UK Charity Regulator’s New ‘Get Tough’ Policy

The UK Charity Commission has come out swinging after a recent report criticised its operations saying its newly appointed board is determined to improve the regulator’s performance, taking on a tough new stance with charities that fail to comply with the law.

The Chairman of the Charity Commission, William Shawcross, told a charity audience that the regulator's new board is "grasping the nettle" and improving the Commission’s performance to ensure the regulator promotes public trust and confidence in charities.

The Commission has already appointed a former high ranking police officer to its new board.

The UK Charity Commission is the independent regulator of charities in England and Wales.

Speaking at a Charity Symposium in London, Shawcross acknowledged that the Commission, and charities, had come under fire in recent months and assured the audience that the Commission is now "concentrating on tackling the real problems that we and our friends and critics have identified".

William Shawcross referred to the criticisms made in a recent report by the Public Accounts Committee.

"I do not agree with all of the criticisms the Committee made. But the Committee is right in one respect: the Commission can and must do more to take action against charities that fail to comply with the law and bring other charities into disrepute as a result,” Shawcross said.

“Since taking over the Commission, I have appointed a brand new board of exceptionally talented people who are determined to improve the Commission's performance. Among our new board members is Peter Clarke, who is a former Deputy Assistant Commissioner in the Metropolitan Police Service, where he was Head of the Anti-Terrorist Branch and National Co-ordinator of Terrorist Investigations.

“Peter Clarke is only one of many new board members who symbolise the fact that the Charity Commission means business. We intend to ensure that charities comply with the letter and the spirit of the law. And that therefore the public can have confidence in donating to charities. Under the leadership of the new board, we have already begun to make improvements."

Shawcross cited three areas in which the new board had begun to introduce changes: the regulator's approach to serious non-compliance; its approach to charities that repeatedly fail to file their accounts; and its work to prevent and tackle terrorist abuse of charities.

Referring to the Commission's investigatory work, he said the regulator has, "often given trustees too many opportunities to resolve problems themselves, before we took definitive regulatory action" and confirmed that the new board is determined to "get tougher with charities who do not comply and are under investigation".

But he stressed that the Commission's approach must reflect the voluntary nature of the sector.

"We must be careful. We have a really difficult line to tread. We are the regulator of charities, the policeman when we have to be. But we must not become the Stasi of the charitable world,” Shawcross said.   

“Deliberate abuse in charities is not the norm. For every trustee who commits abuse there are a thousand whose intentions are good. They make mistakes but these are rarely venal. We must not come down like a ton of bricks on those trustees who are just a bit too laid back. Instead we must continue to give the well-intentioned majority the tools they need to keep their charities on the straight and narrow. We must, for example, continue to produce web based guidance that helps trustees understand what the law expects of them. This is a very important part of our work."

Shawcross also emphasised trustees' duties to explain their decisions to the public, citing executive pay as an example.

"If trustees feel it is in their charity's interest to pay high salaries to attract talented people, then they should have the courage of their conviction and explain their decisions publicly. There is no point in moaning how difficult and vital the job is in the 21st century. They must step up and take responsibility for keeping the public informed and for maintaining public support,” Shawcross said.

“No-one else is going to do this on charities' behalf. I'm delighted, therefore, about the National Council of Voluntary Organisations' plan to develop an advisory code for trustees on senior staff salaries. This is a great example of a charity-led initiative aimed at providing guidance to charities and information to the public."

Australia’s charity regulator, the Australian Charities and Not-for-profits Commission is in a holding position waiting the new Coalition Government’s directions.

New Social Services Minister Kevin Andrews told the sector before the Federal election that the coalition would dismantle the ACNC and replace it with a education body.