An interesting piece was published yesterday on the Civil Society website under the heading "Too much regulation is strangling charities, warn law firms".
There is clearly a significant amount of regulation that applies to charities. The extent to which this regulation "strangles" our clients varies. Many of the smaller charities we act for do not necessarily notice the regulatory framework within which they operate whereas some of the larger charities (charitable providers of social housing spring to mind) do tend to carry out work that presents questions around charitable status, trading rules, tax and many other regulated areas.
However, there are some other interesting features in this article.
Firstly, the comments concerning the lack of resource at the Commission certainly ring true. We are experiencing the longest delays I have ever experienced in dealing with the Commission (I have been qualified just over 8 years). Registration applications can take 4 to 5 months to be considered by the Commission and straightforward consents and orders are meeting with not dissimilar delays. This is a frustrating issue for myself and clients although it is one that can be understood in the context of the Commission's funding cuts since the start of the decade.
The second interesting feature is the Commission's comments on serious incident reporting. Serious incident reports are on the rise following the issues reported in the press earlier this year concerning the aid sector. We have been advising clients to adopt a more cautious approach to reporting in the current climate and we have seen more clients report serious incidents than ever before.
The Commission has expressed concern that there is still "significant underreporting" of serious incidents. This may the case however we have seen the Commission ask a client to justify a serious incident report in a manner that almost suggested that the report was unnecessary. I found this strange at the time, and even more so now in light of the Commission's comments on underreporting.
The Commission considers its guidance on serious incident reporting to clear and whilst the process of reporting is very clear, I do think the guidance could go further in assisting charities determine what is and is not a serious incident.
The third interesting feature is the Commission's response to apparent criticism from the legal profession. The Commission has not been shy in expressing its disagreement and this might serve as further evidence of the more regulator-like approach that the Commission is taking. William Shawcross, the Commission's previous Chair talked about the Commission being the charity sector's policeman rather than its friend and this approach seems set to continue under Baroness Stowell.
The Commission's new strategy was announced last week (see: https://www.gov.uk/government/publications/charity-commission-strategy-2018-2023). We will report on this separately but it seems that there are interesting times ahead for charity regulation.
"Most charities understand what are existing legal duties and welcome clarification from us as regulator as to how these play out in the context of keeping people safe." She said the Commission continues to be concerned about significant underreporting of incidents by charities, as only 1.5 per cent of charities have reported a serious safeguarding incident to the regulator.