The Regulator for Charities in England and Wales
July 2005
As the independent regulator of charities the Charity Commission welcomes the Charities Bill and looks forward to working within the modernised legal framework which the Bill when enacted will create. When the Bill was examined by the Joint Committee in the 2004 we gave our views on how public benefit might be treated in the Bill and we think it would be helpful to restate these.
If the Bill is enacted in its current form, it will remove the presumption of public benefit for charities where it currently applies. Apart from that, the current law on public benefit is preserved. The current law is based on decisions which have been made by the courts and the Commission over the years.
In our work with charities we apply the law on a case-by-case basis. Our decisions are based on the existing law and on the circumstances of the particular case including the purposes and activities of the charity in the context of modern society. If the Bill is enacted, our decisions will take into account the fact that there is no longer a presumption of public benefit for certain types of charity. Since both society and the aspirations of what charity seeks to achieve change over time these decisions provide flexibility for the law to evolve and develop. We will consult with the charitable sector and with the wider public on the guidance we produce on public benefit.
In making decisions of this sort we will apply the law in a way consistent with how we anticipate the courts would approach the case. The Commission is answerable to the courts, and will in future also be answerable to the proposed Charity Appeal Tribunal, for our legal decisions. Following a Charities Act, the law on public benefit will continue to be developed by the Commission, the proposed Tribunal and the courts.
In examining public benefit we will apply the broad principles established by the law in light of modern conditions. The current law provides a basis for taking decisions on public benefit but it draws on a very limited number of cases. The charity sector is diverse: charities have a wide range of purposes and seek to achieve them through very many different routes. The law on public benefit applies differently in respect of different charitable purposes. Applying principles drawn from a small number of cases involving particular charities and situations will involve difficult judgements and interpretations of the law to be made by the Commission. Quite rightly, these will be open to challenge.
For this reason we believe that if changes to the Bill are being considered the development of the law would be enhanced if a future Charities Act included non-exclusive, high level criteria, including issues around fee charging charities, which would clarify the general principles established by the existing law to be taken into account in assessing public benefit.