Small Charitable Donations Bill

Sheila Gilmore Excerpts

Monday 26th November 2012 Commons Chamber

[Sheila Gilmore (Edinburgh East) (Lab)]

Being a member of a Public Bill Committee, particularly a Back-Bench member, can be a soul-destroying experience. It often seems to Opposition Members—under all Governments, I am sure; I do not intend to suggest otherwise—that what happens is this: the Committee debates the amendments that we have tabled, the Government generally oppose them, in some instances there is a vote, the Opposition generally lose the vote unless the Government have been uncommonly careless in losing some of their members somewhere in the building, and we move on to the next debate. However, that is probably not what the public think is involved in the scrutiny of a Bill in Committee.

When I became a member of the Committee, I wrote in my local newsletter that I was quite excited about it. Because the Bill did not appear to me to have created huge party political dividing lines, I believed that we would have the sort of opportunity for scrutiny that does not always arise. Unfortunately, however, there came a time when I began to feel that that was not the case, and that, for all my hopes that we would be open with one another about what was right and wrong with the Bill, we were merely engaging in those traditional Committee procedures. I was therefore extremely pleased to observe that the Minister, who had given little away in Committee, had tabled Government amendments on Report. That, I think, shows that he listened to what was said in Committee, and subsequently thought about difficulties that had been created during the drafting of the Bill but had not really been intended by legislators.

We must surely acknowledge that returning the time for which a charity must have existed before it can even claim under the scheme to two years, as the Government amendment proposes, would be an improvement, although our new clause takes a rather different approach. At least the amendment recognises that charities, particularly new charities, need a great deal of help. However, part of the problem with the Bill has been the fact that it is so strongly hitched to the gift aid mechanism.

It was assumed that small charities that could not obtain money through gift aid should be helped by means of the mechanism that already existed. That created a huge extra obstacle race. In fact, there will still be an obstacle race even if the Government amendments are accepted. The charity must be registered, it must have existed for a certain number of years—for the three years originally proposed, or for two—and it must be registered for gift aid. For all the reasons that have already been given, that can be quite a cumbersome process, particularly for small organisations that are entirely run by volunteers.

The whole apparatus of gift aid is quite complex, and the original mechanism involved a fairly lengthy process. It seemed to us in Committee that very small charities in particular were being expected to jump through a huge number of hoops to make their claims. Ironically, it appeared that they would be faced with far more obstacles than larger organisations which were claiming substantial amounts of gift aid, and that a scheme that had been intended to benefit small organisations was unduly elaborate.

--- Later in debate ---

[Sheila Gilmore]

The process of the Bill from start to finish, including the pre-legislative stage—as my hon. Friend the Member for Kilmarnock and Loudoun (Cathy Jamieson) mentioned—was very important. It is good to see that things can change. We sometimes become very rigid in this place—people take up positions and then cannot dig themselves out very easily without feeling a loss of face. A lot of improvements have been made, although some issues remain. The following may or may not prove to be the case; we will see how it works out in practice. During the pre-legislative scrutiny we attempted to grapple with the imbalance between organisations, whether national or regional in scope, which operate in such a way that each of their branches is a separate charity, and those which do not operate as a separate charity. Clearly, the Government listened to the concerns expressed, particularly by some churches, and made important changes. The by-product is a remaining complexity and an obstacle for organisations that cannot quite fit themselves into the model that has been adopted.

I hope that the ongoing review that the Minister at various times assured us will take place—regardless of whether there is a formal review built in for certain parts of the Bill—will look carefully at whether that model can be modified. It is genuinely difficult for some organisations to meet the requirements on where the money has to be collected and the reference to community buildings—linking not only where the collection takes place, but where the charitable activity takes place. There are numerous examples of organisations that do not fit into the model that has been adopted. It clearly fits the church model, where the charitable purpose takes place at precisely the same time as the donations—the collection—but constituent elements or branches of other charities that cannot fit that model may still be unable to take advantage of the provisions, even though they are collecting money and making exactly the kind of efforts that the Bill is designed to encourage.

Even though Opposition amendments and our suggestion of a clear review process have not been accepted by the Government—of course, it depends on what happens to the Bill in the other place; further amendments and suggestions may be made about how some obstacles could be smoothed further and ironed out—I hope that some of these issues will be looked at in coming years to ensure that the Bill does what we all say we want it to do and allows small charities, which take fairly low levels of collections that are critical to their operation, to be able to take advantage of it.