Earlier today both Houses of Parliament gathered to hear the Queen’s Speech, setting out the Government’s priorities for the duration of this Parliament.* Whilst headline measures include a Bill to enact a referendum on the UK’s membership of the EU in 2017 and a binding commitment to prevent increases in income tax, VAT and NI, a number of other measures will have repercussions for charities.
After a little bit of digging (explained below), most prominent is the proposed Charities (Protection and Social Investment) Bill which, it can expected, will include much of the content of the Draft Protection of Charities Bill. This proposed a number of new powers for the Charity Commission to ensure that it has the ability to crack down on any abuse of charity, with a broadening of the scope of the Commission to investigate alleged wrongdoing, and new ways of punishing those who have transgressed.
It is important that charities are trusted by the public, and this relationship also relies on the presence of a regulator to ensure that rules are being obeyed. In that sense, giving the Commission greater powers should be welcome, although the Government must ensure that any changes do not create onerous duties for those involved in charities or put people off working at charities or serving in governance roles. Of course, any such increase in the scope of the Commission must be supported by additional resourcing to ensure that it can regulate effectively.
This Bill is partially targeted at charities that overate overseas, where concerns have been raised in some quarters about the abuse of charities for terrorist purposes. Whilst it is of course important to tackle any such abuse, it is equally important that any legislation does not have the unintended effect of restricting the ability of legitimate charities to help those in need. Many charities play a vital role in providing humanitarian aid in conflict areas, where terrorist organisations operate, and the Government needs to understand concerns about any actions that would make it more difficult for donors in the UK to give to those suffering across the globe.
As the name suggests, the Bill also makes provision for developing social investment, something that was hinted at in the Conservative Party manifesto. Following recommendations from the Law Commission, the Bill will give charities a new power to make social investments (defined as those with both a financial and social return), along with clearly established duties.
Closer to home, the aforementioned changes to the tax system will have an impact upon donors. Increasing the minimum threshold for paying tax (the tax-free allowance) will have the subsequent effect of reducing the number of people eligible for Gift Aid which is something that charities should be aware of, particularly as it is part of a wider trend of taking people out of the tax system.
Whilst at first glance it would appear that there is little else of relevance to the voluntary sector, the reality is that charities will be affected by nearly every piece of legislation that the Government introduces, reflecting the integral role that they play in society. Measures to reform the NHS and education, changes to the welfare system, new proposals to support victims of crime and plans for a British Bill of Rights will all have an impact on organisations across the sector, and it is important that the Government commits to working in partnership with charities to ensure that any new legislation takes into account the concerns and aspirations of voluntary organisations.
As we know from our research over the election campaign, many charity workers do not believe that the needs of charities are properly taken into account by politicians and government. Given that, it was a little disappointing that the Queen’s Speech did not explicitly mention the Charities (Protection and Social Investment) Bill and outline the Government’s rationale in the way that she did for other Bills, which will do little to assure charities that they are being given the prominence that many feel they deserve.** Charities do a great deal of good in the UK, helping many of the most vulnerable people in society and making a visible contribution to communities on a daily basis – it is important that this contribution is not overlooked at the political set-pieces of the year.
In the coming weeks the Government will begin to publish the details of the Bills contained within the Queen’s Speech, which will give a better indication of the specifics of their proposals. Before Parliament breaks for summer recess we’ll also have another budget, which will give the Chancellor the opportunity to adjust the spending plans he set out in partnership with Liberal Democrat colleagues before the election. Join us on July 8th when we’ll be taking a close look at the plans of numbers, and trying to work out what it all means!
*Confusingly, in this context a ‘Parliament’ refers to a session of Parliament (a new one begins every one or two years), and is distinct from the electoral cycle in which a ‘Parliament’ will typically refer to the period between elections, IE 2015-2020.
**Even though the Queen unsurprisingly delivers the Queen’s Speech, it is actually written by the Government.