Stronger Charities for a Stronger Society (Charities Committee Report)

Lord Lea of Crondall Excerpts

Tuesday 16th January 2018 Lords Chamber

[Lord Lea of Crondall (Lab)]

My Lords, I welcome the report and take the opportunity to welcome my noble friend Lady Prosser to her role on the Front Bench replying to this debate.

I think that I may be about to rock the boat slightly, first on some general considerations and, secondly, on the specific issue of the Charity Commission’s interpretation and process of whether or not to judge a charity “political” and therefore ruled out from being registered for tax relief purposes.

Tax relief is a big driver; there is no doubt about it—I was going to say that it is a tax relief sector. In that sense, I am sure that from the Treasury’s perspective it is a public policy tool for various reasons, but that puts great pressure on the Charity Commission to get it right when it comes to registration. I do not have the numbers in my head, but I would guess that 80% of charities are registered charities. People may nod or shake their heads if I have got that wildly wrong, but there is a very strong incentive, as we all know, for a charity to get Charity Commission-registered status.

The Government in their reply underline the point that there has been a very big growth in the turnover in charities. It is £100 million or £100 billion—the number is in there, and I shall dig it out and get it right in a minute. It is a big number, and no wonder it is growing because, although the donors get the tax relief and not the charity, it means that we have this big growth.

This makes it extremely important that everybody is comfortable with the way in which the sector operates. This raises important questions—some of the ideas are outrageous and, although they do not come from my noble friend Lord Rooker, the issue he raised leads to them. In what sense do people working for charities think of themselves as being judged by different considerations to those who are maximising profits or whatever in any other sector of the economy? Sometimes it is not so obvious.

I put my name down to speak in this debate to register an interest of sorts—what I will call a negative financial interest—having failed to get charitable status from the Charity Commission for the Hammarskjöld Inquiry Trust. This meant that the £60,000 which it costs to run it comes out of my own pocket and nobody else’s. I had to pay every penny, including for visits to the United Nations in New York—the hotels, the lot. The Charity Commission refused charitable status because it said it was political. It had contacts in New York and said that the United Nations were not interested. Only last December, a further resolution, submitted to the United Nations by Sweden, was carried by 90 votes to zero. It recognised that there was considerable evidence that the death of Dag Hammarskjöld was associated with the presence of a second aeroplane. Six years before, the Charity Commission said that one reason for refusing charitable status was that there was no evidence that the United Nations was interested. Put that in your pipe and smoke it, Mr Shawcross, or anybody else who was involved at that time.

I was able to present a report to the United Nations a year after the trust was set up and it led to this inference being drawn and a considerable change to United Nations policy. I cannot go into more detail now, but the trustees were very distinguished, including a former Secretary-General of the Commonwealth, a former assistant general secretary for legal affairs at the United Nations, the former chief prosecutor to the Rwanda inquiry of the International Criminal Court and a former president of that court in The Hague.

I found the idea that we were a political body outrageous at the time. It is inconsistent that so many other groups, such as think tanks, which are doing more self-evidently political work are readily given charitable status. I do not know who got at the Charity Commission, either from the Foreign Office or anywhere else, but I do know that the decision was outrageous. I suggest that the political test should be more transparent, with a protocol setting out what the test is, so that we can all see it out in the open.