Late last week I found myself on the train engaged in a series of tweets concerning reports that charities had been gagged by the DWP in contracts relating to the roll out of Universal Credit.
Charities subject to such clauses were described as "cowardly" whereas others suggested that charities agreeing to preclude themselves from speaking out against policy that may be detrimental to their beneficiaries are in the wrong.
A closer inspection of the clause in question does make for interesting reading.
The Times reports that the clauses state that charities must “pay the utmost regard to the standing and reputation” (good or bad?) of the work and pensions secretary and that they must “not do anything which may attract adverse publicity” to her, damage her reputation or harm the public’s confidence in her.
Does this prevent a charity from speaking out against Universal Credit?
Charities subject to these provisions have come out and stated that they are not prevented from speaking out on the policy as a result of this clause and the DWP has provided similar assurances to the Charity Commission.
Perhaps a better description of these clauses would be to describe them as "non-disparagement" clauses, as opposed to gagging clauses. It must be possible for charities who hold these contracts to speak out on the effect of Universal Credit on their beneficiaries without attracting adverse publicity to Esther McVey whilst also paying the utmost respect to her standing and reputation?
Charities subject to these clauses will undoubtedly have to tread carefully when entering into the debate on Universal Credit and there is a lot of subjectivity in the reported wording of the clause that could result in disagreement and dispute but are they completely prevented from speaking out as a result of this clause?
I would however query whether charities should be criticised for entering into contracts, even where true gagging clauses exist? Charities are permitted to speak out in pursuit of their objects. Putting to one side the clear case law, the Charity Commission’s own guidance states that “campaigning and political activity can be legitimate and valuable activities for charities” and that “charities can campaign for a change in the law, policy or decisions where [it supports] the charity’s purposes”.
However, it is for charity trustees to decide how they pursue their objects and is a decision to deliver a service better or worse than choosing instead to speak out against the policy behind the service?
In an ideal world a charity might do both. However, a charity might not consider itself equipped to engage in political or campaigning activity or its trustees might consider it a more impactful use of its resources to actually deliver the services. The new Universal Credit regime has been the subject of significant criticism from the charity sector since its inception, contributing to the further delays announced this week. Whilst the charities identified in the Times report may not truly be gagged, is there any real impact of a handful of charities choosing to keep out of the debate as a means of reaching beneficiaries on the ground?
Charities must maintain their independence. But charities can also independently decide to pursue one course of action at the expense of another if they are satisfied that it is the best interests of their beneficiaries to do so.
The issue of “gagging” clauses is particularly sensitive for charities as the government previously tried to introduce an “anti-advocacy” clause into its standard grants contracts, which would have made it difficult for charities to speak out. But the clause was watered down after lobbying from the sector and others.