Charity finance policy Governance, regulation and compliance

Has the Charity Commission has taken the wrong tone in its election guidance

The charities regulator in England and Wales recently wrote to its whole database to warn them of their duties when campaigning. David Ainsworth asks if the Commission struck the right tone.

Last week, the Charity Commission issued a widespread communication to trustees and others, outlining what charities needed to do to comply with the law during the general election. It drew some criticism from across the sector, with several other infrastructure bodies questioning the tone, and saying that it would potentially make charities shy away from legitimate campaigning.

We share some of these concerns. The Commission is of course right to draw attention to the law, and ensure that charities comply with it, but it faces a difficult balancing act. Its mere presence in trustees’ lives creates a certain nervousness – a better-safe-than-sorry feeling. By simply joining the debate, the Commission can cause people to stop what they are doing and think again. Even charities engaging in totally legal and reasonable activities. To us – although not to all in the sector, it must be said – its choice of language felt quite proscriptive.

It is our concern that charities may find themselves worrying too much, and avoid legitimate campaigning. Risk assessment and over-compliance may prevent charities from doing what is best for beneficiaries.

There are limitations in law, and charity leaders do need to make themselves familiar with the Lobbying Act and the relevant guidance, CC9. But we would ask charities to be aware that there is still room to take a position. If you think a particular policy is good or bad for your beneficiaries, it would be worrying if you could not say so.

Our worry is less about the rules, which offer charities significant scope to campaign, and more about the mood music which underlies it.


Where does this come from?

The latest communiqué from the Charity Commission must be viewed in the context of several recent speeches from the current chair, suggesting that charities face a crisis in public trust. The regulator’s message is that we must do more to satisfy the public that our sector is worthy of support.

The regulator’s narrative is a disapproving and disappointed one, and it has elicited a similarly disapproving and disappointed response from much of the charity infrastructure.

So where does the narrative come from, and is it fair?

Here, again, it’s important to take a nuanced view.

The regulator’s position is not without legitimacy. There clearly is a level of public concern about trust in charities. If there were not, people would not read newspaper articles about it. And it’s definitely the case that the Commission’s last two surveys do show a significant fall in public trust.

It’s worth asking where that comes from, though. Is it real, or is it based on what’s been in the papers over the last couple of years? Do the public say they distrust charities because they read articles raising concerns? Or do journalists write articles because they know their audience distrust charities?

The answer is, it has to be a bit of both. You cannot get people to read articles about topics they are not already interested in, but it’s undoubtedly the case that those articles amplify and worsen the situation.

We know that in both 2016 and 2018, just before the Commission carried out its surveys, there were major public scandals. We know that recent events have a significant but temporary impact on people’s emotions – 62 per cent of respondents to the Commission’s own survey cited recent stories as affecting their response. So we have to suspect that the moment charities are out of the papers, trust levels will bounce back.


So do we really have a problem?

We also know that the Commission has extrapolated the results to show that the whole sector has a trust problem, particularly since the advent of its most recent chair, Baroness Stowell.

But the data simply doesn’t support this. Its figures show that its respondents were only talking about very large charities, and only those working in five fields: health, children, animals, the elderly, and aid. So the data actually records trust levels for less than 100 charities.

This doesn’t let us off the hook, though. Charities have never been as trusted as other institutions such as the armed forces, the NHS. So another way of looking at it might be not to ask whether we’ll get back to the long-term score of 6.6, but whether eve that score had serious concerns baked in.

It feels as if it does. When we look at what the public trust charities to do, it turns out they really don’t have that much trust in charities’ abilities to run themselves efficiently and effectively, or to fundraise. They don’t trust charities which make money from investments and government contracts, either.

In short, it feels as if there are three aspects we need to consider. I think all three of the following statements are true:

  • There have been some genuine failings and weaknesses which we need to hold up our hands to.
  • There are some weaknesses in the accountability loops which mean the public don’t feel comfortable that charities are properly scrutinised
  • There are plenty of unrealistic expectations which the sector can never live up to

The tendency has been to choose one of the above as the explanation, and ignore the other two, but all three are very real, very serious issues.

Our feeling would be that the Commission has focused too much on the headline number, and on one explanation for it, and come up with an unhelpful message that everyone needs to do better.

It’s a hard line we’re asking the regulator to take – supportive of legitimate activity, careful to stress the value of charity, but sufficiently robust with wrongdoing. And all on a minuscule budget. But at the moment, it feels as if the Commission has set itself a little too far apart from the community it regulates, and focused too much on one set of problems. And this has created a tendency to take a tone which may not be wholly effective in achieving the goals it desires.

This post was last reviewed on 14 November 2019 at 13:26
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