Charities (Protection and Social Investment) Bill [HL]

Lord Moynihan Excerpts

Wednesday 10th June 2015 Lords Chamber

[Lord Moynihan (Con)]

My Lords, first, I echo the congratulations which have been offered to my noble friend Lord Bridges, with whom I had the pleasure of working some 10 years ago when on my noble friend Lord Howard’s team. He had clear insight, humour and intelligence which shone through in all our dealings, and there is little doubt that he has replicated that again today and will enjoy life in your Lordships’ House.

I am very supportive of the principles of the Bill, and I declare my interests, which are in the register: I have worked closely with the Haberdashers’ Livery Company on its educational initiatives, and I have interests in a range of sports charities. I am conscious that there is one area which has been much debated in the context of the work of the Charity Commission—the often challenging subject of the public benefit requirement. That is a difficult issue because there are advantages to having clarity in the Bill but that would be complex and challenging, as is the guidance that is available. That debate needs to continue and I intend to raise it in a specific context—the advancement of amateur sport—in Committee.

The Charity Commission has recognised that there is room for improvement, and we need to help charities understand that, far from being an irrelevant distraction, the public benefit is one of the core questions of mission. It is about charities being clear what their aims are, who they serve and how they serve. No simple statutory definition of public benefit exists; it has therefore been contested and is subject to case law. Fee-charging schools have been recognised in the voluntary action research in the Sheffield Hallam University report as very well informed on the subject, yet they have been involved in costly Upper Tribunal cases. So there is uncertainty, misunderstanding on occasion and a lack of impact. This subject has led to opaque debate which I hope will be clarified.

The report concludes that if independent schools are to benefit from the privileges of the charity sector they have to be clear that charities are working for the public benefit in an understandable way. I believe that Parliament needs to define public benefit more precisely, as opposed to the alternative route at present, namely the Charity Commission developing practical guidelines. That is especially important since public benefit needs to be built in to the purposes of the charity.

I am not alone: the Select Committee on Public Administration report stated that the current position on the public benefit test has been,

“an administrative and financial disaster for the Charity Commission and for the charities involved”.

The Charities Act 2006 was considered to be “critically flawed” on the question of public benefit. The report said that the Act removed the presumption of public benefit from religious, educational and anti-poverty charities and required the Charity Commission to create guidance on public benefit, but it did not give a definition. The report stated that changes in the Act left the Charity Commission in an “impossible position” and led to costly Charity Tribunal cases involving independent schools, which I have mentioned. The committee said that the 2006 Act had absorbed vast amounts of energy and commitment, as well as money. Bernard Jenkin, from another place, said:

“We should never have opened up the whole can of worms called public benefit. Parliament needs to legislate, because the time and money being wasted suggests the act as it stands is not well-drafted and needs to be amended”.

I introduced the governance of sport Bill shortly before the election, in which I proposed that the Secretary of State for Education should table an annual report to Parliament for debate in both Houses entitled The Transformation of School Sport, documenting the state of sport in schools in England and Wales. Specifically relevant to today’s debate, I proposed that all schools should publish annually a report setting out policy in relation to sharing schools’ sports facilities and coaching expertise with state primary and secondary schools in order to benefit the local community. Effort made in the previous year to implement such a policy should also be covered. I took the view that all schools holding charitable status should submit reports as set out in Clause 4 and that the Charity Commission should take into account such reports in assessing whether the school continued to meet the public benefit requirement in Section 2(1)(b) of the Charities Act 2011.

In pursuing this objective, I believe that we should place public benefit on the face of the Bill. To avoid the complexity of a wide debate, I suggest that we legislate in a specific area of public benefit as it applies to the promotion of amateur sport, directed at independent schools holding charitable status. Those colleagues on all sides of your Lordships’ House who take a keen interest in sport will, I hope, take the opportunity in Committee to focus on the specific requirement for independent schools to deliver public benefit under the Charities Act. We will explore whether it is possible to define public benefit specifically to ensure that independent schools should be required to share their sports facilities and co-operate with primary schools in their catchment area. Many independent schools achieve this objective and achieve it admirably, through dual use of their facilities, engagement with local clubs in after-school hours, as well as coaching and pupil engagement. But there is a lack of clarity as to what specifically is required from schools to deliver public benefit under the Charities Act. The purpose of my intervention is to continue that dialogue between sports organisations, independent schools and those who will be in Committee as to whether primary legislation in this context is desirable.

Why do I raise the subject of sport? I have in the past highlighted the fact that more than 50% of our medallists at the Beijing Games came from independent schools. That means that half of all our medals for Team GB came from just 7% of the children in this country. In the excellent Ofsted report a year ago entitled Going the Extra Mile, Michael Wilshaw said:

“Only 7% of school-aged pupils attend an independent school in England at any point in time and only up to 14% of students aged 16 or above are reported to have attended an independent school at any point in their schooling. If maintained schools and independent schools were equally successful in nurturing sporting talent, we would expect approximately 86–93% of elite sportspeople to have been educated in a state school. However, 41% of the medallists from the UK team from the London 2012 Olympic Games were reported to have attended an independent school”.

I strongly believe that we need to address this imbalance. Independent schools are very well placed to play an important role in assisting state schools in their catchment area. That statistic of 41% of our medallists from Team GB in the London Games coming from 7% of our children means that thousands of talented young athletes are not being identified in the state sector. We have a duty to identify and develop that talent and to create a pathway for it from primary school to podium.

There are schools that are doing this outstandingly well. Their interpretation of the charitable requirement for public benefit is very clear. I cite Tonbridge School as an example. It works with 27 primary schools; it engages with those schools and provides the opportunity for boys to help with coaching, for state schools in the area to have access to its facilities and for a community action co-ordinator to work with those schools. Every year the school brings nearly 1,000 children from the primary schools in its catchment area to an Olympic day. It also sets up a freshers’ fair at the end of the day, when it invites local clubs, local community clubs and local sports clubs and the governing bodies to come to the school so that they can engage with the primary schoolchildren, their teachers and their parents to encourage them to become engaged in sport.

The best of our independent schools are doing exactly what I seek. The problem is that that is not a universal position for independent schools. I believe that focusing on the legislation before us, as we should, provides an opportunity to unlock the challenge and the real opportunity there will be for enabling public benefit to be interpreted in a very clear way to engage independent schools with local communities. If each of our independent schools built a relationship with the local primary schools and their local communities similar to that of Tonbridge School we would transform this country when it comes to the provision of sporting opportunity and engagement with the state schools and independent schools. That is much needed as part of our legacy from London 2012.

In closing, I cite John Claughton, chief master of King Edward’s School, Birmingham, who shares this vision. He identifies two kinds of resources: facilities and people, and says:

“Much good work has been done over the past decade or so in making the high quality facilities found in many independent schools available to local communities”—

a commitment, incidentally, that pre-dates discussions about charitable status and public benefit. There are numerous examples of partnerships with local schools and communities to be cited. He says:

“Not all former professional sportsmen and women have the skills or the desire to be both teachers and coaches. Many are excellent coaches but do not have the qualifications, desire or skills to be full-time teachers. These colleagues would enjoy working as full-time coaches across a variety of schools … Professional coaches employed (and frequently housed) by independent schools mainly work during the afternoons (when team sports are usually scheduled), early evenings, and at weekends. These members of staff could be employed on contracts where they spend some of their mornings (and non-sports afternoons) working in local state schools. The cost to the state schools would be low (calculated on an hourly basis without the additional costs of employment which are carried by the independent school) but would offset some of the costs incurred by the independent school”.

I believe that we have a far-reaching opportunity through this legislation to address a key, albeit complex, area of charity law. In so doing we can provide much-needed clarity over the concept of public benefit, reduce the Charity Commission’s focus on costly Charity Tribunal cases, and, above all, link our independent schools to state schools through the dual use of facilities and coaching to provide a genuine sports legacy to London 2012.