Charitable Incorporated Organisations (Insolvency and Dissolution) Regulations 2012

Debate between Lord Methuen and Baroness Hayter of Kentish Town

Tuesday 27th November 2012 Grand Committee

[Lord Methuen]

My Lords, as chairman of the trustees of an almshouse trust, we have been considering going the alternative way of incorporation. We welcome the measures and shall be examining them at our meeting on 7 December. We think that this is a much better way to go than the current incorporation methods. We welcome the protection that this will give our trustees and hope, as the noble Lord said, that it will encourage more people to come forward as trustees.

[Baroness Hayter of Kentish Town]

My Lords, I will try to resist the temptation to say that if the wit of man cannot get those two bodies to work together, perhaps the wit of women in the two organisations may be able to achieve that.

First, I should declare my interest as a trustee of various charities now and of even more over many years previously. Indeed, I have been caused much pain at earlier times by running non-incorporated charities, which often meant scuttling around London trying to get trustees’ signatures on property deals and, sadly, occasionally, trying to get death certificates for recently deceased trustees, often at a very sensitive time for the family, because there was some urgent legal or Charity Commission document that needed completing. In one case, I was dealing with a potential £1 million liability on individual trustees—one of them at that time a Member of your Lordships’ House—who, before I had advised them, had signed a document for a rather silly 25-year lease with, I believe, the Duke of Westminster, on a rather large property in Grosvenor Crescent. I should add that, once I took over, we rapidly incorporated it and that was the end of that.

I very much welcome the introduction of the charitable incorporated organisation structure, which, as has been said, will make this easier to access and cut out dual regulation on SORPs as well, on all the accounting rules which are also not quite the same for the two types of organisation.

As both the Minister and the noble Lord, Lord Hodgson of Astley Abbotts, said, the regulations are long overdue in introducing the new regime. They were legislated for in 2011, but the first will roll off the assembly line only early in spring of 2013. Given the Government’s desire, I am sure, to champion enterprise and the big society, we hope that they will move as fast as they can to facilitate the work of charities.

As the noble Lord, Lord Hodgson of Astley Abbotts, has said, the slow introduction has been a source of frustration for many charities, some of which unfortunately could no longer afford the wait or uncertainty and have had to incur the expense of becoming a company limited by guarantee under the existing rules. Nevertheless, single registration will undoubtedly reduce administration time and costs, with only one annual report and all that sort of thing, so we welcome it.