David Jennings
Private individual
Private
4 Feb 2013

The issues being reported about the Charity Commissions ‘do nothing’ approach regarding, the morality of ' charitable status and tax avoidance' alleged to have been enacted by the Cup Trust could be ‘small fry’ if the Charity Commission Regulatory functions are reviewed.

It is clear over recent years the significant decline in Statutory Enquiry cases open within the Charity Commissions Compliance Unit, combined with the number of times the Charity Commission has sought recovery of misapplied assets or funds, referred for prosecution those charity controllers who have knowingly mislead or provided statutory returns that are ‘works of fiction’ is not unsurprisingly NIL….!The NIL return may well also relate to the Charity Commissions discharge of its other statutory and regulatory powers.

The Charity Commission simply do not check what they are told if it falls outside the organisational agenda. This issues would then relate to charities that are being ran for the benefit of their controllers or used to enjoy preferential trading positions ( no corporation tax, VAT or Business Rates etc etc). The Charity Commission simply does not check what it is being sent or told…

The Charity Commission does not appear to ‘regulate’ the sector or serve it well, the Charity Commission appear to have all the trappings (and public funding) of a highly credible or properly structured organisation….however when one asks about OUTCOMES of regulatory cases in terms of quality and quantity it becomes clear the Charity Commission does not use it statutory powers to any credible degree, if at all!

[Reply]

Adrian Beney
Partner
More Partnership
1 Feb 2013

It's rare that I feel moved to support something this Government has said, but Andrew Lansley's warning against an over-reaction to the Cup Trust scam is very welcome.

The case does raise all sorts of questions about the powers that the Charity Commission has, and the way in which it acts when it is, in its own words "not comfortable with the charity’s set-up".

But just because some unscrupulous people have exploited Gift Aid for their own greedy selfish purposes does not mean that the tax relief that charities and higher rate taxpayers receive is a bad thing. Indeed the whole Give it back George campaign demonstrated that much good comes of it. And research from real tax records in the Netherlands shows that a small decrease in tax relief on giving had a disproportionately larger effect on the amount people were giving.

So let's deal robustly with the scam by asking the Charity Commission to explain what it did next after it decided it was "not comfortable with the charity’s set-up". Who did officials talk to at HMRC, the Treasury and the Home Office about what could be done. Arguably this would have been a much more productive use of their time than pursuing the highly politicised public benefit agenda we've seen recently.

And we should not let government off the hook either, since it's this government that is responsible for the very significant decrease in the Commission's budget.

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