Charities face a growing burden of red tape from the Charity Commission, including a registration process which is almost twice as long as a year ago, a conference on charity regulation heard yesterday.
Jonathan Brinsden, a partner at law firm Bircham Dyson Bell, told the conference that the Charity Commission’s “continuous refrain” of a need for transparency has created a bureaucratic backlog.
“This manifests itself at the charity gateway with the Commission’s registration application being almost twice as long it was a year ago to complete – leading to the Commission seizing up in relation to complex cases.”
Brinsden, speaking in London at a Westminster Social Policy Forum conference, entitled Next steps for charity law, regulation and finance, also said that once charities have completed the Commission registration process they face a similarly complex process from HM Revenue & Customs which uses different language and requires different information.
He argued that this push towards greater transparency might actually punish “honest charities” and claimed that “none of this new compliance would have prevented a Cup Trust.”
“New compliance may only shine a light on the short comings of honest charities because the bad apples, with something to hide, will simply tick yes to all the questions.”
Charities are also having to endure rapidly increasing levels of scrutiny, Brinsden claimed, citing not just a growing number of statutory enquiries but also of “operational compliance” investigations which he said his firm found to be “quite inconsistent and open ended”.
“These sit below statutory enquiries, but they still have the look and feel of a serious investigation and the outcome may be published on the Commission’s website," he said.
"They often start with a great deal of vim and vigour but then have a tendency to whimper out without any formal resolution, which can be quite unsettling for trustees.”
Brinsden also questioned the “proportionality” of the ‘official warning’ powers which appears in the Draft Protection of Charities Bill, currently being considered by Parliament.
“The Charity Law Association is particularly concerned about what the context of when “official warnings” might be issued – will there be proportionality" he said.
“Will it be because a charity has not ticked a box on an annual return? And what implications might this black mark have for the reputation of a charity and its ability to fundraise?”
