BWB Highlights

Charities and companies considering campaigning in relation to the EU referendum should see guidance published by the Electoral Commission and the government last week – more details in today’s Briefing.


At a glance

The European Parliament has formally approved the EU's general data protection reform package, which includes the General Data Protection Regulation (GDPR).

The European Commission has issued a public consultation on the Privacy and Electronic Communications Directive (2002/58/EC as amended).

The government has announced Baroness Tanni Grey-Thompson is to lead an independent review of “safety and welfare in sport”.

The High Court has held that the Peabody Trust's decision to refuse a request to exchange a tenancy was not amenable to judicial review.


Charity Commission

The Charity Commission and governance issues

Civil Society Media reports Sir Stuart Etherington, chief executive of NCVO, has written to minister for civil society Rob Wilson, expressing “serious concerns” about the Charity Commission’s governance, and asking him to address the issue “as a matter of urgency”. Sir Stuart has questioned in particular whether the process of appointing board members is appropriate and whether the board has become too involved in executive decision-making.  

Monitoring reports

The Commission has published the following reports under its Accounts Monitoring function, whereby a sample of charity accounts are checked for compliance with SORP and to identify issues of regulatory concern:

  • Public Benefit reporting by charities 2016 - This review looked at the quality of public benefit reporting and the Commission found that, although there had been improvements in some elements, the level of full compliance with the requirement to report on public benefit remains far below what the Commission wishes to see.
  • The quality of charity accounts 2016 - This review looked at the percentage of charity accounts monitored found to be of acceptable quality for charities with annual incomes over £25,000. The Commission found that 77% of the accounts reviewed this year were of acceptable quality and has inferred from this that the quality of accounts is improving as this figure has been increasing year on year.
  • The quality of small charity accounts - This review considers the quality of accounts filed by charities with an income of less than £25,000. Only 47% met a set of basic criteria and so were of acceptable quality – the same figure as last year. The Commission also published a press release in relation to this report.

Fraud Policy papers

The Commission has published a collection of documents in relation to fraud in the sector on this webpage.

It has published three new policy papers about fraud, which are all terms of reference relating to the Charity Sector Counter Fraud Group (CSCFG):

Inquiry report

The Commission has published the latest in the series of case reports in relation to the class inquiry into “double defaulter” charities, this time into Rossington Miners’ Welfare Scheme (523813): As a result of the inquiry, the charity has now provided its missing annual accounting information.

CC News

The Commission has published its latest edition of  CC News. This edition includes the following articles:

  • Trustees: do you know the questions you need to ask?
  • Have you read our reserves guidance yet?
  • The new online registration service is here
  • Guidance update for managing financial difficulties
  • Funding non-charitable organisations: new draft guidance
  • Guidance update for Gift Aid: charities and their trading subsidiaries
  • Charities (Protection and Social Investment) Act
  • A new guide to the chair-chief executive relationship

Conversion of charitable companies to Charitable Incorporated Organisations (CIOs)

You may have seen the Cabinet Office is currently consulting on draft regulations to implement a mechanism in the Charities Act 2011 for charitable companies to convert to CIOs.  One of the consultation questions is whether there is a demand for a conversion mechanism of this kind.  We would be very interested to hear client views on this, which we can use to inform our response to the consultation.  Please email any comments to Christine Rigby (c.rigby@bwbllp.com).  

Also see under Social Enterprise below for a similar question in relation to conversion of community interest companies to CIOs.


General 

ACEVO has announced it has partnered with ITN Productions  to create a “unique news and current affairs style programme which will showcase the important work done by charity leaders, while also looking to the future of the sector”.  ‘Leading with Heart & Head’ will premiere at ACEVO’s annual conference on 17th November in West London.


Data protection

Civil Society Media reports the Information Commissioner’s Office has cleared four charities being monitored over compliance issues of any wrong doing.   They include Christian Aid, RNIB and Greenpeace.  

The European Parliament has formally approved the EU's general data protection reform package, which includes the General Data Protection Regulation (GDPR).  The text of the GDPR and other measures included in the package will now be translated into the EU's official languages, which could take up to three months. The GDPR will come into force on the 20th day following its publication in OJ. Organisations will then have two years within which to comply with the GDPR (possibly by summer 2018).  Amongst other new measures, the introduction of a potential sanction of up to 4% of global turnover for breaches of data protection law is likely to have a significant effect on how seriously data protection compliance is taken by businesses in the future.  

The European Commission has issued a public consultation on the Privacy and Electronic Communications Directive (2002/58/EC as amended).  Several policy issues have already emerged as potentially needing to be addressed. These include ensuring consistency of the e-privacy rules with the General Data Protection Regulation. The consultation closes on 5 July 2016. The Commission will use the feedback to prepare a new legislative proposal on e-privacy, which is expected by the end of 2016.


Campaigning/EU referendum

The Electoral Commission has published guidance for charities on the EU referendum spending rules.

Last week, the government published a guide for companies on campaigning in the EU referendum period.


Commissioning

A social enterprise, The Public Service Transformation Academy, has been awarded the contract to run the Cabinet Office Commissioning Academy.


Social finance

New Chief Executive at the Financial Conduct Authority (FCA)

On 13 April 2016, the FCA published a press release announcing that its acting Chief Executive, Tracey McDermott, will leave the regulator on 1 July 2016. Andrew Bailey's appointment as FCA Chief Executive was announced in January 2016 (see Legal update, Andrew Bailey appointed as FCA chief executive designate). Mr Bailey will take up the position on 1 July 2016. Please see the press release here.

CMA addendum to provisional findings in retail banking market investigation

On 15 April 2016, the Competition and Markets Authority (CMA) published an addendum to its provisional findings in the retail banking market investigation. The CMA'S provisional findings, published on 22 October 2015, provisionally found, that there are combination of features of the markets for personal current accounts (PCAs), business current accounts (BCAs) and SME lending (in each of Great Britain and Northern Ireland) that give rise to adverse effects on competition (AEC). These features relate to low levels of customer engagement, barriers to accessing and assessing information, barriers to switching and incumbency advantages, and linkages between PCAs, BCAs and SME lending products. See the PLC notefor further information.

FCA consultation – CP16/11 – PSR regulatory fees 2016/17

In December 2015, the Payment Systems Regulator (PSR) consulted on its proposed approach for allocating, calculating and collecting the PSR’s Annual Funding Requirement (AFR) for 2016/17.  This document sets out the policy decisions on the allocation, calculation, and collection of PSR fees for 2016/17, and further proposals for consultation.  The PSR is seeking feedback by 5pm Friday 13 May 2016.

Also see item under Data Protection above about the GDPR. 


Social investment

An All Party Parliamentary Group on Charities and Volunteering met last week to talk about social investment. See this Civil Society Media report of the discussions.  

New Philanthropy Capital has published a report on the potential for social investment to finance the environmental NGO sector in Northern Ireland.  

Big Society Capital has published this blog about  South Bristol Sports Centre on the launch of its £1million sports scheme, £250k of which was raised using Social Investment Tax Relief.  


Social enterprise

This week will see the launch of the Buy Social Corporate Challenge, an initiative to encourage big businesses to procure goods and services from the UK’s social enterprise sector.   

Conversion of Community Interest Companies (CICs) to Charitable Incorporated Organisations (CIOs)

You may have seen the Cabinet Office is currently consulting on draft regulations which would provide a mechanism for CICs to convert to CIOs.  One of the consultation questions is whether there is a demand for a conversion mechanism of this kind.  We would be very interested to hear client views on this, which we will use to inform our response to the consultation.  Please email any comments to Oliver Hunt (o.hunt@bwbllp.com).

Also see above for a similar question in relation to conversion of charitable companies to CIOs.


Goddard Inquiry blog

BWB have published their most recent blog on the Goddard Inquiry, which outlines the need-to-know points from the preliminary public hearings.


Education

See this Department of Education press release about higher standards in sponsored academies.


Housing

See item under Publis bodies below.


Sport

The government has announced Baroness Tanni Grey-Thompson is to lead an independent review of “safety and welfare in sport”. The Sport and Recreation Alliance describes it as a review of the “duty of care” in sport.  

Also see item under Social investment above.


Environment

See item under Social investment above. 


Public bodies

The High Court has held that the Peabody Trust's decision to refuse a request to exchange a tenancy was not amenable to judicial review. The reason being that in these circumstances Peabody Trust  had not been acting as a public body.


Northern Ireland

Updated online application form

CCNI had originally anticipated that the new version of the form would go live towards the end of April but it is now estimated that the changeover will take place in late May/early June 2016.

Also see item under Social investment above.


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Disclaimer - The information contained in this update is not intended to be a comprehensive update - it is our selection of the website announcements made in the week up to last Friday which we think will be of interest to charities and social enterprises. The content is necessarily of a general nature - specific advice should always be sought for specific situations.


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Christine Rigby

Senior Consultant

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+44(0)20 7551 7712

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c.rigby@bwbllp.com
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Posted on 19/04/2016 in Legal Updates

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