It is "unacceptable" for the Charity Commission to rely on the Treasury for all its future funding because of the risk of further cuts to its income, the chair of the regulator, William Shawcross, said yesterday.

He said he was instead exploring the idea that charities should pay for the Commission themselves, and that senior individuals in the sector had proved "open to the idea" because they acknowledge "how important it is that their regulator is well funded".

Shawcross was speaking in London at the first in the Charity Conversations series, hosted by investment firm Rathbones.

"So long as the Commission relies on the Treasury for our funding, we will always be at risk of further cuts," he said. "This is unacceptable to me. It puts public trust in charities at risk."

He said that at the moment the Commission existed "on a financial cliff edge" and could not absorb any further cuts to its budget.

He said the Commission was exploring "ways of placing the Commission’s funding on a more secure footing" and that these included "funding in whole or in part by charities themselves".

But he said no plans were yet in place to introduce a new funding model.

"At this time, I am simply having conversations with senior charity people to understand their perspective," he said.

"So far, the people I have spoken to have been open to the idea – charities have always acknowledged how important it is that their regulator is well funded.

"But of course there are those who have concerns. There are indeed very real questions to answer – including how the Commission’s independence, which is so vital, would be protected under such an arrangement."