Charity Finance Group responds to PASC's post-legislative scrutiny report into the Charities Act

6th June 2013

In response to the publication of the PASC report ‘The Role of the Charity Commission and “public benefit”: Post legislative scrutiny of the Charities Act 2006’, Caron Bradshaw, CEO, CFG, commented: 

“Ensuring that the sector is proportionately regulated is essential, both for preserving public trust and confidence and enabling innovation and growth.  We therefore welcome the efforts of the Public Administration Select Committee in scrutinising the legislative framework to ensure it is fit for purpose; and their report, like Lord Hodgson’s before it, has been bold in exploring some of the long-standing and controversial issues regarding charity regulation. 

“We were particularly pleased that the Committee opposes introduces a charging system to register new charities or submit accounts.  In our view, charging would be complex to implement, remove funds from the sector and unfairly impact on the smallest charities.  We also strongly welcome the call to make single returns to the Charity Commission and Companies House a priority.

“In the absence of an absolute consensus on many of these issues it is positive that that there has been a high level of scrutiny along with on-going engagement with the sector.  However, these lengthy reviews need to result in action and it is how the Government chooses to take forward the recommendations made in this report and by Lord Hodgson which will be of real importance.  CFG is looking forward to working with Government, the Charity Commission and our sector partners as the next steps are determined.”

CFG’s position on some of the key issues addressed in the report is as follows:


CFG is pleased that the Committee is against the recommendation to introduce a charging system for the registration of new charities or the submission of annual returns.  Given the public duty nature of its work the Charity Commission should remain funded by Government charging would place a significant burden on small charities and act as a deterrent to engaging with the regulator.  As the report highlights, it would also be complex to implement and detract resources from key services at a time when they are already scarce.

The report advocates a proportionate and flexible system of fines for late submissions to the Commission.  CFG accepts, in line with the report, that there could be a case for imposing charges on late filers as a compliance measure.  However, this needs further detailed consideration on the complex reasons as to why accounts are not submitted on time; and whether the implementation of a system of fines would actually drive higher compliance or if there are more effective means of achieving a similar outcome.


CFG is pleased that the report reiterates Lord Hodgson’s recommendation that charitable companies should not be required to file annual returns with both the Charity Commission and Companies House, and suggests that this should be addressed as a priority.  CFG has long called for a single reporting system which would hugely reduce administrative burdens on charities.

In line with the report, CFG strongly opposes increasing the threshold for compulsory registration to £25,000 as was recommended by Lord Hodgson, and supports its maintenance at £5,000 (or a figure close to this). Many smaller organisations place a very high value on Charity Commission registration as it gives then legitimacy in the eyes of funders, and registration increases familiarity with regulatory obligations.  Registration should be encouraged and organisations with an income below £5,000 that wish to register with the Commission should be able to do so more easily.

Public benefit:

The concept of public benefit and public benefit reporting is and important aspect of charity law and regulation.  CFG would like further clarity and improvements to be made to the reporting requirements and the reasoning behind public benefit reporting.  The Government should consider the position of exempt and excepted charities in relation to the public benefit reporting requirements and how regulation can be streamlined across these charities.

- Ends -

Notes to editors:

1. Charity Finance Group is the charity that champions best practice in finance management in the voluntary sector.  Our training and development programmes enable finance managers to give the essential leadership on finance strategy and management that their charities need.  With more than 2000 members, managing over £19bn, we are uniquely placed to challenge regulation which threatens the effective use of charity funds. For more information, please see

2. CFG’s written evidence for this inquiry can be read here, and the CFG submission to Lord Hodgson’s review of the Charities Act can be read here.

3. For further information, please contact Melora Jezierska, policy and public affairs officer, at or on 020 7250 8348.

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