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Parliamentary Debates House of Commons Official Report General Committees PARLIAMENTARY DEBATES HOUSE OF COMMONS OFFICIAL REPORT GENERAL COMMITTEES Public Bill Committee CHARITIES (PROTECTION AND SOCIAL INVESTMENT) BILL [LORDS] Fifth Sitting Thursday 7 January 2016 CONTENTS New clauses considered. Bill, as amended, to be reported. Written evidence reported to the House. PUBLISHED BY AUTHORITY OF THE HOUSE OF COMMONS LONDON – THE STATIONERY OFFICE LIMITED PBC (Bill 069) 2015 - 2016 No proofs can be supplied. Corrigenda slips may be published with Bound Volume editions. Corrigenda that Members suggest should be clearly marked in a copy of the report—not telephoned—and must be received in the Editor’s Room, House of Commons, not later than Monday 11 January 2016 STRICT ADHERENCE TO THIS ARRANGEMENT WILL GREATLY FACILITATE THE PROMPT PUBLICATION OF THE BOUND VOLUMES OF PROCEEDINGS IN GENERAL COMMITTEES © Parliamentary Copyright House of Commons 2016 This publication may be reproduced under the terms of the Open Parliament licence, which is published at www.parliament.uk/site-information/copyright/. 105 Public Bill Committee7 JANUARY 2016 Charities (Protection and Social 106 Investment) Bill [Lords] The Committee consisted of the following Members: Chairs: †FABIAN HAMILTON,MRS ANNE MAIN † Churchill, Jo (Bury St Edmunds) (Con) Stevens, Jo (Cardiff Central) (Lab) † Haigh, Louise (Sheffield, Heeley) (Lab) † Streeting, Wes (Ilford North) (Lab) † Jenrick, Robert (Newark) (Con) † Throup, Maggie (Erewash) (Con) † Johnson, Gareth (Dartford) (Con) † Tugendhat, Tom (Tonbridge and Malling) (Con) † Kyle, Peter (Hove) (Lab) † Turley, Anna (Redcar) (Lab/Co-op) † Lefroy, Jeremy (Stafford) (Con) † Wilson, Mr Rob (Minister for Civil Society) † McGinn, Conor (St Helens North) (Lab) † Mak, Mr Alan (Havant) (Con) Marek Kubala, Ben Williams, Committee Clerks † Morton, Wendy (Aldridge-Brownhills) (Con) † Newton, Sarah (Truro and Falmouth) (Con) † attended the Committee 107 Public Bill CommitteeHOUSE OF COMMONS Charities (Protection and Social 108 Investment) Bill [Lords] May I begin by congratulating you, Mr Hamilton, on Public Bill Committee your promotion to a shadow foreign affairs post? I know that you will put your enormous experience to Thursday 7 January 2016 good use on behalf of your party. Most people will be familiar with the issues surrounding charitable fundraising by large charities that surfaced [FABIAN HAMILTON in the Chair] last summer, and which I referred to in some detail in relation to clause 14. As I said, I accepted Sir Stuart Charities (Protection and Social Etherington’s recommendation to give charities a final Investment) Bill [Lords] chance to make the self-regulation of fundraising work. The new system has my complete support, and the public are eager to see improved fundraising and signs New Clause 7 that charities are listening to and acting on their concerns. It is now up to the sector to make the improved system RESERVE POWERS TO CONTROL FUND-RAISING of self-regulation work in a timely and effective manner, ‘(1) The Charities Act 1992 is amended as follows. and I will keep a close eye on the progress being made. (2) In Part 2, after section 64A (reserve power to control Charities rely on the generous charitable giving and fund-raising by charitable institutions) insert— voluntary work of the British public and so need to “64B Reserve power in relation to fund-raising regulators deliver on the public’s expectations. Otherwise, we must (1) Regulations under section 64A may, in particular, impose be prepared to step in and act. I do not want to have to on charitable institutions requirements to do any of the do that, but I want to be prepared in case it becomes following— necessary. Public trust and confidence in charities has (a) to comply with requirements imposed by a regulator; already been rocked because of the poor practice uncovered (b) to have regard to guidance issued by a regulator; last summer. In a survey last year, only 48% of people—less (c) to be registered with a regulator for the purpose of its than half—said that they trusted charities. A more regulation of charity fund-raising. recent survey found that 76% of the public wanted (2) “Regulator” means a body specified in the regulations as a tougher regulation of charity fundraising. We cannot regulator for the purposes of this section. allow further damage to public trust, which is why it is (3) A body may be specified as a regulator for the purposes of imperative that we have the right tools to act if it this section only if the regulation of charity fund-raising appears becomes clear that the new system is not sufficiently to the Minister to be a principal function of the body. supported by charities. For that reason, I propose an (4) A body maintained out of money provided by Parliament amendment, through new clause 7, to the existing reserve may not be specified as a regulator (and this section does powers in the Charities Act 1992. This will act as a not confer power by regulations to establish a body to act as safeguard should self-regulation fail. regulator).” Proposed new section 64B of the 1992 Act will extend (3) In Part 2, after section 64B insert— existing powers in relation to fundraising regulation to “64C Reserve power to confer additional powers on compel charities to comply with the requirements and Charity Commission guidance imposed by the fundraising regulator. It will (1) In the case of charity fund-raising which— also allow the Government to require charities to be (a) is carried on by a charity, a person managing a charity registered with a body for the purpose of regulating or a person or company connected with a charity, or charitable fundraising. Under this provision, Ministers (b) involves soliciting or otherwise procuring funds for the will have the discretion to mandate with the regulation benefit of a charity or a company connected with a of charity fundraising any body whose principal function charity, or for charitable purposes, appears to be in line with that purpose. The provision regulations under section 64A may, in particular, make makes it clear that that may not be a body maintained provision conferring functions on the Charity Commission, out of money provided by Parliament. That will be the including provision applying or reproducing, with or without case with the new fundraising regulator currently being modification, any provision of the Charities Act 2011. established by Lord Grade of Yarmouth, the interim (2) The regulations may provide for a power that is exercisable chair, and Stephen Dunmore, the interim chief executive, by the Commission by virtue of the regulations to be exercisable which will be funded by the sector itself. by a person appointed by the Commission for the purpose.” (4) In section 64A(2) after “this section”insert “and sections 64B Most of the largest charities have already committed and 64C”. to registering with the new body once it is established, (5) In section 77(4) (regulations and orders) at the end insert and I am sure that any charity showing initiative and “and, in the case of regulations made by virtue of section 64B or commitment in that way will be a welcome sign to both 64C, shall in particular consult the Charity Commission.””.’— the public and Parliament. However, should any charities (Mr Rob Wilson.) be found to be dragging their heels, this power could be This is a new clause to extend the existing reserve power to regulate used to compel them to register with the fundraising charity fund-raising (in s.64A of the Charities Act 1992). If exercised, regulator. It could be used as a first statutory step the power could require mandatory registration and compliance with a should charities prove insufficiently proactive in their specified fund-raising regulator or for fund-raising regulation to be support of the new self-regulatory system. carried out by the Charity Commission. Brought up, and read the First time. Self-regulation will not work if charities decide to wait and see what the finished system looks like before pledging their support. It would be starved of both the 11.30 am necessary mandate and the financial resources even to The Minister for Civil Society (Mr Rob Wilson): I beg begin its work. This power will therefore be a vital to move, That the clause be read a Second time. safeguard to ensure that self-regulation is given a proper 109 Public Bill Committee7 JANUARY 2016 Charities (Protection and Social 110 Investment) Bill [Lords] chance to succeed. If needed, the power would further sure that that body is up and working so that the sector act as an early warning sign to charities, flagging it up does not make the terrible mistakes it has made in the to them that they are falling behind the expectations past. that the public, Parliament and the Government have of It is also important to recognise that it is a small what is necessary to make self-regulation work. I would number of large charities that have let the whole sector challenge any fundraising charities and, in particular, down and that, by and large, small charities have had large, sector-leading charities that did not sign up to the nothing to do with this. We are therefore having to focus new self-regulator to consider their obligation to safeguard on a fairly narrow section of the sector, but that work is the public and their trust in charities more generally. It important, because we have seen the figures for those would certainly be a poor reflection on what is largely a who trust charities go down to below half the population—it dedicated, compassionate and well-run sector if the was previously much higher—and that has had an Government were forced to invoke this power.
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