Charity Fundraising under Fire

Whilst all media attention focused on the new Labour leader’s oratorical and sartorial performance at Prime Ministers Questions last week, an important debate about charity fundraising regulation was taking place in the Upper House.

“Self-regulatory system has failed”

The 3rd reading of the Charity (Finance and Social Investment) Bill sparked a heated debate in the House of Lords about future regulation of charity fundraising. The bill, which extends the powers of the Charities Commission to prevent charities abusing their charitable status, was introduced after a summer of scrutiny of aggressive fundraising practices. Lords called for “tighter and more visible regulation” to restore public confidence in charity.

What solution?

Some peers called for the FRSB, the independent regulator which holds charities in England and Wales accountable for their fundraising, to be replaced altogether. The FRSB’s inability to deliver standards set by Parliament and the public is partly due to lack of personnel (only 6 people work for FRSB) and the complexity of the current system.

However, the proposal to extend the regulatory powers of the Charities Commission was contested due to the Commission’s current hostility towards charities.

Message to trustees: your ultimate responsibility

The FRSB appointed a new chair on the same day as Mr Corbyn’s Commons debut. A former chief executive of the Charities Commission, Andrew Hind will understand the importance of collaboration between both regulators. His first public statement reiterated that charity trustees are ultimately responsible for ensuring funds are applied for charitable purposes and that their fundraising practices are within an ethical framework.

If you have any fundraising concerns or general queries, contact Neil Burton or your usual Mills & Reeve advisor.

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