What are the Latest Updates in the Charity Sector?

Launch of the National Emergencies Trust

After the Grenfell Tower tragedy, the Charity Commission launched an initiative to review how the voluntary sector can best respond in the event of future national disasters and emergencies. The new initiative builds on the experience of the Disasters and Emergencies Committee, which deals with international crises.

The National Emergencies initiative, launched at the end of 2019, to establish a new charity, NET to support the UK voluntary sector in raising funds to provide a collaborative response to major crises. Local charities will be encouraged to work through a single national fund set up by NET with the aim to help direct fundraising. NET will also provide expertise on the allocation of funds and work through local grant distributors.

The Trust has launched its coronavirus appeal earlier this month to raise funds to help local charities in their work during the Covid-19 pandemic.

Updated Guidance on Safeguarding

The Commission has refreshed its safeguarding guidance, with a view to helping charities understand their legal duties to protect people who come into contact with their charity.

The updated guidance now includes advice on:

• how to turn safeguarding principles into practice
• when to consider making criminal checks
• when to consider making other checks

For a full update on this, please see our recent article about the changes to the guidance

How Can Charities Invest in Line With Their Purpose and Values?

The Commission is currently seeking views on current considerations around responsible or ethical investments.

The aim of seeking views is to understand how charities are able to reconcile achieving good financial returns with responsible investments consistent with their charity's purpose and values, alongside any barriers that may be preventing them from achieving this.

The Commission will be seeking views until Tuesday 31 March 2020 and has requested that contributions are emailed to: policy@charitycommission.gov.uk .

A Review of Complaints and Reports about Charities

The Commission has recently published a review of complaints and reports about charities which fall below the threshold for regulatory action.

The review indicates that:

• in most cases, complaints came from people connected with that charity (supporters, beneficiaries, members, volunteers, staff or trustees)
• they complained about issues that affected them personally
• many of the complaints were about matters that charities had not dealt with effectively, and people felt charities had dismissed or ignored their concerns

Key messages from the report are for charities to be accountable when it comes to complaints or when people raise concerns, and for charities to embed good practice, appropriate attitudes and behaviour.

Summary of Recent Commission Inquiries

• All Nations Community Centre - the Commission identified concerns about failures to file annual reports, returns and accounts, alongside failures in serious incident reporting and the charity's operation of a bar on its premises. All accounts, reports and annual returns have now been submitted. Following advice from the Commission, the charity has now established a trading subsidiary to operate the bar, separating the non-charitable arm of its activities.
• Foundation for Relief and Reconciliation in the Middle East - following a serious incident report, concerns had been raised that a trustee had transferred funds in their personal capacity to Islamic State, a proscribed terrorist organisation, to secure the release of hostages. There was evidence to suggest that the funds had been raised by the trustee through donations. The Commission reported the information to the police and suspended the trustee during the investigation. The trustees of the charity suspended the trustee. Three new trustees and a new CEO have been appointed and risk management processes updated.
• Chichester and District Dog Rescue Society - following the Independent Examiner reporting discrepancies in the charity's bookkeeping, the Commission reviewed the charity's financial records and identified concerns about the charity's financial control procedures and governance. The trustees had failed to keep the necessary records and comply with their statutory filing requirements. The charity had also used funds for purposes in breach of its governing documents by funding veterinary services. The chairman and trustee board have requested guidance and advice from the Commission and the charity is now fully compliant with its filing obligations.

Updated Guidance for Exempt Charities

The Charity Commission has updated its guidance on exempt charities (CC23). The changes mainly relate to Higher Education Institutions (HEIs). HEIs are exempt charities as they are regulated by the Office for Students (OfS), rather than the Charity Commission. The update gives effect to the changes to the Charities Act 2011, introduced by the Higher Education and Research Act 2017 (Further Implementation etc.) Regulations 2019 (SI 2019/1027).

These amendments (which came into force from 1 August 2019):

• enable any higher education provider, which is constituted as a charity and registered with the OfS, to become an exempt charity by an Order in Council (i.e. an order issued by the Privy Council)
• remove exempt charity status from any higher education provider that ceases to be registered with the OfS.

Aside from the changes for HEIs, the Commission continues to focus on serious incident reporting, as early on in the guidance it mentions that exempt charities should check the requirements of their principal regulator (for HEIs, this is the OfS).

The guidance also highlights that thirteen years after the Charities Act 2006, registered societies are still exempt and still have no principal regulator.

The Commission's First Appointment of an Interim Manager of 2020

The Commission has appointed an interim manager to CAWRM Ltd, known as Jerusalem Merit - a charity which aims to relieve poverty and financial hardship, particularly amongst refugees in the Middle East.

This follows an inquiry into CAWRM Ltd opened by the Commission in November 2018, investigating concerns about the charity’s management and finances.

Interim managers are only appointed by the Commission as a temporary and protective step. This is where the Commission has identified misconduct or mismanagement in the administration of a charity, or where necessary to protect a charity’s property.

For CAWRM Ltd, the interim manager has been appointed to assess specific issues and the charity’s viability. The publication of further appointments was anticipated at the time of writing.

For further information in relation to the appointment of interim managers, or to speak to one of our authorised interim managers, please contact Shivaji Shiva in our Charities team on 0121 227 3724, or complete the form below.