Have your say in the future of charity regulation

30 Apr 2021 Denise Copeland    Last updated: 10 May 2021

PDF icon Engagement meetings presentation1.31 MB

The closing date for responses to the independent review of charity regulation is 12 May 2021. Please take this opportunity to comment on changes that are needed to help voluntary and community organisations. 

The Independent Review Panel (the Panel) has held nine public engagement meetings with rural, small, medium and large charities to find out the issues that are particular to them.  They also held two meetings for the general public and focused meetings with solicitors, governance advisors, funders, accountants and independent examiners.  A brief summary of the key issues that emerged from these meetings can be found below and the presentation slides are attached. 

The Panel is stressing the need for all charities, and those that work with or advise them, to raise their issues with the current charity framework by completing their online questionnaire.  NICVA would also urge all charities and their stakeholders to complete this questionnaire.

Independent review of charity regulation questionnaire

What's your experience of charity regulation?

  Issues raised at all engagement meetings

One key issue that emerged across all the engagement meetings was the need to have more proportionate regulation for small charities.   In particular:

  • the need for a de-minimis threshold for registration so that very small organisations would not be required to register with the Commission and;
  • the need for a reporting threshold so that small charities do not need to have an independent examination and submit accounts to the Commission.  Many suggested that we should mirror the £25,000 threshold for accounts in England and Wales. 

Other issues raised that were common in most of the meetings include:

  • The Charitable Incorporated Organisation (CIO) needs to be introduced so that charities wouldn't have to register as companies to benefit from limited liability for the trustees and corporate identity. The CIO structure would then reduce the burden of dual registration and adherence to company law.
  • The Commission should provide more templates to help charities prepare accounts and annual reports.
  • Charities which are classified as Section 167 charities want the Section 167 register to be commenced so that charities registered in another jurisdiction can get registered here. Currently not able to access funding streams. 
  • Annual monitoring returns – can be difficult to extrapolate the information required from the accounts. Also, why does it require three separate documents to be uploaded when SORP accounts and reports are just one document? Need more guidance within the online AMR. 

Issues raised in some of the focused meetings include:

  • The threshold for the preparation and audit of group accounts needs to be raised.
  • Charities that exceed the income threshold in one year, out of the ordinary fundraising, have to then produce accrual accounts and/or get an audit for that particular year which is more expensive and time consuming.   A buffer year or two years is needed to allow charities to keep within the rules of their usual income threshold.  
  • The financial information that is displayed on the charity register can give the impression that a charity is spending too much to generate income in relation to spend on charitable activities (especially for those with group accounts), which isn’t an accurate picture of the finances.  Need more information on the charity register to explain this.   
  • Section 167 draft regulations need to be consulted on so that UK wide charities can see what is going to be required.  Section 167 charities want early engagement.
  • As cy-pres schemes were made by Commission staff, there is uncertainty whether these still stand in light of the High Court Decision - need clarity on this asap. 
  • Can CCNI work more closely with ROI charity regulator to streamline processes.
  • The Commission needs to be better resourced so that it can carry out all of its functions in a timely manner.
  • Given the quality of accounts and reports on the charity register, concerns were raised about the accuracy of it.  There’s a misconception that because the information is filed on time that its accurate.  Need the Commission to scrutinise more reports and accounts. 
  • Some funders are using the Charity Register to reduce bureaucracy in their own operations. A tick box exercise for them. Others glean good information from the information filed.   
  • Should be able to see on the charity register if trustees are trustees of other charities. 
  • Mixed opinions about whether assets should be included if a de-minimis threshold for registration was introduced.
  • Need to be able to redirect the funds from dormant charities on the combined list.

Issues raised about dealings with the Charity Commission include:

  • Matters of material significance and serious incident reports filed with the Commission but no response from the Commission.  Others were approached by Commission for more information.
  • Over punitive response in relation to accounts and reports being filed late. Accounts filed late in red writing stays on the charity register for a year even if accounts filed one day late.
  • Some felt that the Commission could do more to help charities and that they’re too focused on compliance.
  • In engaging with the Commission, some felt that it was very frustrating not being able to talk to staff, others that did get to talk to staff to seek advice were very positive about the helpfulness of the staff.
  • Commission website difficult to find guidance, search engine not good.  More guidance needed like CCEW. 
  • Need better clarity in guidance on ex-gratia payments to Trustees and staff.
  • Need clearer guidance on large reserves held by charities.
  • The tone of official correspondence from the Commission to charity trustees is too stern.
  • Participants that had been subject to a statutory investigation felt that the Commission didn’t fully understand their own powers.
  • Some raised issues about the Commission not investigating charities when concerns were raised to them.
  • Need the Commission to be more pro-active about getting information out, eg, there are not enough CCNI alerts going out. 
  • Some organisations are marked as ‘failed to apply’ on the combined list but the Commission used old contact details from HMRC so the charity didn’t know they were being called to apply. 

Delegation to Commission Staff

When asked about delegation to Commission staff, participants thought that:

  • Day to day routine work and straightforward consents should be dealt with by caseworkers
  • More complex work such as making schemes should be dealt with by the legal team
  • Statutory inquiries, decisions to remove or suspend a Trustee and appointment of an interim manager should be dealt with by the Charity Commissioners

Please complete the questionnaire 

Independent review of charity regulation questionnaire

The closing date for responses is 12 May 2021.

For more information on the independent review and engagement meetings click here.

To see NICVA's response please see the following link: 

NICVA response to the independent review of charity regulation | NICVA

denise.copeland@nicva.org's picture
by Denise Copeland

Governance and Charity Advice Manager

[email protected]

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