Draft Protection of Charities Bill

The Charity Commission’s powers and its role in regulating charities have come under increased scrutiny with some high profile cases and the publication of a number of recent reports. There has been particular criticism of the compliance and enforcement work of the Charity Commission, including its perceived reluctance to use the powers available, its perceived lack of focus on dealing with serious wrongdoing, and its use of its reduced resources. The powers and performance of the Charity Commission have also been considered in the context of combatting extremism and tax avoidance.

The Government and the Charity Commission have pointed to the recent increase in the Commission’s use of its compliance and enforcement powers, but both agree that strengthened powers are needed.

In December 2013, the Government published a consultation paper which included seventeen proposals for change requested by the Charity Commission to extend the Commission’s powers to tackle abuse in charities. In summary, the proposals related to automatic disqualification from trusteeship; a new power for the Charity Commission to disqualify a person from charity trusteeship; other provisions relating to trustee disqualification; and proposed changes to other Charity Commission compliance powers.

In October 2014, the Government published the draft Protection of Charities Bill. The draft Bill includes provisions dealing with ten of the original seventeen consultation proposals, some of which have been modified.

The Government’s Explanatory Notes published with the draft Bill state that it would:

• provide stronger protection for charities in England and Wales from individuals who are unfit to be charity trustees, and

• equip the Charity Commission with new or strengthened powers to tackle abuse of charity more effectively and efficiently.

The draft Bill would extend to England and Wales only. It will be subject to pre-legislative scrutiny by a joint committee of the two Houses of Parliament.