Charity Commission

Baroness Pitkeathley Excerpts

Thursday 27th February 2014 Grand Committee

[Baroness Pitkeathley (Lab)]

My Lords, I declare an interest as chair of the All-Party Group on Civil Society and Volunteering.

I congratulate the noble Baroness on securing this debate. She will not be surprised to see that the usual suspects are gathered here today—that is, those noble Lords with an interest in and commitment to the charitable sector. For most of us it is a commitment of many years’ standing. I certainly remember the Deakin review extremely well.

None of us can therefore deny that the way in which the Charity Commission has been operating in recent times has been a cause for concern. The series of reports mentioned by the noble Baroness, Lady Barker, make dismal reading. The PAC report of 5 February this year concludes in no uncertain terms that the commission continues to perform poorly and is failing to regulate charities effectively. The reasons for this have been well rehearsed. It has been too slow; too reactive rather than proactive; too narrow and legalistic in its approach to regulation; and, as the noble Baroness, Lady Barker, clearly stated, there has been confusion about its primary purpose. Is it there to support the voluntary sector or to protect the public interest?

In addition there has been a constant problem with resources. Is the commission being asked to do too much with too little? Undoubtedly the commission, like much of the charitable sector, has taken a severe financial hit in recent times and has had to reduce staff drastically.

Much controversy has surrounded the commission, not helped perhaps by changes of personnel at the top. The appointment of a new chief executive—which I understand will shortly be announced—will be of the utmost importance. It is vital that this person has the skills and experience to enable the commission to fulfil its important role, to be clear about its mission and to provide authoritative leadership, especially in developing strategic alliances.

It is certain that, in spite of the controversy, there is universal agreement within the sector that it needs an independent and effective regulator which focuses entirely on charities. For example, trusts and foundations which give grants to other charities have to give due diligence, and the less the Charity Commission does the more the trusts and foundations have to do. So there may be duplicated effort using donated money rather than the public money which enables the Charity Commission to do this kind of due diligence on which trusts and foundations and others who give money were habitually able to rely. It is vital that we continue with that.

Therefore the Charity Commission’s move to take firmer, swifter action with the few charities which offend—we should remember that, although there have been serious cases, few charities offend—and its desire to enhance further its legal powers has met with nothing but support from the charitable sector. Better use of data, as the noble Baroness reminded us, and closer working with HMRC are also moves in the right direction. The Government would be well advised to banish all thoughts of merger with HMRC, should they have such thoughts, which I hope they have not. If the Charity Commission continues with its programme of reform and delivers the changes it is promising, the Government must do their part to ensure that they provide realistic funding for this important—indeed vital—organisation.