BWB Briefing for Charities and Social Enterprise

At a glance

The steering group for the Code of Good Governance is looking for views on whether larger charities need additional guidance or materials.

The Fundraising Standards Board has partly upheld a complaint about Sports For Champions.

This year’s Volunteers’ Week is 1 June to 7 June.

The Department of Energy and Climate Change has published guidance on community ownership models under the feed-in tariffs scheme.

The RSPB has won a Court of Appeal judicial review case relating to a cull of herring gulls in part of the Ribble Estuary.

The High Court has confirmed a recently granted contract for the supply of domestic violence and abuse support services should remain suspended while the incumbent provider, a Bristol not for profit, challenges the award of the contract on procurement grounds.


Governance

The steering group for the Code of Good Governance is looking for views on whether larger charities need additional guidance or materials. Feedback can be submitted here.


Tax and VAT

This Civil Society Media article flags that HMRC has failed to publish guidance on a change of HMRC policy re VAT on direct mailings which came into effect on 1 April. BWB’s Bill Lewis comments “HMRC’s policy seems to be something of a one size fits all approach when the reality should depend on the facts of each arrangement. In terms of introducing this new policy, it is unacceptable that HMRC has not mentioned anything on its website indicating the change of policy or explaining the new arrangements with effect from 1 April." Charities with concerns should contact their tax advisors or Bill Lewis on b.lewis@bwbllp.com. Charity Finance Group has published its correspondence with HMRC on the subject here.


Campaigning

BWB Partner Simon Steeden sets out the do’s and don’ts of campaigning in the lead up to the general election in this FAQ published by the Guardian.


Business rates

CFG has released a policy briefing for charities on business rate relief. The briefing includes a number of recommendations for charities and government to improve the implementation of charitable rate relief including:

  • The need for charities to better demonstrate their value to the local community when applying for rate relief. Creating a dedicated hotline for charities to report business rate relief scams.
  • Improving data collection on business rate relief.
  • Local authorities need to have a holistic view of the role of charities.
  • A full review of the business rate retention scheme’s impact on charities.

Charity Finance Group is working with other charity representatives to respond to the government’s business rate relief discussion paper, and is hosting a survey online for charities to feed in their experiences with the business rates system.


Conflicts of interest

See case under Local authority below.


Local authority

Local Government Lawyer reports a case where a local authority councillor has been convicted of an offence under the Localism Act 2011 of taking part in a decision in relation to which the Councillor had a pecuniary interest. The councillor was a Non-Executive Director of a charitable housing association, and although not paid a salary, he had received remuneration payments totalling £29k from 2010 to 2013. The councillor had disclosed the interest arising from this role in 2012 but the offence was committed when he took part in a decision in 2013 about the Council’s Core Strategy despite links between the decision and the charity, including that the charity had responded to a consultation on the strategy, and the charity owned land that was mentioned in the Core Strategy. The Localism Act imposed a positive duty not to participate in the decision and not to vote (unless he had obtained dispensation, which is possible under the Act).


Animal welfare / conservation

The RSPB has won a Court of Appeal judicial review case, leading to the quashing of a direction of the Secretary of State to Natural England to give consent to British Aerospace Systems (BAe) to cull 552 pairs of lesser black-backed gulls and take measures to maintain the population of herring gulls. BAe had identified the gulls as the main cause of bird strikes (birds being sucked into engines), which endanger the planes tested and manufactured by BAe's operations. The Court of Appeal said that the Secretary of State's decision to direct Natural England to give consent to the cull was flawed because the Secretary of State had:

  • Misinterpreted the conservation objectives for the Special Protection Area (SPA).
  • Wrongly used a generic threshold for natural fluctuation in the bird populations in the SPA to justify deliberately reducing and maintaining the populations to a certain percentage of the level of the population at the time the site was designated as an SPA.

Environment / Energy

On 27 March, the Department of Energy and Climate Change published guidance on community ownership models under the feed-in tariffs (FITs) scheme.


Volunteering

This year’s Volunteers’ Week is 1 June to 7 June. See this NCVO blog for details.


Procurement

The High Court has confirmed a recently granted contract for the supply of domestic violence and abuse support services should remain suspended while the incumbent provider, a Bristol not for profit, challenges the award of the contract on procurement grounds. Among other things, the High Court found that damages would not be an adequate remedy for the claimant, which is a non-profit making organisation and bid for the contract making no allowance for profit. It was accepted that loss of the contract would have a "catastrophic" effect on the claimant's ability to provide other services. By comparison, the disadvantages to the Council of not lifting the suspension were either non-existent or negligible. The delay would not be significant and, most importantly, there was no evidence that such a delay would be damaging to users of the services provided under the contract.


Fundraising

The Fundraising Standards Board (FRSB) has partly upheld a complaint about Sports For Champions (SFC). The FRSB ruled that:

  • SFC did not make it clear how monies would be allocated when fundraising in partnership with a school.
  • But the company’s fundraising model – which saw children competing with their peers for sponsorship from the public in return for incentives – was not ‘unethical’ and did not potentially put children’s welfare at risk.

During the adjudication, the FRSB consulted the Institute of Fundraising’s “Fundraising in Schools” guidance and has recommended that the Institute of Fundraising reviews the Fundraising in Schools guidance to assess whether any elements should be reallocated into the main body of the Code.


Scotland

Following media articles on the issue, OSCR has issued a statement setting out its expectations as regulator in relation to the salaries of senior staff in charities, and charity ‘running costs’. The statement makes clear there is no one standard to apply to all charities other than expecting the charity trustees to show that they are making decisions on expenditure and salaries properly. In relation to salaries, this means considering what level of reward is necessary to attract and keep the people that a particular charity needs. And in relation to running costs, OSCR makes the point that the charity sector is very diverse and some charities, by the nature of their services, will cost more to run than others.


Australia

Civil Society Media reports Australia’s coalition government has withdrawn from plans to abolish the country’s newly-formed charity watchdog, following calls by sector members for it to remain. The Australian Charities and Not-for-profits Commission (ACNC) was launched in December 2012 to register and regulate charities, but was due to be scrapped as part of a “red tape repeal day”.


Posted on 22/04/2015 in Legal Updates

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