Public Administration Committee Report (Charity Commission)
Debate between Peter Bone and Bernard Jenkin
Mr Jenkin
I quite understand.
We received firm advice from the Attorney-General that we should treat the Preston Down case as sub judice to avoid prejudging any future tribunal decisions. In any case, it is not for PASC to determine the charitable status of individual cases.
The impact of the 2006 Act on the issue of public benefit and charitable status was at the centre of the inquiry. It has always been the case that charities must be established for charitable purposes only and that a charitable purpose must be “for the public benefit”, but the 2006 Act is said to have removed the presumption of public benefit from the list of headings that has historically existed, although case law prompts the question whether there ever was in fact such a presumption. However, the Act also placed a duty on the commission to publish guidance on public benefit, even though Parliament failed to define “public benefit” in the Act.
That aspect of the Act has been an administrative and financial disaster for the Charity Commission and for the charities involved, absorbing vast amounts of energy and commitment. Lord Hodgson describes the public benefit aspect of the Act as “a hospital pass”, inviting the commission to become involved in matters such as the charitable status of independent schools, which have long been a matter of political controversy.
We criticise the Charity Commission’s interpretation of the Act in some cases, but ultimately find that
“the Charities Act 2006 is critically flawed on the question of public benefit and should be revisited by Parliament”.
Mr Jenkin
I will give way to my hon. Friend when I am close to the end of my remarks.
We recommend that the presumption of public benefit in the 2006 Act should be repealed along with the Charity Commission’s statutory public benefit objective. The situation must be rectified with a new Act to allow the commission to focus on its proper job. Parliament, not the Charity Commission, should determine the criteria for charitable status and should not delegate them to an executive body.
We concluded that the other objectives for the Charity Commission set by the 2006 Act are also far too vague and aspirational in character—an all-too-frequent shortcoming of modern legislative drafting—to determine what the Charity Commission should do, given the limitations on its resources, to fulfil its statutory objectives.
Mr Jenkin
I am mindful of the hon. Gentleman’s point. We did not major on that during this inquiry, but it might be something to which we return. We recommend in our report that the Charity Commission and HMRC should work much more closely together. In fact, HMRC has the resource to investigate, penetrate and demand information about charities and their tax affairs and donors. In my personal opinion, it is as much a failure of HMRC as of the Charity Commission, but we recommend they work together more closely. What we have to be absolutely clear about is that the Charity Commission cannot start to conduct extensive investigations into the tax affairs of charities and their donors; it simply is not resourced to do so.
Mr Bone
May I refer to a different aspect of the report, on charitable status for religious institutions? Many such institutions feel that there has been creep by the Charity Commission in defining public benefit or, worse still, going to the tribunal to define it. From what the Chair of the Committee is saying, I gather that he thinks this is something that Parliament should revisit.
Mr Jenkin
That is exactly right. The legal advice we received on this question is quite clear: in the 1949 case of Gilmour v. Coats, the House of Lords made it clear that a cloistered religious order is not charitable, as any benefit is restricted to its members, who are a private class and not a sufficient section of the public. It has never been the case that every religious organisation is automatically charitable. However, the judgments in two other cases—Neville Estates v. Madden in 1962 and Re Banfield in 1968—were that a private religious group that is not wholly shut off from the world at large may be charitable.
The 2006 Act was not intended to introduce anything new, and it may have introduced some instability by requiring the commission to think up guidance on public benefit. That is what we feel was the real mistake—the apparent removal of the presumption and the requirement to produce guidance. If Parliament wants public benefit to be defined, it should define public benefit or it should leave the matter to the courts. Making the Charity Commission use its intervening judgment is what Lord Hodgson of Astley Abbotts described as the hospital pass.
Mr Jenkin
That is certainly correct. There has been widespread fear among many colleagues that the case presages a crackdown on religious groups by the Charity Commission. I believe the consistent message in our report is that we believe that too much has been laid at the door of the commission to determine. If Parliament wishes to legislate to provide additional restrictions against religious organisations, it is for Parliament to do that, but there is established case law, which I quoted earlier, that should determine whether or not a religious organisation becomes a charity. It is unfortunate that that particular case became so adversarial. It has to be said that the charity tribunal has not reduced the costs of litigation as was hoped, and there is scope to improve the practices of the commission in handling such disputes, so that vast amounts of the time and resources of the commission and charities, or potential charities, is not absorbed in paying lawyers to argue about how many angels there are on the head of a pin.
Publication Administration Committee Report (Smaller Government)
Debate between Peter Bone and Bernard Jenkin(13 years, 3 months ago)
Commons ChamberRead Full debate Read Hansard Text
Mr Jenkin
I am most interested that my hon. Friend should ask that question, because my Committee is considering the possibility of an inquiry into the impact on Departments of our relationship with the EU and looking for an academic who might support us in that work and help us to construct a cartography of the relationship between EU institutions and Whitehall Departments.
The total number of Ministers has grown steadily since 1900. Our report examines whether revising the role of Ministers could provide a way of reducing their numbers. We took evidence from current and former Ministers, as well as from academics and senior civil servants, and we were left in no doubt that Ministers have a very heavy work load. Lord Smith of Finsbury, a former Culture Secretary, said that the amount of paperwork he had to contend with was “plainly ludicrous” and
“no way to run a life let alone a country”.
It is less clear whether all that Ministers do has to be done by a Minister of the Crown. Chris Mullin, in his autobiography, noted his role as “a glorified correspondence clerk” and lamented:
“So much ministerial activity is entirely contrived and pointless.”
Mr Peter Bone (Wellingborough) (Con)
My hon. Friend is making a wonderful statement, and I agree entirely with his comments. Is this not just “Yes Minister” reinventing itself, like in that wonderful episode, where it is explained: “When you get a new Minister, what you do is fill his diary and give him plenty of paperwork so he never makes a decision on anything”?
Mr Jenkin
We looked at that suggestion, but it is rather difficult because there is no legal definition of a PPS. However, they are referred to in the ministerial code. I wonder whether something procedural could be done under Standing Orders to formalise the arrangement, or whether they could be given statutory status. However, that is a step further than our report went.
Mr Bone
Is not one of the problems that we have at the moment that very good Members of Parliament get elected to Select Committees, and then as soon as they are offered a job as a PPS, they disappear from the Select Committee where they are carrying out scrutiny and become a bag carrier?
Mr Jenkin
I am most grateful to my hon. Friend for that point, because the large number of PPSs does rob Select Committees of the talent that they need to function effectively. Very often, the most able Members are selected as PPSs and taken away from Select Committees.
To conclude, the academics who appeared before us agreed for the longer term with the suggestion made by Lord Hurd in the previous Parliament that the abolition of
“20 Ministerial posts at different levels would not only be popular but would be followed immediately by an adjustment of workload.”
We therefore repeat the recommendation made in our original report that, over the course of this Parliament, the total number of Ministers should be reduced to 80, shared between the Commons and the Lords. We welcome the fact that the Government’s thinking seems to be moving in that direction. The Deputy Leader of the House said last year that
“it is likely that at some stage in the future we will reduce the number of Ministers.”—[Official Report, 25 October 2010; Vol. 517, c. 129.]
I welcome that. I hope that the report will encourage the Government to move in that direction faster, and to review the number and functions of Ministers in a way that strengthens Parliament and delivers a better quality of government.
Question put and agreed to.