Charities (Protection and Social Investment) Bill [Lords]
(8 years, 11 months ago)
Commons ChamberRead Hansard Text Read Debate Ministerial Extracts
Mr Speaker
Before I ask the Minister to move the Second Reading of the Bill, I need to say the following. I remind the House that I have certified the Charities (Protection and Social Investment) Bill under Standing Order No 83J in relation to England and Wales. I further remind the House that this does not affect proceedings in the debate on Second Reading, or indeed in Committee or on Report. After Report, I will consider the Bill again for certification if it has been amended, and the relevant Legislative Grand Committee will be asked to consent to certified provisions.
The Minister for the Cabinet Office and Paymaster General (Matthew Hancock)
I beg to move, That the Bill be now read a Second time.
Every hon. Member will know of a charity or charities doing extraordinary work in their constituency, as will you, Mr Speaker. Many have served or will serve as patrons or trustees. They may even have subjected themselves to ritual humiliation to raise money and awareness. I have dressed up as a sumo wrestler, carried a pedometer for a week and even lost two stone to race a charger around the Newmarket July course. Charities channel the best of our instincts against the worst that life can inflict, whether that is sickness of mind and body, entrenched poverty or natural disaster.
So often, charities lead the way for us in Government to follow. Long before there was an Education Act, an NHS or a welfare state, charities that knew people could not wait had set up hospitals, schools and almshouses. Today, their compassion and kindness are matched by ideas and innovation. When Paula and Robert Maguire posted their first ice bucket challenge video, they expected to raise about £500 for the Motor Neurone Disease Association, but the campaign went viral, many of us joined in and they ended up raising £7 million. Let us look at Bristol Together, a social enterprise that buys and refurbishes properties and employs ex-offenders to carry out the work: that social investment is transforming lives.
The Government are committed to a flourishing civil society. We have protected the budget of the Office for Civil Society, we are expanding the brilliant National Citizen Service and we are rolling out more locally designed social impact bonds. Along with those opportunities, there are challenges. Perhaps more than any other kind of enterprise, charities trade on their reputation. Scandals of poor governance or unscrupulous fundraising undermine public trust, tarnishing the vast majority of charities that are well run and seek only to do good.
Sir Edward Garnier (Harborough) (Con)
I could not agree more with the opening remarks of my right hon. Friend in describing, to use an awful expression, the charitable landscape. I am a patron of Unlock and a trustee of the Prison Reform Trust. Both organisations have concerns, which I hope he can allay, that this much needed legislation might make it more difficult for them—bearing in mind that the subjects that interest them are prisons, prison reform and the condition of prisoners—to have among their trustees people with criminal convictions. The point is obvious, but I am sure that he can deal with it.
Matthew Hancock
My right hon. and learned Friend. If he would like to raise it any further, I could continue. I commend the two charities of which he is a trustee for their work. While protecting charities through the Bill, we will of course seek to support the good work that excellent charities do. The Bill proposes extra restrictions for those with unspent convictions. However, the Charity Commission will be able to waive those restrictions and, as with almost all the extra powers of the Charity Commission, it will be possible to appeal to the charity tribunal. I hope that he is reassured by the safeguards that are in the Bill, and that we can work with him to ensure that they are applied properly to charities that work in the important area he mentions.
Sir Edward Garnier
My right hon. Friend has been extremely clear and helpful. May I make him an offer? I know of his success at Newmarket racecourse. There is a very good racecourse, Leicester racecourse, in my constituency. If he would ever like to run there, he should let me know.
Matthew Hancock
I very am grateful for that unexpected invitation. I am dearly tempted. I hope that Unlock and the Prison Reform Trust will work with us to ensure that the Bill passes in a form that supports the important work that they do.
On the broader question of supporting the reputation of charities, by one measure trust in the sector is at a seven-year low. It is in all our interests that we have a strong, confident and thriving charitable sector.
The purpose of the Bill is twofold: first to tackle the challenges and then to unlock new opportunities. The main provisions of the Bill fall into three main areas: first, strengthening the Charity Commission’s powers, including over trustee disqualification; secondly, the regulation of charity fundraising; and, thirdly, the new social investment power for charities.
Let me turn to the Charity Commission’s powers. The purpose of the Charity Commission is to ensure that each of the 164,000 charities in England and Wales pursues its charitable objectives. Set up in 1853, it has done a century and a half of good work, but two years ago the National Audit Office and the Public Accounts Committee found that it was failing in its core duty. In particular, they found that it was not doing enough to tackle the abuse of charitable status. The NAO made a series of recommendations to improve the commission’s effectiveness.
The coalition Government published proposals for new powers based on those recommendations. Following a public consultation, the draft Protection of Charities Bill was published. Pre-legislative scrutiny and the Bill’s passage through the House of Lords have resulted in further refinement. I thank all the Members, peers and others who have improved the Bill that is before the House today. These measures are just one part of a wider programme of reform, aimed at turning the Charity Commission into a tough, clear and proactive regulator.
Mr Jenkin
It pains me to point out that my right hon. Friend has left out the significant post-legislative scrutiny of the Charities Act 2006 that was conducted by my Committee, the Public Administration Committee, in the last Parliament, which was the prime precursor of this Bill. I also sat on the Joint Committee that performed the pre-legislative scrutiny of the Bill.
Will he say something about recent controversies, for example those around charitable fundraising? The Select Committee is very frustrated that we are conducting significant inquiries that the regulator, the Charity Commission, should be conducting, but it does not necessarily have the power to hold its hearings in public in a way that would demonstrate its regulatory role.
Matthew Hancock
I was going to come on to the work of my hon. Friend and his Select Committee in making sure that the Bill is in the best possible shape. I am very grateful for the work that he did at the end of the last Parliament, after the National Audit Office report, to make sure that when we had a Bill, it gave the commission the necessary powers.
We believe that the Charity Commission has the power to convene meetings in public. However, I recognise that there is a question over whether it does so. During the passage of the Bill, we will look at that point in more detail. We are prepared to accept amendments, if they are necessary to bring clarity on the point that my hon. Friend raises.
Dr Andrew Murrison (South West Wiltshire) (Con)
I agree with my right hon. Friend that pre-legislative and legislative scrutiny are extraordinarily important in this place. Will he observe, for the record, how much legislative scrutiny is being performed by Her Majesty’s official Opposition, since there are precisely no Opposition Back-Bench Members in the House?
Matthew Hancock
I hope that this Bill can unite both sides of the House. I welcome the hon. Member for Redcar (Anna Turley) to her place. My hon. Friend has made his point very clearly and it will appear on the record, but I do not want to get into an unnecessary dispute with the Opposition, given that I hope we will have all-party support for this important Bill which will strengthen the role of the Charity Commission and, ultimately, be in the best interests of charities throughout the land.
As I said, we want to provide a tough, clear and proactive regulator. Under the strong and capable leadership of William Shawcross and Paula Sussex, there has been a direct focus on tackling abuse and mismanagement. However, an effective regulator needs to have teeth. As the NAO reported, the commission needs our help to address the “gaps and deficiencies” in its legal powers. The Bill will close those gaps in the commission’s capabilities, as well as tackling a number of damaging loopholes in charity law.
Let me briefly outline the five new powers that the Bill confers. These powers will help to protect the public, the staff and the people our charities serve from those who would seek to exploit them. First, the Bill will extend the automatic disqualification criteria. Currently, the focus of the law is on barring people who have misappropriated charitable assets, but the criteria are far too narrow. We will extend them, as my right hon. and learned Friend the Member for Harborough (Sir Edward Garnier) said, to include people with unspent convictions for money laundering, bribery, perjury or misconduct in public office, those on the sex offenders register, and those convicted for terrorism offences, including individuals subject to an asset-freezing designation.
Secondly, the Charity Commission will be given new powers to disqualify in instances where an individual has behaved in a way that makes them unfit to be a charity trustee, acting on a case-by-case basis and using its judgment and discretion. That new power is essential to empower the Charity Commission to tackle those who would bring charities into disrepute, and I hope that it will be used with care and decisiveness.
Thirdly, the Bill gives the Charity Commission a new official warning power in response to low-level misconduct. That will allow a more proportionate approach for less serious cases. Fourthly, the Bill grants a new power that allows the Charity Commission to direct the winding up of a charity following a statutory inquiry. That would apply if the commission proves that a charity is not operating, or that its purposes could be promoted more effectively by ceasing to operate, and that to do so would be in the public interest. We expect that power to be used in limited circumstances, and it is subject to several safeguards.
Fifthly, the Bill closes a loophole that allows offending trustees to resign before they are removed by the commission, and then act as a trustee for a different charity without fear of repercussion. That will ensure that trustees are no longer able to escape accountability if they abuse their position of trust. As with all the commission’s existing powers, all five of those proposals would be subject to the general duty to have regard to best practice. With the exception of the official warnings power, all the commission’s new powers are subject to a right of appeal to the charity tribunal.
All five measures that I have outlined are essential to protecting the interests and reputation of the vast majority of charities that are run by people of great integrity. The Charity Commission was closely involved in developing the powers, and it fully supports them. In addition, independent research for the Charity Commission found that 92% of charities supported new, tougher powers for the regulator.
We also intend to remove clause 9, which was added on Report in the Lords. We have serious concerns about the unintended consequences of that clause, as it attempts to encompass complex case law into a single statutory provision. It would also impose a major new regulatory responsibility on the commission. Clause 9 was not proposed because of concerns about charities in general, but in a narrow attempt by the other place to undermine the Government’s manifesto commitment to extend the right to buy. It is regrettable that a Bill with widespread support was used in that way, and we cannot allow that to stand. I urge the House to reject that anomalous clause and consider the matter elsewhere.
The challenge of regulating charity fundraising has already been mentioned. We can be incredibly proud that we are one of the most generous countries in the world when it comes to charitable giving, but although people are happy to give, they do not want to be bullied or harassed into doing so. A voluntary donation must be voluntary. Earlier this year we heard about the tragic case of Olive Cooke, Britain’s longest-serving poppy seller. For years, she was targeted with hundreds of cold calls and requests for money. More than 70 charities bought her details or swapped them with other charities, and in one month alone she apparently received 267 charity letters. Sadly, since then more cases of unscrupulous fundraising practices have come to light, and we must act.
We began by asking Sir Stuart Etherington to review the regulation of fundraising over the summer, backed by a cross-party panel of peers, and I thank them for their work. Sir Stuart recommended a new, tougher framework of self-regulation, and we are working with charities to deliver that. Lord Grade of Yarmouth will chair the new independent body at the heart of that framework. It will be paid for by large fundraising charities, and it will be able to adjudicate against any organisation that is undertaking charity fundraising. The body will be accompanied by a fundraising preference service—similar to the telephone preference service—which will give the public greater control over their consent to receive charity fundraising requests.
Next, we will prohibit contractors from raising funds for a charity unless the fundraising agreement between them explains how the contractor will protect people from undue pressure, and sets out how compliance will be monitored by the charity. It will require large charities to include a section in their trustees’ annual report on the fundraising undertaken by them or on their behalf. That will include an explanation of how they protect the public in general, and vulnerable people in particular, from undue pressures and other poor practices.
Mr Jenkin
The Public Administration and Constitutional Affairs Committee—or PACAC, as we call ourselves—is concluding an inquiry into charitable fundraising, alongside our other inquiry into Kids Company. I will not pre-empt the outcome of those two inquiries, but we are concentrating our inquiries on the conduct of trustees in these matters, and their responsibility to oversee and support charitable organisations so that they reflect their values in their operations as much as in their objectives. We are making recommendations on that because it might be insufficient to rely on processes and structures to ensure that things are ethically and properly run.
Matthew Hancock
I welcome that review, and I hope that during the passage of the Bill we can consider—and where appropriate take on board—any recommendations to improve it. I am glad that the work of that Committee is taking place concurrently, and I hope that recommendations will come forward in time for them to be considered for the Bill.
Dr Murrison
How can we make more explicit the amount of money spent on management overheads, and in particular the £80 to £120 per direct debit set up that goes to chugging agencies? That must be made crystal clear to people. That is, on average, the amount for the first year of any direct debit set up in favour of a charity. At the moment, people are not clear how much of their generosity is being expended on management overall and on that practice in particular.
Matthew Hancock
I am a great fan of transparency and a supporter of transparency across Government. We should consider carefully whether further transparency should be applied to charities, and how that is best delivered. I have no doubt that transparency begins at home for charities, and best practice is for them to be widely transparent about their operations. There is a question about whether we should do more in law, and balanced arguments in both directions. I hope we can consider that during the passage of the Bill.
Geoffrey Clifton-Brown (The Cotswolds) (Con)
Do any of the new powers that the Bill gives the Charity Commission deal with charities that depart from their original charitable ambitions and disproportionately become political funding and campaigning organisations?
Matthew Hancock
We took action towards the end of the previous Parliament to ensure that the legal framework for charities and other organisations means that they do not cross over into direct partisan political work. A review is under way into how the Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act 2014 has worked. There are questions about whether that needs to go further, but the best place to deal with such issues is in the review and during scrutiny of the Bill. I understand my hon. Friend’s concerns, and it is important that our review fully considers the impact of the 2014 Act.
We regard the Etherington package, including the fundraising preference service and a move to opt-in for further contact, as the minimum necessary to rebuild public trust. We propose that regulation of fundraising happens on a self-regulatory basis, but that self-regulation must implement the review’s recommendations in full. Some people have rightly asked what will happen if self-regulation fails. We want it to work, but we are also clear that practices must change. In Committee, we intend to bring forward amendments that will strengthen the Government’s reserve powers to intervene if the self-regulation recommended by Sir Stuart fails. Predatory fundraising targeted at vulnerable people is wrong. It has shaken public confidence in charities and we are determined to stamp it out.
Alongside tackling those challenges, the Bill aims to open up new opportunities.
Mr Jenkin
I am terribly sorry for intervening again, and most grateful to the Minister for being so generous in giving way. I regret that I cannot stay to take part in the debate. The House will need to know that my Committee will produce its reports in January, in good time for the conclusion of the passage of the Bill. Before he leaves the matter of fundraising, will he bear in mind the concern of many people about some charities that raise a substantial part of their income from foreign sources? Security services are concerned that organisations posing as charities might be receiving funds from abroad for nefarious purposes. Will he consider introducing measures to the Bill at a later stage to deal with that matter? I know that that is something that also concerns the Charity Commission.
Matthew Hancock
The Chairman of the Select Committee need not apologise. He can intervene on me as many times as he likes and I will always seek to take his interventions. I know that that must happen, otherwise he will seek to get me in front of him in some other way. On my hon. Friend’s substantive point, that concern has been raised with us. We want to consider the matter in more detail as the Bill passes through the House.
The Bill seeks to open up opportunities for charities to do more to fulfil their mission by providing a new power of social investment. Social investment seeks a positive social impact and a financial return, trying to make money go further. It is a huge and growing chance for UK charities to make more of their assets in a field where the UK is already the world leader. In 2014, the Law Commission conducted a review of charities’ social investment powers. It found a lack of clarity around charities’ social investment powers and duties, and concluded that that could be deterring some charities from getting involved in this exciting new field.
UK charities currently hold assets of over £80 billion, but they have made social investments of about only £100 million. We think that with the right support that market could double in the next few years. The Bill will ensure that more charities have a chance to take full advantage of social investment should they so wish. It removes the existing uncertainty by providing a specific new power to make social investments. It also sets out trustees’ duties to ensure that all social investments are made in the best interests of the charity. That will allow charities to make investments with the dual aim of fulfilling their mission and achieving a financial return. It is the way of the future and it is happening here in Britain. We want to support it to go further.
The work charities do transcends politics and unites hon. Members on both sides of the House. We want all charities to enjoy the very highest levels of public trust and esteem, and the generosity that brings. By delivering a more effective regulator, by tackling unscrupulous fundraising and by unleashing the power of social investment, the Bill will strengthen that trust and allow charities to do more with that generosity. I commend the Bill to the House.
Anna Turley (Redcar) (Lab/Co-op)
It is a privilege to respond to the Bill on Second Reading as shadow Civil Society Minister. I thank the Minister and his colleagues for bringing the Bill before us, and for the open and co-operative way in which they have sought to engage with us. It is much appreciated. I thank all the civil servants involved in drafting the Bill, and all the charities and organisations that have contributed to its development and to our understanding. I also thank noble Lords, who used their customary wisdom and experience to refine and improve the Bill in its passage through the other place.
This is a good and important Bill, and we on the Labour Benches welcome it. There is, of course, some room for improvement, and I will come on to that in my speech, but its objectives are to be welcomed. We all know the vital role that charities play in building a strong and flourishing civic society. Thousands of people around the country give up their time every day to work as trustees and volunteers. Thousands more depend on the vital services they provide. As the Minister said, charities change and save lives. They support the poorest and the most vulnerable. They pick up the pieces of social and economic failures. They heal, they tend the sick, they bring dignity in old age and they give children the best start in life. We owe it to all of them to provide a secure and robust regulatory environment that inspires confidence and allows the sector to flourish.
The sector has had a difficult year. The regulation of the sector has come under increasing scrutiny and we have seen high-profile cases that have been deeply concerning. We have seen poor governance, financial mismanagement and, as the Minister set out, concerning fundraising methods. These cases are extremely rare, but they are deeply disappointing to the rest of the charitable sector. It is important that we support and encourage confidence in the wider sector by clamping down on any abuse. That is why we welcome the Bill.
It has been good to see the sector itself step up to the plate to tackle so many of these concerns. It is vital that we play our part in supporting the sector in that process by giving it the legislative and regulatory environment it needs. It is also vital that we get the right balance: a strong and sound regulatory environment that ensures trust but allows charities the freedom to be innovative, enterprising and, crucially, effective in delivering their social aims and objectives.
We welcome the core aims of the Bill. We support providing stronger protection for charities in England and Wales from individuals who are unfit to be charity trustees. That is vital to ensure good governance and prevent abuse. We support the measures to equip the Charity Commission with new and strengthened powers to tackle abuse more effectively and efficiently. To ensure confidence in the sector, it needs to be able to respond quickly and decisively to any concerns raised. Further clarifications are required, however, and we will work with the Minister to resolve them in Committee.
I want to put on record at this point my pleasure in hearing the Minister say the Government will use the Committee stage to look again at fundraising: at whether self-regulation is sufficient and what steps we can take if it fails. We look forward to working with him on that.
We welcome the aim to give charities a new power to make social investments; some are already doing that, but it is important we give charities the reassurance to enable them to do so. We know that one in three British consumers will pay more for products with a positive social or environmental outcome. It is important that we enable the charitable sector to encourage that.
There are some areas, however, where we believe the Bill can be improved. We will look to work with the Government during the progress of the Bill in Committee to do so. We will be seeking to discuss the following points.
First, on the freedom to speak and engage in political discourse, we continue to oppose the Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act 2014. We intend to use the passage of the Bill to highlight and defend the right of charities by law to campaign and speak out on issues in line with their objectives. So often, it is charities that end up picking up the pieces of our policy failures. It is vital that we give them the right to campaign on their issues, and to challenge and hold us to account. That is a key part of a strong, healthy democratic and civic society.
Secondly, on clause 9 and the disposal of assets, the clause sets out that
“The Charity Commission shall ensure that independent charities are not compelled to use or dispose of their assets in a way which is inconsistent with their charitable purposes.”
We will continue to defend clause 9, so as to give housing associations the statutory backing to ensure they can make their decisions in the best interests of their tenants, and not be bullied by a Government determined to sell off and run down affordable housing. We think it is absolutely right that charities have the freedom to dispose of their assets in the way that they see fit.
Thirdly, on the protection of children and vulnerable adults, the Bill provides an opportunity to better protect children and vulnerable people. We are grateful that the Government accepted proposals in the other place to include people on the sex offenders register as among those who will be debarred from being trustees, but we believe there are other measures we can look at to strengthen that area. We will bring them forward in Committee.
Finally, on clarifying some of the powers of the Charity Commission, the Bill seeks to strengthen the powers of the Charity Commission. We believe there should be a strong, well supported regulator of charities that acts fairly and has the appropriate powers. Ultimately, the regulator must preserve public trust and confidence in charities. However, some provisions in the Bill could threaten charities’ independence. For example, there are no objections in principle to giving the Charity Commission the power to give warnings to a charity, but the current drafting raises some concerns within the sector.
For example, the commission can issue a warning if it thinks there has been a breach of duty or trust or other misconduct or mismanagement. It is possible that the commission could issue a warning about an issue of relatively low concern. Also, a disagreement between the trustees and the commission could arise about whether the warning was justified. It is therefore important to attach safeguards to the issuing of a warning, and failure to comply with it should not in itself have significant consequences that could be disastrous for charities. I hope that we can continue to discuss the matter further in Committee. In addition, the commission should give adequate notice of its intention to issue a statutory warning.
These are issues that should be discussed in Committee because clearer guidelines should exist on the number of days and other protective remedial powers. Given the implications a warning would have for the charity in question, we should also consider a right of appeal to the charity tribunal. I look forward to working with Ministers on those issues as we go through Committee.
In summary, we believe all these areas can be discussed and looked at in more detail as we take the Bill forward in Committee. This is an important Bill. It has some room for improvement, but offers a great deal to build trust and confidence in the charitable sector, which is why the Opposition will support it. I look forward to working with Ministers in Committee.
Fiona Bruce (Congleton) (Con)
I rise to support the rationale behind the Bill, which is of great importance to many members of the public. Its purposes are indeed to protect the public from unscrupulous fundraisers and to stop individuals who run charities abusing them. I agree that action should be taken in such cases, and I agree that the Charity Commission should have appropriate powers where misconduct is proven to have occurred.
I am pleased to note that the National Council for Voluntary Organisations has said that
“it is widely acknowledged that deliberate wrongdoing in charities is extremely rare”,
and it is important to remember that when we debate this Bill. There are many millions of people across the country who devote themselves and give selflessly of their time to charities. It is very important that we do nothing that in any way inhibits them from engaging and contributing to this important part of our civic society.
Having highlighted that motivation, I now want to highlight some of my concerns about the Bill, particularly about some of the new powers it contains. I hope that expressing my concerns is helpful and that they can be explored further in Committee. I speak with particular reference to the new measures in clauses 3 and 11, and the wide-ranging wording of the powers, which I fear could severely curb civic engagement, possibly deterring responsible people from wanting to be appointed as an officer to a charity.
I have more than 30 years’ experience of working in private practice on charity law, and the representation of charities was a particular part of that practice. I know that it has become increasingly difficult over those years to get individuals to step up to the plate, to coin a term, and to agree to an appointment in a charity. That often proves to be one of the challenges that new charities face, particularly—and interestingly—when it comes to the appointment of a treasurer.
I come to this debate, as I say, with over three decades of practical experience of working in this field. I want to ensure that we encourage and do not deter the very responsible people that the Bill is designed to support.
I note that clause 11 provides for new powers to suspend and disqualify. It has an extensive list of reasons within it, but I note that these could in future be varied by Ministers through the laying of new regulations—subject to those regulations being consulted on. We all know, however, that with the best will in the world among the Government, consultations can often reach only a few members of the public. There is the further problem of the regulations being scrutinised only by a few Members in Committee. That is why I am concerned about the excessive powers that will be granted if the Bill is passed, which if extended could come to embrace actions that might not have been fully scrutinised or intended by Members. I enter that caveat about the extension of disqualifications merely by Ministers laying new regulations.
The Bill gives immense power to the Charity Commission. Indeed, in its policy paper of May 2015, the Charity Commission acknowledged that it was gaining “a significant new power” to disqualify people from serving as trustees or senior managers of charities. I am concerned about the wording. The Charity Commission is able under clause 1(1) to issue a warning,
“to a charity trustee or trustee for a charity who it considers has committed…misconduct or mismanagement”.
Clearly, “who it considers” is a very wide-ranging phrase. I note that clause 1(2) allows the Charity Commission to issue a warning that it can “publish”. Yes, the charity or person subject to that warning can respond, but the publication might already have occurred, so I am concerned about the damage to the reputation of the charity in general and the individual. I am worried if there is an opportunity to publish without an opportunity to respond, and I would be grateful if Minister corrected me if I am wrong on that point.
Let me deal with some of the conditions for disqualification. The Charity Commission interprets unfitness to be a trustee to mean failure of honesty and integrity, competence or credibility, the latter being defined as undermining the confidence of the public. That is what I want to highlight in the next part of my speech—how the Charity Commission could take steps to act and issue a warning solely on the one criterion of conduct that might damage public trust and undermine public confidence.
The Charity Commission says that it will use an evidence base relating to the knowledge it gains from the surveys it takes into public trust. I am rather concerned about that. Does it mean that the Charity Commission could carry out a poll, asking people with certain views whether they think the public would be more or less likely to trust an individual or charity? What if those views were very much in the minority or if the views were greatly opposed to current Government policy—views on foreign policy, for example?
That is quite a broad-ranging power, and so far as I can see there are no requirements for any independent review from the Government before the warning is issued. It seems to be based on an individual undertaking some activity or saying something that might be contrary to the views held by the majority of the public who respond to a survey. When the Bill refers to “any conduct”, does that include conduct that someone might have undertaken several years before becoming a trustee? We all know—including many of us in the House—that views can change over time. Many of us might have expressed views some years ago that have changed. How is an individual going to be protected from action taken against them, on the basis of this Bill, which could have far-reaching repercussions?
This is not a merely theoretical issue. Let me highlight how serious a problem this is. I remind Members of the challenges faced by the Plymouth Brethren in the last Parliament. Their charitable registration was threatened because of the interpretation of the words “public benefit” within the Charities Act 2006. We are fortunate now to have William Shawcross as chairman of the Charity Commission. He is an excellent head, a man who possesses wisdom and expresses his opinions, conducts his deliberations and makes his decisions very carefully and with great common sense. Following his appointment, I felt that an appropriate approach was being taken to the plight in which the Plymouth Brethren found themselves when their charitable status was challenged. The case was to go to a tribunal, the Plymouth Brethren had to engage lawyers, and more than 300 churches were affected.
The Plymouth Brethren are a long-established denomination that exists throughout the country, but the challenge that they faced was very serious. They had to spend hundreds of thousands of pounds on legal advice. As I have said before, it was to their the credit that in the past they had done an enormous amount of voluntary work without shouting about it, but now they had to start producing documentation, and indeed they produced some excellent booklets citing the work that they had done to the public benefit. They continue to do that work, one example being disaster relief.
Some major debates were held about the case in the House. More than 40 Members of Parliament attended a debate in Westminster Hall to speak up for the Plymouth Brethren and to say that the Charity Commission’s action should never have been taken, because it had been based on a subjective interpretation of the words “public benefit”. Ultimately, as we know, the commission withdrew its action, and the charitable status of the Plymouth Brethren—and many other charities that had been standing by and waiting for the decision—was secured. However, we do not want a rerun of that case.
Some may claim that minority views undermine public confidence, but where would the suffragettes have been had all this been happening years ago? Our society contains a wide range of views and beliefs, which are often held with passion and principle. Disagreement is common, as we saw in the House only yesterday; indeed, it is a characteristic of a free society. However—and social media can be very cruel in this regard—many people despise or reject others entirely on the basis of their sincerely held but different, or minority, views. Charities are often formed for the purpose of protecting minorities, and it is important for us to ensure that genuine people with genuinely held minority views are protected from what I am sure would be the unintended consequences of the Bill.
Let me return to the subject of faith groups. Many religions in this country espouse views that are rejected by the majority, and a number of those views are very strongly rejected. Creationism, for instance, cannot be taught in schools as a scientific fact, but one would hope that it can still be expounded in RE lessons as a belief. If a charity’s work involved the promotion of creationism as a belief, would that be considered likely to undermine public confidence? There are many other examples—for example, different views on sexual ethics.
I am not, in this context, talking about minorities. A few weeks ago I spoke to a Church of England vicar—and it should be borne in mind that the Church of England is our state Church—who said that he had gone into a school and spoken about a particular view from a biblical perspective, and had gained the distinct impression that he should not come back and talk about the issue again. We must protect people with sincerely held but minority beliefs from the chilling effect that legislation can have on free speech in our society.
Let me now say something about the connection between the new powers in the Bill and the Government’s counter-extremism strategy. I understand that the Government are seeking to ensure that charities are not abused for extremist purposes. The problem is, however, that there does not currently appear to be a clear definition of extremism. That problem affects the Bill, and I think that it could have a very negative impact. The Government’s information document on the counter-extremism strategy defines extremism as
“the vocal or active opposition to our fundamental values, including democracy, the rule of law, individual liberty and the mutual respect and tolerance of different faiths and beliefs.”
That sounds fine, but previous definitions contained two or three additional words that now appear to be missing. They referred to
“mutual respect for and tolerance of those with different faiths and beliefs”.
That was one of our fundamental British values, alongside democracy, the rule of law and individual liberty: mutual respect and tolerance of people who held different faiths and beliefs.
In March, I said in the House:
“It is entirely right that we should respect other people, including those with other beliefs, and to respect their right to hold those beliefs”.
I added, however, that we should be careful not to conflate that
“with a requirement to respect all other beliefs, which is quite a different thing altogether.”—[Official Report, 12 March 2015; Vol. 594, c. 496.]
That is the problem with the current definition of extremism. If I say that I respect scientologists but I do not respect scientology, I mean that I respect those who hold different beliefs, but I do not respect the belief of scientology. Does that make me an extremist? We must be very careful about the way in which we define extremism, and in that connection it is interesting to note that the Government have yet to provide a statutory definition of non-violent extremism.
We all value free speech very highly in the House. A free society is based on disagreement and mutual respect, and I believe that that is strengthened, not compromised, when I respect my fellow citizens without necessarily respecting their beliefs. I mentioned the suffragettes earlier, but the issue of slavery is another example. The wording of the current definition is deeply troubling, and we need to clarify it, because otherwise we could end up contributing to the marginalisation that feeds extremism. Open dialogue with those who hold different views is essential if we are to understand each other’s views, reduce prejudice, and promote community cohesion.
The role that faith groups play in community cohesion through their involvement in the voluntary sector is staggering. Research carried out earlier in the year established that they contribute about £3 billion to social action in their communities, and that is just in monetary terms. In my view, the social cohesion that they provide is unquantifiable. Thousands of churches have run, or helped to run, charity projects for decades. It concerns me greatly that the removal—or the mere deterrence—of those who hold faith-related views that, in our present society, might not be popular, and certainly could not be considered mainstream, could deprive the charitable sector of valuable experience and expertise for decades.
Having had more than 30 years of experience in legal practice and of working with the charitable sector, I know that people are increasingly worried about falling foul of legislation and, as a result, are not becoming charity trustees. Will the Minister look again at the powers relating to disqualification? It is interesting that he used the term “self-regulation”. I would not like to become self-disqualified. I am concerned because the powers are so wide, and we need to ensure that the thousands of experienced servant-hearted volunteers involved in the charitable sector are not deterred from being involved in our civic society. I know that that is not the Government’s intention, and I would be grateful if they looked at these concerns. I am sure that that would be an unintended consequence, but we cannot afford any further marginalisation and exclusion of people from a sector in which they play such a vital role.
Tommy Sheppard (Edinburgh East) (SNP)
I rise in my capacity as the Scottish National party’s spokesperson on the Cabinet Office to make a brief contribution to the debate. You will note on the Benches behind me the absence of Scottish Members of Parliament. Please do not take that to indicate a lack of interest; it is merely an acknowledgement of the fact that the provisions in the Bill do not apply to Scotland and that our constituents will not be encumbered by them. That said, we have a few observations to make on the measures.
This is a certified Bill, but you will note that there is no willingness on the part of Scottish Members to take part in the debate anyway, so perhaps this could serve as an illustration of whether or not it was really necessary to burden the House with the amendments to Standing Orders relating to English votes for English laws. I want to make an effort to be constructive and to help the Government, so if you wish to speed up the passage of this legislation, I can assure you that we will not seek to make any further contribution to, or have any further influence on, the matter under discussion. You could therefore dispense with the legislative consent stage, should that become necessary.
There is a different system in Scotland, obviously, and I pay tribute to the Office of the Scottish Charity Regulator—OSCR—which has, since 2005, provided support for 23,500 charities of all shapes and sizes in Scotland. I want to pay particular tribute to OSCR’s trustees. I have some personal experience in this area, because I served for seven years as a trustee of the Edinburgh Festival Fringe Society, which is one of the larger such organisations in Scotland. It has benefited greatly from the support it has received from OSCR. That said, even though we have a different system, we live on the same island and the regulations that apply in England and Wales set some of the context in which we operate in Scotland, so we have an interest in the legislation relating to England and Wales that is passed in this House.
Susan Elan Jones (Clwyd South) (Lab)
May I make a quick point? Not many people will be aware—I myself was not until about six months ago—that every charity in Scotland is registered with the regulatory body, whereas in England and Wales many of the smaller charities are not. I think that that is of relevance to the wider debate, and I wonder whether the hon. Gentleman has a view on the matter.
Tommy Sheppard
All I can tell you is that it works well in Scotland, and we tend to take the approach “if it ain’t broke, don’t fix it”.
I will make a couple of points on specific aspects of the Bill in a moment, but first I want to welcome the Minister’s general support for the role of charities in our society throughout the country. It is important to recognise, however, that the people involved in charitable organisations are not just there as service providers who deliver things. They are also a valuable source of information and opinion, which can inform many of our social policies, and despite the Minister’s support, the Government may have some bridges to mend with the charitable sector in some areas of social policy. In particular, more than 60 disability organisations and charities have been critical of the Government’s changes to disability benefits. Let us contrast that with the situation in Scotland, where the leading children’s charities have actually praised the Scottish Government for amending some of the regulations.
Turning to the Bill, there are some clauses in which you are bringing the situation into line with that in Scotland. Clause 2 relates to the time limit on the suspension of trustees and clause 8 relates to property. These provisions already apply in Scotland in more or less the same way. I note that in clause 10, which covers the criteria for the disqualification of trustees, you are going a lot further than we have done in Scotland. Our approach would be to let you get on with that and see how it works out—
Madam Deputy Speaker (Mrs Eleanor Laing)
Order. I gently point out to the hon. Gentleman that he has frequently used the word “you”. Actually, that was quite appropriate in the first part of his speech, because he was in a way addressing the Chair. However, when he is referring to the Government, it is better to say “the Government”, or “the Minister”, rather than “you”, because I will not take the blame.
Tommy Sheppard
I stand corrected, Madam Deputy Speaker. Sometimes I use the word “you” in its Scottish vernacular to imply “one”, but I will try to refer to the Government in the third person.
There are some clauses in which you are bringing the situation into line, and some in which you go further, and it is our intention to wait and see what happens. A review is under way in Scotland, which has in part come about because of the discussions that are taking place in England and Wales.
Our main concern relates to the regulations on the ability of charities to raise money. The Scottish Council for Voluntary Organisations has expressed concern that the high-profile cases in English charities relating to the misuse of funds, and the inappropriate ways of raising funds, will have an effect on charities in Scotland, even though they are not part of the same regulatory framework; they could effectively be tarred with the same brush.
We see no great need to change the funding regulations at the moment. Our charitable fundraising arrangements are essentially self-regulatory, and we would like that to continue. However, a discussion involving the charitable sector is under way in Scotland and we are determined that, whatever happens, we will arrive at an appropriate agreement, in which the charitable sector will be involved. It is a matter of debate whether we continue with self-regulation or whether we see the Government becoming more directly involved. The Ministers here have taken the view that this Government should be more directly involved, and that they wish this House to be the ultimate place to which the regulatory system is accountable. We shall watch the situation with interest, and we wish you very well in your endeavours to improve the regulation of charities in England and Wales.
Maggie Throup (Erewash) (Con)
I am delighted to be able to speak today on this very important Bill, which I believe will protect and strengthen the governance of our charities. Our charities play an extremely important role across our nation, and I believe we are stronger for the extensive work that they carry out. We would be so much poorer as a nation if we did not have our amazing charities. It is the hundreds of thousands of generous volunteers who really make a difference, and 41% of people have reported taking part in volunteering in the last year. That is a massive 21 million people across the UK.
Only three weeks ago, every member of my staff took a day’s holiday and spent it volunteering across the constituency as part of my inaugural Erewash volunteering day. One of my staff volunteered at the homelessness charity, the Canaan Trust—which I will talk more about later—and then went on to help with street collections for Children in Need. Another volunteered at a church food bank, then helped to serve a two-course lunch at the Pavilion luncheon club organised by Community Concern Erewash. She also helped to wash up afterwards, which I thought was very noble of her! A third member of my staff helped at the local hospice and joined the Treetops garden club. The club is very proud that one of its team has just been awarded Hospice UK’s volunteer gardener of the year award.
My senior caseworker spent the day at Direct Help and Advice, based in Ilkeston, which has just been awarded Big Lottery funding. And of course I did some volunteering too. I visited a local church to find out more about its outreach community projects. One of these involved chair-based exercises, which are a lot more energetic than they sound. But that project offered more than just exercise; it offered a chat over a cup of tea at the end of the session, and therefore provided social inclusion as well. My whole team really enjoyed the day, and we have decided to make it an annual event. We are already looking forward to next year’s Erewash volunteering day and to working with even more local charities.
Wendy Morton (Aldridge-Brownhills) (Con)
Does my hon. Friend agree that volunteering and charitable giving are not just about giving, because when we volunteer and give we also gain a great deal from it, often from the experience of getting to know different people?
Maggie Throup
My hon. Friend is completely right, and we both experienced that in our time volunteering in Rwanda as part of the social action there. We thought we were going there to give, but we learned and benefited a great deal from that experience. Whether overseas or in my own constituency, I feel very humble every time I go to see a charity.
During our day spent volunteering, my staff and I met all the charity volunteers, the staff and the trustees. Trustees play a very important role in a charity—in the past, I have been a trustee of two charities. Before being appointed as a trustee, on both occasions I went through a selection process and was put under scrutiny. This is only right, as trustees hold very responsible roles. Sadly, we have heard some bad news stories recently of instances when trustees may not have been quite as scrupulous as they should have been. This should not happen, as it reflects very badly, and undeservedly, on every charity across the board, even those not involved. That is why I support this Bill and its aim to strengthen governance and give more powers to the Charity Commission to remove inappropriate trustees. As my hon. Friend the Member for Congleton (Fiona Bruce) pointed out, regulatory abuse in charities is rare, but it is vital that measures are in place to ensure that the public, and indeed the many charity volunteers, do not lose confidence when such incidents happen.
Another aspect of the Bill is to protect members of the public from unscrupulous and unrelenting fundraisers. Once again, there have been some very disturbing stories in the media recently, which simply end up reflecting badly on every charity, even though so many are not involved in such procedures.
Kevin Foster (Torbay) (Con)
Does my hon. Friend agree that “chugging”, as it is called, also puts people off donating, particularly when they hear about the sorts of fees these people receive for the donations they collect from the public?
Maggie Throup
I completely agree. When we see these people on the streets, we tend to avoid them. I think it affects the local shopkeepers as well, as people get a bit fearful of what they are going to find on their high streets.
It has another effect, too. In their later years, my parents stopped donating to charities when the donations were in any way traceable. This was because after making one donation, they got phone call after phone call trying to persuade them to set up a direct debit. My parents were subjected to just a fraction of the pressure that Olive Cooke suffered, which ended in such a tragedy. With 44% of adults reportedly giving money to charitable causes every month, it is very important that donors feel they can make their donations freely and know that their donations are being spent wisely. This Bill ensures both things.
Of course, our small local charities do not employ third-party professional fundraisers, but have to use their ingenuity to raise their funds. Members will have heard me talk before about the fundraising events organised by my local hospice, Treetops, which provides amazing care in the community. I have awarded prizes at its dog show, which raised money, and taken part in its sponsored bike ride taking in all its charity shops across Derbyshire—and I did that on a tandem. There is always something happening somewhere in Erewash; there is always a charity event going on somewhere.
Only last Saturday I popped along to the Christmas fair organised by the League of Friends of Ilkeston Community Hospital. When I got there I was delighted not just to see Father Christmas but to find that Ilkeston Rotary had a stall there, as I knew from last Christmas that it would be selling locally made Christmas cakes which are very tasty, and which have saved me trying to find the time, rather belatedly, to make one. At the Long Eaton Christmas lights switch-on last Thursday, I was able to win on the Scout’s tombola—every ticket was a winner—and buy some handmade Christmas tree decorations from the Women’s Institute stall. All these make fantastic contributions to my local area, and it is much richer as a result.
I said earlier that I would come back to the Canaan Trust, a Long Eaton-based charity providing much more than just a bed for homeless young men. The social investment part of this Bill will provide the ideal vehicle for this charity, should it wish to provide low-rent accommodation for those young men once they get their lives back on track, and help them move on even further with their lives. As my right hon. Friend the Minister said, social investment is the way of the future, and I am delighted that it forms part of this Bill.
I believe this Bill provides a suitable means of protecting our many charities from unscrupulous behaviour, so maintaining the confidence of the public, the confidence of the many donors, and the confidence of the amazing volunteers as well as those who are employed by the charities. I will want to ensure in Committee that our small local charities will not be penalised in any way as a result of these changes, but I do like the way the Bill provides a mechanism to enable charities to develop social investments that can be of great benefit to those they serve.
I am delighted to have been able to speak in support of this Bill, with my reservation about its potential impact on small charities such as those I have talked about today, and to outline its benefits to the constituents of Erewash.
Susan Elan Jones (Clwyd South) (Lab)
It is a great pleasure to take part in the debate on this Bill. I want to make a few points. I think many people welcome the fact that the Government are taking action to prevent individuals who are unfit to become charity trustees from doing so and are tackling abuse and mismanagement of charities more effectively. However, I have a few questions over some details.
There is widespread agreement across the voluntary sector and among the general public—this very much recognises what the hon. Member for Erewash (Maggie Throup) said—about the problem with predatory fundraising when it is done in an unethical way. It is good that the sector itself is coming forward with the idea of a fundraising preference service. That will be very important.
It is worth bearing in mind, however, that across England and Wales there are 943,000 trustees, and we in this House bear some responsibility for making sure we do not scare them to death with regulation. The bulk of charities in this country are not like Kids Company, which appears to have got away with a remarkable amount. We are talking about people who give up their time to serve on management committees, often when they do not have much time to give up. We do not always do that well in the diversity of trustees. I think the average age is 57, and only about one in 200 is between the ages of 16 and 24, so I would be reluctant to do anything that scares off too many people. However, there is a case for returning to the proposal suggested a few years ago by Lord Hodgson for time limits—for larger charities only; it would be ridiculous for the village hall committee and many smaller management groups. I hope that can be considered during the Bill’s passage.
I have a couple of other small points. Members have already suggested that clause 1 gives the commission an absolute discretion to publish an official warning to a wider audience. However, charities depend heavily on funding and reputational matters, so if there is no real right to appeal against a warning and no minimum notice period, that needs to be looked at.
The issue with clause 11, which centres on the power to disqualify from being a trustee, relates to clarity. We agree in principle that, if there is genuine abuse, it is important that such a power can be used. On clear cases, there is a question about whether the amount of discretion available is too wide; many of us agree that that needs to be defined much more clearly. The hon. Member for Congleton (Fiona Bruce) raised the issue of past behaviour in her extensive speech.
I welcome the Bill. It is part of the consideration of how charities develop in the modern world, but we have to be careful. It is so easy for us to add new regulations that frighten charities, especially smaller charities, from doing their work. Often, charities start off very small. For example, Your Space in Black Park in my constituency started off very small, but it has now become a state-of-the-art charity working with children and young people with autism. Such things often begin from little acorns, but we must not smother the little acorns with too many regulations. I am not sure whether it is possible to smother little acorns, but if it is possible I do not think we should do it.
Although I broadly welcome the Bill, we need to look at some of those details. In the last Parliament, the Government made changes following the Committee stage of the Small Charitable Donations Act 2012. I hope we can debate at a later stage the issues I have raised.
Wendy Morton (Aldridge-Brownhills) (Con)
It is a pleasure and a privilege to take part in this debate. Charities do fantastic work, both nationally and locally, across the breadth of the country. We have heard some fantastic and inspirational examples from my hon. Friends the Members for Erewash (Maggie Throup) and for Congleton (Fiona Bruce), who is no longer in her place, of the work that goes on up and down the country.
In the days when I used to run half-marathons, such as the great north run, rather than just run from my office to this Chamber or to the voting Lobby, I was always particularly impressed by the number of charities represented by runners and the generosity and support of the general public. I was often a little disheartened when somebody wearing fancy dress ran passed me at a much quicker speed, but you can’t have it all ways.
The local charities in my constituency include Rosie’s Helping Hands, which was set up by a couple to help them handle the grief of losing a beloved daughter and to deal with it in a very positive way for our local community. They hold numerous events, including a charitable walk, and the money raised goes into helping children and young people in our local community.
We also have many local branches of some of the big national charities. Our local branch of the Royal British Legion does so much, like every other branch in the country, to raise awareness and funds for an incredibly important charity that supports armed forces veterans. In the village of Pelsall it encourages the whole of the local community to knit poppies in advance of Remembrance Sunday. The red poppies were placed over the clock tower, and the way in which the charity brought the community together and raised funds is another example of why the charitable community is so important.
Maggie Throup
Does my hon. Friend agree that this is partly about fundraising and partly about the feel-good factor created in communities?
Wendy Morton
I could not agree more. Even I got out the knitting needles and learned how to knit again. It was a case of knit one, purl one and then drop several, but I did my bit, as did everybody else. The community came together, worked together and had a bit of fun for an incredibly worthwhile cause.
Small charities often play a huge part in our local communities. They provide something over and above, or in addition to, what the Government or the public sector provide. Those small things often make a big difference to the lives of individuals and their families.
Through my involvement with social action projects over the years, I have been extremely fortunate to get to know many charities, both in the UK and overseas. I have also spent time with other Members on projects working with charities in Rwanda.
As some Members will be aware, a private Member’s Bill of mine is going through this place, to help Great Ormond Street Hospital Children’s Charity. I had the great pleasure of visiting the hospital and seeing some of the fantastic work it does in supporting patients. It is involved in building projects and has a chapel, and it does a huge amount of paediatric research. None of that would be possible without the work of the charity and all the people involved in it.
Sadly, the results of high-profile charity crises can damage trust in charities. It is really important that we do all we can to maintain and strengthen that trust, and the Bill demonstrates the importance of having an effective charity regulator.
I support the Bill because it will provide stronger protection for charities in England and Wales. It will also equip the Charity Commission with new and stronger powers to tackle charity abuse more effectively and efficiently.
Kevin Foster
My hon. Friend is making some strong points in support of the Bill. Does she agree that, in order to keep the flow of funds coming in from the public and from donors, it is vital that abuse is not possible and that the public have confidence that there is a mechanism to tackle it?
Wendy Morton
Absolutely. Trust and confidence are critical. That is why I believe that robust but proportionate action should be taken where serious mismanagement occurs. It is about maintaining and strengthening trust in a vital sector and enabling all charities, both large and small, to continue to do their work.
I have one plea, which is that the Bill needs to ensure that smaller charities are not disproportionately affected by any bureaucracy or too much legislation. It does not matter whether a charity is small or large: charities have so much to give to our country, society and communities, and I will do all I can to ensure that they get the support they deserve.
Robert Jenrick (Newark) (Con)
I welcome the Bill, which is a much needed and sensible Government reform. I am delighted that they have introduced it.
Before entering this place, I practised as a solicitor for several years. I practised corporate governance, among other areas, and over the course of the past year, I think we have all come to realise that the governance of charities is in crisis and it is affecting all charities. The large charities are infecting the small charities, which is why it is so important for this House to act.
As has been said by many Members on both sides of the House, we all support the charities in our constituencies, including those we give to and those of which we are trustees. We want them to thrive and we want public confidence in them to increase, because, undoubtedly, public confidence in charities has been knocked this year. As the head of a charity based in my constituency recently told me, charities are different from many other parts of our society. When large businesses get knocked by scandals, the public turn towards the little guys and confidence in them rises. If there is a horsemeat scandal at Tesco, we all go to our local butchers and sales there start to rise. Charities seem to have the inverse situation. If the big charities get hit by scandals, the little guys suffer as well.
It is essential that we protect the thousands of excellent small charities that we, as Members of Parliament, get to know more than most members of society. It is for them that we must ensure that the larger charities, in particular, have the highest quality of governance. That comes down to trustees. It has been a torrid year in many respects for how the large charities have behaved, whether the scandals have been about the high salaries of chief executives and the management teams of big charities, about the question of politicisation or, above all, about the question of the inappropriate use of fundraising on our high streets. Of course, there has been the tragic case of Olive Cooke.
Kevin Foster
My hon. Friend is making a very strong speech. Does he agree that part of it is about the public having confidence about how much of the pound that they donate ends up going to the good work of the good cause, particularly as with some of the larger charities there have been issues about how much ends up going on overheads and administration?
Robert Jenrick
My hon. Friend makes a strong point. I want to come on to how we can ensure proper financial management of our charities. That cuts in both directions: how they govern themselves and what percentage of their organisation and resources is deployed on central management.
Kids Company has seen the last and perhaps most prominent scandal, which has raised all manner of questions about the governance of our most high-profile and largest charities, particularly their capacity to handle their finances appropriately. I do not want to dwell on Kids Company, which is an outlier, but it has done huge damage to other charities. That is why those who have been at the heart of it and those parts of Government that have worked with Kids Company have to take it seriously. It is damaging all our charities throughout the country. The powers in the Bill to bar ineffective and inappropriate trustees from acting as trustees will be tested if there are Kids Company-type scandals in future.
Nigel Huddleston (Mid Worcestershire) (Con)
Is that not at the heart of the matter? The vast majority of people who work with, volunteer for or have leadership positions in charities across the UK generally do the right thing in their day-to-day activities. Through this Bill and other initiatives, we need to try to get the right balance between governance and allowing them to get on with doing the things that they really want to do.
Robert Jenrick
My hon. Friend makes the point perfectly. It is important to remember that the core activities of our charities are rarely questioned. They are usually performed incredibly well and incredibly sensitively and appropriately. The scandals and disappointments tend to come from the way the operation of our charities occurs. That is why it is incredibly important that trustees play their full role in managing, scrutinising and supporting those organisations, as do directors and non-executive directors of our companies.
The role of a trustee has to be at the heart of it all. The new Bill is important in that regard as the power to bar individuals who are not appropriate to be trustees and who bring charities into disrepute is incredibly important. I would be interested to know from the Minister how many trustees he believes that that would apply to in an average year. Will the difference be marginal, or will it be more significant? As for the question of preventing trustees from moving on, after damaging an organisation, to continue in many others, we all know that many people—many good people—are trustees of several charities and so, inevitably, the bad apples are also involved in many charities. We want to ensure that that involvement cannot continue.
The power to issue warnings to charities is important if the Charity Commission considers their actions to amount to misconduct or mismanagement. Of course, that must be done proportionately and the Charity Commission has not always acted proportionately on a range of other issues, including, as we heard from my hon. Friend the Member for Congleton (Fiona Bruce), the issue of the Plymouth Brethren. Had I been in the House at the time, I would certainly have supported that important campaign.
Many involved in the third sector have expressed concern that the Bill gives the commission the benefit of the doubt, but bearing in mind the importance of raising public trust in our charities, particularly the big ones, it is essential that we have a strong regulator with the tools to act. The Bill provides that.
I have some questions and thoughts for the Minister on the role of trustees. First, it is absolutely essential, as Kids Company showed—this seems a simple and obvious point—that a board of trustees contains the right range of expertise. That is stipulated within the guidance of the Charity Commission but, clearly, it does not always happen. In particular, that must include the right range of financial expertise. When charities reach a certain size, like our larger companies, they qualify to be in the FTSE 250. They are huge organisations and require individuals with genuine financial expertise and knowledge of financial controls so that they can scrutinise the organisation and hold it to account.
Fiona Bruce
I hear what my hon. Friend is saying, but my concern is, as the hon. Member for Clwyd South (Susan Elan Jones) mentioned, possible regulations for larger charities. My concern is how that is defined and that one might bring in the smaller charities. Does my hon. Friend not share my concern about the difficulty in attracting officers of charitable organisations, particularly to the role of treasurer, as my experience shows?
Robert Jenrick
I share that concern. We all know through the other organisations in which we are involved how difficult it can be to find good people, particularly younger people, as has been said, to act as trustees. Incidentally, the charitable sector is a lot more diverse than our corporate sector. About 40% of charitable trustees are women, and that figure is not the same in the corporate sector. It is important that we do not put people off from getting involved. It might be that the time has come when “one size fits all” does not work and that our largest charities, which uphold public trust and confidence in charitable giving more generally and which are very large—we are encouraging charities to merge and get larger—should be subject to far greater scrutiny and a different regime from the small ones that we all know in our constituencies and want to thrive.
Fiona Bruce
My hon. Friend is being very generous in giving way. Perhaps for the very small charities there needs to be some sort of Charity Commission kitemarked course that a would-be trustee can go on to ensure that they have the necessary understanding of the role required.
Robert Jenrick
My hon. Friend comes on to a point that I wanted to make. By the Charity Commission’s own reckoning, knowledge of governance rules and best practice is quite limited among our trustees. I do not blame them—they are busy people who are doing this voluntarily and we want to encourage that—but knowledge is quite limited. The awareness and knowledge of some of the guidance—for instance, CC3, which is “The essential trustee” guide—are quite modest. Surveys that the Charity Commission has put out to trustees of larger and small charities suggest that basic functions of being a trustee are not widely known by our trustees.
Anything that the Charity Commission can do to boost awareness without putting off our trustees is essential. I know that the Charity Commission takes that seriously, because I have spoken to it, but it needs to do something to boost that awareness and support trustees in a way that strikes the right balance between not deterring people and ensuring that they know what they are supposed to do. Some of the reports and surveys are quite scary when it comes to how few trustees understand their responsibilities, particularly as regards finance.
Kevin Foster
My hon. Friend is being extremely generous with his time. Does he agree that it is also important that we ensure that anyone who wants to do the best for their community or to support a good cause does not feel excluded from being a charity trustee merely because they do not have formal qualifications? It is important that the Charity Commission helps to build the skills they need, as I would not want to see trusteeship become a graduates-only zone.
Robert Jenrick
That is very important, but I do return to the theme of some of our biggest charities. They are major organisations dealing with hundreds of millions of pounds of not only the public’s money, through charitable donations, but the taxpayer’s money. I am nervous to dwell on the case of Kids Company, but its trustees had very little relevant expertise. One was a celebrity hairdresser—there is nothing wrong with that, but I do not expect that person necessarily to have expertise in running a major multinational business, as Kids Company had become. It is therefore essential that those organisations step up and have appropriate trustees. I would like this Bill and the Government to push our biggest charities to have those individuals.
I know that charities are now required in their annual return to confirm whether or not they have reviewed their financial controls. Clearly, that important lesson has come out of recent scandals, and such a provision is essential. Anything we can do to beef it up, without deterring the little guys, is essential.
Another issue is that, unlike as happens in companies, most trustees do not meet in mixed board meetings with their management, and so the interplay between the two is often limited. Those trustees who take their role most seriously and work hardest at it no doubt get to know the senior management of their organisation, but others do not and often rely, crucially, on the chief executive, who may be, as we have seen in other scandals, an overbearing founder. Such a person may be incredibly charismatic, powerful and knowledgeable about the organisation, but it is difficult to scrutinise them, stretch them and hold them to account. That is important, and our larger charities have started to have mixed board meetings involving executive and non-executive directors— I use the corporate setting there.
I would like the Government to think about the role of overbearing founders, because it is an incredibly important issue. Anyone involved in the charitable sector sees examples where someone who may be a brilliant individual founds a charity and then it gets out of control, as they become extremely difficult to scrutinise and perhaps the time comes when they should step aside or hand over to somebody else. Perhaps it would be appropriate for these individuals to have term limits, as we might have for a chairman of a public company, where they have to go through a rigorous procedure at the end of a certain term in order to be reappointed.
A number of our charities, even the largest ones, are riddled with conflicts of interest. We see trustees having friends and relatives employed in the organisation, and trustees sometimes getting benefits that are not appropriate. I do not think the Bill particularly deals with that issue, but it does a lot of damage and undermines confidence in the charitable sector.
Lastly, I wonder whether the Minister really believes that the Charity Commission has the capacity to regulate the vast number of charities. We have thousands of charities in this country, some of which are extremely complex organisations, as we have seen. Does the Charity Commission have the resources to do that work? I suspect it does not, a view shared by many in the sector. Some of our most experienced chief executives believe the time has come for some form of beefing up of the Charity Commission through self-funding, whereby the big charities, which are the holders of public trust and confidence, might contribute some money towards ensuring that trust in the wider sector is maintained through a Charity Commission that has the funding required to see that happen.
I know that the Minister wants to speak, so in conclusion, trustees are absolutely essential and those of our biggest charities are letting down the entire sector. Scandals such as what happened at Kids Company matter, because they are harming the small charities, which are the lifeblood of charitable giving. As a Member of Parliament, I have taken huge pleasure in getting to know and working with these charities in my constituency, and I know other Members feel the same. Those who hold those positions in the big organisations need to step up and behave as if they are non-executive directors of large and important organisations, which they are.
Louise Haigh (Sheffield, Heeley) (Lab)
This is my first time at the Dispatch Box responding to a Bill, so may I say that it has been a pleasure listening to learned contributions from hon. Members on both sides of the House? I would have liked a few more hon. Friends to be behind me today, but I assure the House that the fact there are not is not a signal of our disinterest but one of our wholehearted support of the Government’s objectives in the Bill.
This has been an important and helpful debate, and I congratulate all Members who have participated in it and everyone who has been involved in getting the Bill to this place, particularly our colleagues in the other place. We have had a small number of contributions, but fortunately this debate has been defined by its quality, not its quantity.
The hon. Member for Congleton (Fiona Bruce), who brings extensive experience in the sector, spoke about the difficulties in encouraging trustees to charities. She also discussed concerns about giving the Charity Commission the power to judge whether a potential trustee had committed misconduct and about powers to publish a warning notice, risking enormous damage to a potential trustee’s reputation.
The hon. Member for Edinburgh East (Tommy Sheppard) spoke about how the Bill cannot be viewed in a vacuum and should be viewed in the context that charities in our communities are increasingly being asked to do more with less, as the cuts, particularly those to our local authorities, bite further.
The hon. Member for Erewash (Maggie Throup) paid tribute to the many volunteers across her own community who respond to vital need, just as they do across all our communities. All of us will have fantastic charities that fill sadly much-needed demand in our constituencies, but I will not put your patience to the test by listing all the ones in my constituency, Madam Deputy Speaker.
My hon. Friend the Member for Clwyd South (Susan Elan Jones) praised the charitable sector for developing the fundraising preference service, demonstrating the willingness of the sector to tackle issues highlighted by the Bill.
The hon. Member for Aldridge-Brownhills (Wendy Morton) spoke passionately about her experience of volunteering, the impact of small charities in her constituency and her own private Member’s Bill on supporting the renowned, fantastic work done by the Great Ormond Street Hospital Children’s Charity.
The hon. Member for Newark (Robert Jenrick), a fellow former corporate governance practitioner, spoke about how we must ensure that small charities do not pay the price for the mistakes of larger, misbehaving charities. He made reference to Kids Company, whose case has had ripple effects across the whole sector. I am glad that that charity has not dominated our debate today, because, as he said, it is an outlier, at best.
Today's debate has provided a platform to debate the much-needed powers that will allow the Charity Commission to regulate the sector better, but first I wish to echo the feelings of Members on both sides of the House by saying that we know the special role charities play in our constituencies and in the country as a whole. As the Minister for the Cabinet Office and Paymaster General rightly said, “the work charities do transcends politics and unites” this House. Britons donate billions of pounds per year, and very often it is those without a great deal donating what they can to the causes close to their heart or to those in need in the community around them.
Charities are also the vehicle by which many of us can try to make a difference for the communities in which we live. Figures vary, but the latest estimate is that nearly three quarters of us of do some form of volunteering for charities at least once a year. To put it simply, the values and ethos of those nearly 1 million trustees who give their time to make our country a kinder and more interesting place are the best of Britain.
We know, therefore, that charities have a great deal of good will and public support. As my hon. Friend the Member for Redcar (Anna Turley) rightly said in opening for our side, they support our vulnerable and our sick and elderly, and give people the chance to change lives. With that in mind, it is vital that charities and their regulator have the appropriate powers to act in the extremely rare event that misconduct occurs.
As we have heard, deliberate wrongdoing in charities is extremely rare, but it is important that the regulator has the power to take robust action where it does occur. We know that the measures in the Bill to prevent trustees who are not fit to hold the position from serving as trustees are widely supported by both the public and charities themselves—this is simply common sense.
We therefore support Government moves to close the loopholes and strengthen the Charity Commission in this important aspect. As Members across the House will know, the Charity Commission already has a wide range of compliance and enabling powers, but there are underlying weaknesses, including a limit on the commission’s ability to prevent and/or tackle abuse in charities. The powers the Charity Commission did have were not powers that we would expect a modern regulator to hold—they did not go far enough—so we welcome the strengthening of its powers.
In securing these new powers, we will enable the Charity Commission to regulate more effectively. We know that it is of the utmost importance that we are able to find the right balance between having good governance that gives people the confidence to support the sector and ensuring that charities have the freedom to be able to do what they do best—being brave in their determination to build a better society, innovating, responding to the challenge of today and tomorrow, and delivering effectively and with value for money.
As we have heard, the vast majority of charities and trustees act in the interest of their beneficiaries, but the poor governance and unscrupulous fundraising activities of a few undermines confidence in the whole sector. We therefore welcome this Bill, and we very much welcome the new social investment powers and powers to disqualify trustees. But we would not be an effective Opposition if we did not point out areas of room for improvement.
We are disappointed that the Government will seek to overrule the other place by removing clause 9, a vital amendment that protects charities from arbitrary rulings requiring them to dispose of their assets in contravention of their charitable purpose. I hope we can revisit that matter in Committee and that we can do so in the same cross-party manner of this debate.
A number of hon. Members have made good points on fundraising, on the very important protection of minority views, which we in this House should hold so dear, and on ensuring the balance between regulation and enabling charities to do good in their communities. I know that the Minister will have been listening closely to this debate. I hope that we can work together on a cross-party basis to improve this Bill at Committee stage. With that, I can assure the House that we are happy to support this Bill on Second Reading.
The Minister for Civil Society (Mr Rob Wilson)
I thank all hon. Members for their excellent contributions to this debate. Clearly, these issues are very important to them and their constituents. May I add my welcome and congratulations to the hon. Member for Sheffield, Heeley (Louise Haigh) on her first outing at the Dispatch Box? I am sure that it is the first of many.
It is clear that the House has great respect and admiration for the good work currently being done by charities throughout the UK. I also know that hon. Members have much experience and expertise of charities in the voluntary sector, which was demonstrated during some of the speeches today.
There is also a strong desire to protect the privileged position that charities hold in the eyes of the public, as was demonstrated in the latest world giving index, which found Britain to be the most generous nation in Europe. We also have a strong, diverse and growing charity sector. Over the period of the last Parliament, the number of registered charities in England and Wales increased by more than 2,000 to 165,000. Their combined income has grown by more than £10 billion, and is now just short of £70 billion a year.
Before I address the remarks that have been made by hon. Members, let me take the time to echo a point that has been made throughout this debate. The vast majority of charities in this country do excellent work and are run by good, honest and generous people. They wish to help those most in need and make the world a better place. I particularly wish to pay tribute to charity trustees, without whose unpaid efforts there would be no charity sector. For their selfless passion and commitment, they have my respect and sincere thanks. However, their good work is threatened by a small minority who seek to abuse charitable status for their own ends. The Bill will help the independent regulator to take robust action against that small minority. By doing so, it will reinforce public trust and confidence and protect the reputation of charities as a whole.
The powers in the Bill have broad support from the charitable sector and the public. The charity commissioner has been involved throughout the process of developing these proposals. The sector has also been subjected to public consultation and pre-legislative scrutiny, both of which helped inform and refine the proposed powers.
Some have argued that the Bill would give the Charity Commission too much power, or that some of the powers are too broad. In response, I say that the Bill seeks to achieve a balance. The new commission powers need to be broad enough to make them useful. If they are too narrow they would be impractical and go unused or would leave loopholes to be exploited by the unscrupulous. Charities also need to know the circumstances in which the commission will use its powers.
Although this Bill achieves the right balance, I wish to draw the attention of hon. Members to a couple of key safeguards. The Charity Commission is subject to a general duty under section 16 of the Charities Act 2011. That means that the commission must be satisfied that the exercise of any of its powers would be in line with the principles of best regulatory practice, including that it is proportionate, accountable, consistent, transparent and targeted only at cases in which action is needed.
Fiona Bruce
I thank the Minister for drawing our attention to that section. It is a pity that it was not invoked when the whole interpretation of public benefit was being debated, and that the Charity Commission did not refer itself back to it then. My concern is that this Bill could be in force before there is a clear definition of non-violent extremism. The Government’s counter-extremism strategy says that this Bill would give the commission powers to disqualify trustees for wide reasons, including past conduct and a variety of other abuses, such as extremism. In the same strategy, there is also reference to non-violent extremism. Will the Minister address that point?
Mr Wilson
I thank my hon. Friend for her contribution this afternoon and her question. She raises some extremely important issues, with which I intend to deal in full. As she has asked, let me just deal with the public benefit and religion issue first. Religious charities play a hugely important role in our public life. Over 25% of registered charities have a religious purpose and are often working in some of the most hard-to-reach communities. The advancement of religion is one of the oldest charitable purposes, and there is no question but that it is under threat. There are more than 25,000 registered religious charities, almost all of which have no difficulty in demonstrating their public benefit.
My hon. Friend mentioned the Plymouth Brethren in her speech. Its case was an exception, and I am pleased that it was resolved in a sensible way, even though it took too long. I will come back to some of the other issues that she raised later in my comments.
All the proposed commission powers in the Bill have a right of appeal, in most cases to the Charity Tribunal, ensuring that there is independent judicial oversight of the exercise of the commission’s powers. There have also been some questions, notably from my right hon. and learned Friend the Member for Harborough (Sir Edward Garnier), about the rehabilitation of offenders.
The Government believe that individuals with serious convictions should not be able to hold the position of charity trustee and have control over charitable funds and fundraising activities until those convictions are spent or a waiver from disqualification is obtained from the commission. The waiver regime exists to enable disqualified individuals who wish to be a charity trustee to apply to the Charity Commission for their disqualification to be overturned.
A waiver application would be considered on a case-by-case basis, and the Charity Commission would take into account the nature and seriousness of the conduct that had resulted in the conviction and consequential disqualification.
A decision by the Charity Commission not to grant a waiver could be appealed to the Charity Tribunal, which would consider the matter afresh. That strikes me as a fair and proportionate system that on the one hand protects charities from individuals who present a known risk, and on the other hand provides for the rehabilitation of offenders and a way back into charity trusteeship on a case-by-case basis.
People have also raised concerns about the official warning power and the fact that there is no right of appeal to the Charity Tribunal. There is a right of appeal, which is judicial review. That is the same position as now, where the commission publishes its operational compliance case reports on non-inquiry cases that have attracted public interest and that highlight important lessons for charity trustees.
The Bill provides for a period of time to allow representations to be made in relation to an official warning, which the commission would be obliged to consider. There is then the option of judicial review. We consider that proportionate.
A right to appeal an official warning to the tribunal would be disproportionate and could tie the commission up in red tape, rendering the power impractical for its intended purpose. The last thing that we want to do is give the Charity Commission powers that it cannot use, and for which it could be criticised for failing to exercise several years hence. The Joint Committee that undertook pre-legislative scrutiny agreed that, with the appropriate safeguards in the provision, judicial review was the appropriate route for appeals.
Let me turn now to fundraising. I was deeply disappointed to see the extent of poor practices by large charities in relation to their fundraising. That matter was widely exposed by the media earlier this year following the sad death of Olive Cooke. Since then, further damaging cases have come to light, and once again the reputation of charities has been put at risk by the actions of a small minority. Public trust and confidence in charities have not been this low since 2007, and charities now rank 12th in the list of most trusted institutions, below supermarkets and television and radio stations. Only 48% of people said they trusted charities.
In response to the fundraising scandals, we acted swiftly to amend the Bill in the other place to reinforce charity trustees’ responsibilities and accountability for the charity’s fundraising. Clause 14 will encourage charities to exercise greater control and oversight of those who fundraise for their organisation. It will ensure that there are proper processes for dealing with vulnerable people and will generally safeguard the public. Large charities will make this commitment public through their annual reports so that anyone can hold them to account for how they interact with them.
I asked Sir Stuart Etherington to conduct an independent review of how fundraising regulation could be improved to safeguard vulnerable people and better respect the public’s wishes about how and whether they are contacted. He was supported by a cross-party panel of peers. I have since accepted the review’s recommendations in full, and I am now encouraging the sector to move quickly and firmly to show that it gets the public’s anger and concern and is committed to making self-regulation work.
I also expect the sector fully to back the new fundraising regulator, both financially and through compliance with its rulings. In the past few weeks, I have announced that Lord Michael Grade has been recruited as the interim chair of the new body and will oversee the set-up and initial phase of operations. I am confident that he is the right man to lead this important task and that the sector will unite behind him to address these urgent issues and restore public trust in fundraising.
The new regulator will also host the fundraising preference service, a tool that will allow people to opt out of receiving fundraising requests and that will stop charities wasting resources on approaching those who do not wish to hear from them. A working group is currently being set up to establish how the service will work in practice. In addition to a simple reset button, there will no doubt be a few more nuanced options should people wish to opt into certain charities only. Crucially, it will provide everyone with a way to get off charity contact lists they no longer wish to be on.
Charities need to demonstrate that fundraising and its self-regulation can work in the best interests of the public. They will have the chance to do so at a summit tomorrow, when the next steps for implementing better self-regulation will be announced. I hope that this will be a constructive and collaborative meeting where charities show their commitment to the new self-regulator and to meeting the public’s expectations. Should they fail to do so, I stand ready to step in to safeguard the public and their trust in charities.
For that purpose, I will seek to add two reserve powers to the Bill: one to compel charities to sign up to the new regulator and a second to mandate the Charity Commission with regulation should the sector fail to rise to the challenge. I also welcome the commission’s revision of its guidance for charity trustees on fundraising, which it has published today. It reminds trustees of their duties and responsibilities in relation to fundraising, including the need to protect their charity’s reputation and that of the wider sector.
The Bill also provides support to social investment. As many will have seen in the autumn statement, the Government have shown a strong commitment to social investment, having invested £80 million to grow social impact bonds in the UK. For charity investors, the power of social investment enables them to increase their mission impact and sustainability by making investments that provide a financial return as well as furthering the purpose of the charity. Although most charities can make social investments under the current law, it can be complex and costly to do so. The new social investment power for charities in clause 15 was recommended and drafted by the Law Commission to overcome that complexity and reduce the costs of investment for charities. It was widely supported on consultation.
The UK is already recognised as a world leader in social investment, an area in which the Government have taken pioneering action. For example, we have set up Big Society Capital and stimulated the use of social impact bonds to deliver services to some of the most disadvantaged in society through initiatives such as social outcomes funds. With the power of social investment conferred on charities by the Bill, we take another step forward in building a sustainable social investment ecosystem.
I now turn briefly to interventions and speeches. My hon. Friend the Member for South West Wiltshire (Dr Murrison) asked about the transparency of direct debit fundraisers. Professional fundraisers are already required to state how much they are paid for asking the public to donate, but I would be happy to discuss the matter further in Committee. I was delighted by the contribution from the hon. Member for Edinburgh East (Tommy Sheppard), who spoke for the SNP and may well have set a precedent under English votes for English law: he said that the SNP would not be taking part in any other stages of the Bill. I hope that that precedent will now stand.
I thank my hon. Friend the Member for Erewash (Maggie Throup) for an uplifting speech and her comments about her inaugural volunteering day. I hope it sets a precedent for other MPs. It is great to see that that will now become an annual event, and I certainly wish it well. I also thank the hon. Member for Clwyd South (Susan Elan Jones) for supporting the fundraising preference service. For the sake of fundraising in the future, it is important that it works. I also thank my hon. Friend the Member for Aldridge-Brownhills (Wendy Morton), who told us the wonderful story about poppy knitting in one of her villages. It demonstrates the value of civil society and the contribution of charities. She is absolutely right that a small kindness can make a big difference.
For several reasons, legislating for a maximum trustee term does not appeal. The evidence is that 50% of charities are carrying at least one trustee vacancy, and we must be mindful that the role is a voluntary one. My hon. Friend the Member for Erewash mentioned the impact on small charities and made an important point about minimising the burden of regulation, as did the hon. Member for Clwyd South. We are keen to minimise the burden of regulation on small charities. For example, the new reporting requirement on fundraising in clause 14 will apply only to charities with incomes over £1 million, and the new fundraising self-regulator will need to consider exemptions for small charities from the fundraising preference service.
My hon. Friend the Member for Newark (Robert Jenrick) made a strong speech that clearly set out how big charities were causing great concern for some smaller charities. It is certainly our intention to try to protect them. The Opposition raised concerns about campaigning. To be clear, charities cannot engage in party-political campaigning, and where they undertake any other types of campaigning to support their charitable purposes, they must avoid adverse perceptions of their independence and political neutrality. In addition, they must not embark on campaigning to such an extent that it compromises their legal status as a charity. The Charity Commission provides clear guidance, in CC9, about what is permitted. It makes it clear that charity law recognises that non-party political campaigning can be a legitimate activity for charities and sets out the general principles.
A concern was raised about whether the commission should be able to publish official warnings. Charities exist for public benefit and depend on public support, so there should be transparency and publication of official warnings when the regulator considers it necessary to intervene, unless there is a good reason not to publish them. There should always be an opportunity, though, to make representations about the factual accuracy of a statutory warning before it is published, and a process for representations is included in the Bill. Concerns were also raised about the scope of official warnings being too broad. We consider the scope to be right and clear. Under the Bill, a warning can be issued in respect of a breach of a statutory provision, breach of a commission order or direction or breach of a trust or duty.
I will turn briefly to the concerns about extremism raised by my hon. Friend the Member for Congleton (Fiona Bruce). Extremism or the terrorist abuse of charities of any kind is very rare but must be addressed to protect public trust and confidence in charities. Although it may not represent most of the Charity Commission’s compliance work, it represents a serious risk to public trust and confidence. The reforms proposed in the Bill are not specifically focused on counter-terrorism or extremism—they would enable the commission better to tackle all types of abuse of charity—so the Bill does not seek to define extremism, nor should it. Charities and their work can be an important protection against extremism. We have no intention, as I said, of undermining freedom of religion or freedom of speech, and the Bill has been certified as compatible with the European convention on human rights.
Mr Wilson
I am going to finish there as I know that many Members want to get away from the Chamber today.
This Bill is about protecting charities and safeguarding their place in the public’s mind. It is about ensuring that charities will not fundraise in a manner that victimises the most vulnerable in our society, and it is about giving charities a new way to utilise their assets through social investment. Charities rely on the public’s trust and confidence. Abuse, where it happens, must be rooted out. These measures have broad support, as my right hon. Friend the Minister for the Cabinet Office said earlier: 83% of the public and 92% of charities support new powers being introduced for the commission.
Charities play a vital role in our communities and this Bill aims to bolster their position in the public’s trust and help them to continue the good works they have being doing for hundreds of years, continuing our country’s long and rich tradition of charity. On that basis, I commend the Bill to the House.
Question put and agreed to.
Bill accordingly read a Second time.
Charities (Protection and Social Investment) Bill [Lords] (Programme)
Motion made, and Question put forthwith (Standing Order No. 83A(7)),
That the following provisions shall apply to the Charities (Protection and Social Investment) Bill [Lords]:
Committal
(1) The Bill shall be committed to a Public Bill Committee.
Proceedings in Public Bill Committee
(2) Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Thursday 7 January 2016.
(3) The Public Bill Committee shall have leave to sit twice on the first day on which it meets.
Proceedings on Consideration and up to and including Third Reading
(4) Proceedings on Consideration and proceedings in legislative grand committee shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which proceedings on Consideration are commenced.
(5) Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.
(6) Standing Order No. 83B (Programming committees) shall not apply to proceedings on Consideration and up to and including Third Reading.
Other proceedings
(7) Any other proceedings on the Bill (including any proceedings on consideration of any message from the Lords) may be programmed. —(Sarah Newton.)
Question agreed to.
CHARITIES (PROTECTION AND SOCIAL INVESTMENT) BILL [LORDS] (Money)
Queen’s recommendation signified.
Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),
That, for the purposes of any Act resulting from the Charities (Protection and Social Investment) Bill [Lords], it is expedient to authorise the payment out of money provided by Parliament of any increase attributable to the Act in the sums payable under any other Act out of money so provided. —(Sarah Newton.)
Question agreed to.