Parliament should use the opportunity of the current review of the Charities Act 2006 to revisit the issue of public benefit and produce clearer guidance for the sector and the Charity Commission, NCVO chief Sir Stuart Etherington told MPs yesterday.
Sir Stuart was responding to a query from Conservative MP Charlie Elphicke at a Public Administration Select Committee hearing on the regulation of charities and the Charities Act, as to whether “we should get rid of the whole concept of public benefit from the Act?”
Etherington rejected this suggestion but said that Parliament should certainly look at it again with a view to providing a clearer interpretation of what public benefit means.
He did not favour a definition on the face of the Act, as that would be “too unworkable and inflexible”, but suggested that the route taken by the Scottish Parliament in providing some guidance on how to assess public benefit, is worth looking at.
“Parliament did pass the buck because it didn’t really debate what is meant by public benefit,” Sir Stuart said. “And this is the place where that debate should take place and guidance should be given to the Charity Commission.”
MP: Hodgson ‘ignored public benefit problem’
LibDem MP Greg Mulholland went further and described the current situation with regard to public benefit as “a mess,” citing the different definitions of public benefit in the different parts of the UK, the Independent Schools Council case, and the Plymouth Brethren case.
Mulholland criticised Lord Hodgson for hardly addressing the public benefit issue at all in his report: “So the main problem arising from the Act has been dumped by the person who was told to review it.”
He said that the meaning of public benefit needs to be better clarified, or the whole concept of public benefit should be scrapped altogether in favour of “a much more laissez faire approach that allows charities to determine their own”.
Committee chair Bernard Jenkin MP closed the discussion by suggesting another way: “Instead of trying to harmonise, or de-devolutionise charity registration, why don’t we just say that if OSCR or the Charity Commission registers a charity, it is registered as British charity and able to operate in all parts of the United Kingdom.
“Then wouldn’t the public benefit issue naturally harmonise because if it didn’t harmonise there would be a certain amount of arbitrage between the different authorities.”
Sir Stuart replied that the “passporting issue” has been considered by the regulators before but never resolved. Jenkin suggested that was because legislative change was required, and asked Sir Stuart if he would oppose the idea if such change was effected. Sir Stuart said he would not.
