within this I would suggest intervention by exception rather than as the norm. The links with the above concept of the Charity Commission being a key enabler through the regulatory advice that it provides to charities.
ReplyDeleteSo, allow Trustees to always be autonimous when it comes to the disposal of land? What happens the next time a local council, acting as Trustee for a piece of public land, such as a park or village green etc, decide to sell the land and redirect funds into the councils statutory funds being under the missguided impression that it is theirs to sell? It has happened before.
ReplyDeleteSo a charity can change its own objects without anyone to consider whether or not the objects they are to change to are even charitable in nature or not? Thats a good idea, we can have all sorts of political organisations running around registered as charities that started life as an animal rescue shelter...
ReplyDelete