Transparency data

Whistleblowing disclosures made to the Charity Commission for England and Wales 2017-2018

Published 28 September 2018

This report is about the disclosures made to us as a prescribed person, what we did with the information in the disclosures and how they contributed to the impact of our regulatory work.

It also explains the plans we have to improve the services we provide for whistleblowers in 2018-2019.

1. The statutory framework

The Charity Commission is a ‘prescribed person’ under the Public Interest Disclosure Act 1998 (PIDA), which provides the statutory framework for employment protections for charity workers who make a qualifying disclosure (or ‘blow the whistle’) to us about suspected wrongdoing, including crimes and regulatory breaches by their employer.

2. Our functions, objectives and powers

The Charity Commission is the registrar and regulator of charities in England and Wales. Parliament has given us 5 statutory objectives which are to:

1. increase public trust and confidence in charities
2. promote awareness and understanding of the operation of the public benefit requirement
3. promote compliance by charity trustees with their legal obligations in exercising control and management of their charities
4. promote the effective use of charitable resources
5. enhance the accountability of charities to donors, beneficiaries and the general public

Our general functions include:

• determining whether or not institutions are charities
• encouraging and facilitating the better administration of charities
• identifying and investigating apparent misconduct or mismanagement in the administration of charities and taking remedial or protective action in connection with such misconduct or mismanagement

The full list of our general functions is set out in section 15 of the Charities Act 2011.

We also have a range of statutory powers which include:

• information gathering powers, which enable us to obtain information or documents, or require named individuals to meet us and answer questions
• temporary protective powers, which allow us to protect charity property for a temporary period while we continue investigating
• remedial powers which allow us to implement long-term solutions to problems often identified by an inquiry

The Charities (Protection and Social Investment) Act 2016 introduced a number of new powers to enable us to address and remedy abuse within charities. Examples include powers to disqualify individuals from trusteeship, issue official warnings and to direct trustees to take or not take specific actions.

3. Our approach to whistleblowing disclosures

Our aim is to make it straightforward for charity workers to bring concerns covered in PIDA to our attention. It is important that they feel able to speak up about a serious wrongdoing they have identified.

We understand how difficult it may have been for them to bring a matter to our attention, and its importance to them. We recognise the value of this information, as workers will have a unique insight into how a charity is operating on a day to day basis.

These disclosures provide us with information that will help us fulfil our regulatory duties.

4. Assessment and case handling

Our regulatory approach is set out in our Regulatory and Risk Framework.

This helps ensure that the Commission’s regulatory engagement with charities is proportionate, accountable, consistent, transparent and targeted as required by the Charities Act 2011.

While the framework is written for the wider public, it may also be useful for charity workers when considering making whistleblowing disclosures to the Commission.

When we receive a whistleblowing disclosure we consider the information and prioritise which action to take according to the nature and level of risk. Our initial assessment will depend on what we are told and the severity of the matter.

5. Whistleblowing facts and figures 2017-2018

We received 101 whistleblowing reports from charity workers in 2017-2018, and 88 reports in 2016-2017.

All received an initial assessment and of these:

• 82 reports were identified as potentially needing some regulatory action
• 19 were considered as low risk
• 51 cases have been closed

When we complete a case we record what we have done by allocating outcome or impact codes that indicate the action we have taken. But more than one outcome or impact code can be used for each case.

From the 51 cases we have closed:

• 39 indicate some form of regulatory activity or advice, for example providing general guidance or verifying that trustees are acting correctly
• 15 indicate a higher level of regulatory activity, for example providing corrective advice for trustees to act upon

The codes recorded fell into the following broad categories and showed:

Action we took	Number of cases
Advice for trustees	27
Decided there was no issue to take forward or established that the trustees were dealing with it	21
Corrective advice provided	2
Signposting or waiting for action from other body	5

Charity Commission actions led to the following	Number of cases
Trustees are aware of their duties	32
Reassurance received that trustees are dealing with or have resolved issues	14
Actions led to improvements in areas of charity’s work	17
Concerns looked into and not substantiated	9
The charity’s beneficiaries, reputation and/or public trust was protected	7

5.1 Charity type

The nature of the charities that we received reports about varied. Each charity has particular classification codes to show what its primary purposes are.

Table shows the charity classifications that we received the most reports about.

Charity type	Percentage
Disability	16%
Education/Training	12%
Advancement of health/saving lives	10%

5.2 Nature of issues raised

Table shows the number of reports received over the last 4 financial years.

category	2014-15	2015-16	2016-17	2017-18	total
governance	33	63	57	60	213
safeguarding issues	8	10	15	24	57
fraud/money laundering	3	0	11	8	22
theft	2	5	1	5	13
other	2	4	1	2	9
criminality	1	3	0	0	4
sham charity	1	2	1	1	5
terrorism	0	0	1	1	2
blank	0	0	1	0	1

When opening a case we record the nature of the issue that is raised with us. The most reported issue categories were governance issues, safeguarding, fraud and money laundering.

Table shows the nature of whistleblowing reports by employees that were reported to us in 2017-2018 (total 101 reports).

Nature of whistleblowing reports 2017-2018 (employees)	Number
Governance issues	60
Safeguarding	24
Fraud or money laundering	8
Theft	5
Other - including other types of criminality	2
Charity set up for criminal purposes	1
Links to terrorism	1

Governance issues cover a wide range of situations which can have a damaging effect on the management and administration of a charity. They can include breaches of a charity’s trusts or laws, lack of financial controls or unauthorised trustee benefits.

6. The impact on our work

The reports we have received from whistleblowers this year have helped us to:

• initiate investigatory activity
• take action to protect charities beneficiaries, assets, work and reputations and, more widely, public trust and confidence in charities and the charitable sector
• identify other governance issues not raised by the report and ensure these are addressed
• ensure charities are complying with their safeguarding duties
• use our statutory powers to put charities back on track, including giving regulatory advice to trustees to make them aware of their duties and responsibilities, and ensure they make significant and necessary improvements to their charity’s governance

Whistleblowing disclosures help us detect and prevent concerns within the sector and take steps to put these right. They help create more effective and efficient charities and more generally assist in raising the public’s trust and confidence in charities and the charitable sector.

7. Our plans for improvement

We have taken account of feedback and, as a result, we have reviewed our guidance and processes and committed to several improvements.

7.1 Improved guidance

There will be new guidance for potential whistleblowers which will support a more streamlined process for making a disclosure to us.

This will make it easier for them to bring their concerns to our attention. It will also provide clearer explanations about when to approach us and what information we require.

7.2 Enhanced assessment, case handling and reporting

We will put improved processes in place for our handling of whistleblowers and their disclosures both during our initial assessment of reports and at the conclusion of any cases that we subsequently open.

We will also improve our approach to recording whistleblowing disclosures to provide us with better analytics. This will help us provide more detail to the public about the disclosures we receive and will also inform further developments to our approach to handling them.

7.3 More training

Working with a specialist organisation, we will arrange training for our staff to improve how we recognise disclosures and handle whistleblowers.

7.4 A whistleblowing helpline

Again, by working with a specialist organisation we will pilot a helpline which will provide an extra service to advise potential whistleblowers.