The government has today published its response to the Joint Committee on the Draft Protection of Charities Bill, following pre-legislative scrutiny of the draft bill.
The government has accepted most, but not all, of the Joint Committee’s recommendations and welcomes the Committee’s broad support for the draft bill.
In particular the Joint Committee recommended greater clarity on the operation of some of the proposed powers, and in several cases additional safeguards. We have accepted many of these recommendations.
The government also welcomes the Committee’s support to include 2 measures that were not in the draft bill; a preventive power for the Charity Commission to direct charities not to take certain actions, and extending the power to disqualify a person from being a charity trustee to other positions of responsibility in a charity. Both will now be included with appropriate safeguards.
The measures in the draft bill include:
- banning people with convictions for certain criminal offences – such as terrorism or money laundering – from being a charity trustee
- a new power to disqualify a person from being a charity trustee in limited circumstances and where the Charity Commission considers them unfit
- a new power for the Commission to require a charity to shut down in an inquiry where there has been misconduct or mismanagement and allowing the charity to continue would risk undermining public trust and confidence in charities
- a new power for the Commission to issue an official warning which it could use in less serious cases; the Commission can put this on the charity’s official record and if evidence is found that they have not dealt with the problem then the Commission will take further action
- closing loopholes that have prevented the Charity Commission from taking enforcement action in the past, such as where trustees have in the past resigned in order to avoid removal and consequent disqualification
In addition to the proposed new powers, the Charity Commission is also receiving an £8 million funding injection, announced last October by the Prime Minister, to to help re-focus its regulatory activity on proactive monitoring and enforcement in the highest risk areas like abuse of charities for terrorist and other criminal purposes, such as tax avoidance and fraud.
The draft bill is being amended to reflect the government’s response. Decisions on the next steps for the draft bill will be for the government following the May election.
Minister for Civil Society, Rob Wilson MP said:
I am pleased that we have been able to respond positively to the majority of the Joint Committee’s recommendations on the draft Protection of Charities Bill and grateful to the Joint Committee and the wide range of stakeholders who gave evidence. Their scrutiny has resulted in positive changes to the Bill and is a good example of the benefits of pre-legislative scrutiny.