Another Side to Charity Regulation

In our May blog, I talked about the importance of avoiding problems which would ultimately lead to a Charity Commission investigation.

This proved to be an appropriate subject for discussion in the light of the first speech given on 4 May by Orlando Fraser, the new Chairman of the Commission, after taking up his post.

In recent years the Charity Commission has become more robust in its approach to regulating charities. This is no bad thing: charities are organisations employing many people and receiving enormous sums of money from private, corporate and statutory sources. It is right that they should be regulated and that Trustees and executive staff who abuse the trust placed in them by the public should be brought to book.

But there is another side to charity regulation. An increasing number of small charities are run entirely by volunteers, with the result that a higher proportion of their income is devoted to their beneficiaries rather than salaries and other administrative costs. Many of these volunteers make genuine errors, and it was heartening to note Orlando Fraser’s statement that the Commission would consider genuine mistakes in a different light from deliberate misconduct or mismanagement.

Despite his promises, small charities in particular will continue to face challenges in the post-coronavirus environment and their Trustees will undoubtedly make mistakes in their attempts to secure their charities’ future. But in the dark clouds which gather ahead, Trustees will be glad to know that there is a silver lining in terms of the Charity Commission’s attitude to their problems and their challenges.