Labour and Liberal Democrat MPs yesterday denounced Eric Pickles’ assertion that charities would be stripped of grants if they campaigned against government, and said they would reverse such measures if they held power after the election.

Pickles released a statement last week on gov.uk saying that charities could not use taxpayers’ funds to lobby government. He said there was a widespread practice of government funding charities as "sock puppets" to lobby itself.

Labour MP Lisa Nandy, who was speaking at an All Party Parliamentary Group on Civil Society and Volunteering, said her party did not accept Mr Pickles’ comments.

“We’re learning nothing here," she said. "We’ve had the shambles of the Lobbying Act and now we have this.

“I think, looking at the statement, Pickles is making a distinction between funds that are directly given to charities by government and funding that they get from elsewhere, but how do you tell the difference?

“The real problem is not whether there will be organisations that continue to do what they do, but that there will be many who don’t because they can’t work out how to tell the difference (between government grants and other funds).”

Paul Burstow of the Lib Dems labelled Mr Pickles’ statement “a crazy idea” while speaking at an Acevo conference.

“It’s an absolutely crazy idea that you can improve public services and policy by gagging those who can bring the lived experience of the people who use those services and the people who benefit from those policies. So it really won’t be something the Lib Dems want to see become a reality.”

Umbrella bodies condemn Pickles

Condemnation for Pickles’ pronouncement have also come from voluntary sector umbrella bodies, with both NCVO and Acevo releasing statements.

A spokesperson for NCVO said: “we wrote last week to the secretary of state to raise concerns about the clause and seek further clarity on its intended operation. We have a meeting with the permanent secretary later this week at which we will discuss the matter.”

Acevo chief executive Sir Stephen Bubb also strongly denounced the pronouncement as “an absolutely unacceptable policy decision.”

“With classic, ‘Bubb understatement’, I described this as squalid, and that is just what it is. It misunderstands our role in ensuring effective policy making in government.

"I really, strongly hope that no one in NHS England and the Department of Health will follow suit.”

Additional reporting by Emily Corfe