Charity Finance Group responds to Public Accounts Committee reports

5th February 2014

In response to the PAC report on the Charity Commission, Caron Bradshaw, Chief Executive of Charity Finance Group, said:

"The Public Accounts Committee report on the Charity Commission is a damning indictment of the sector’s regulator. But while there are certainly areas of the Commission’s work that need urgent improvement, such as how it registers and investigates charities, it’s too easy to make sweeping criticisms and declare wholesale failure. Worryingly, this approach may create a damaging impression of how well charities are run in the public mind and ultimately push the Commission in an unhelpful direction.

Yes, there have been failings, instances of unchecked abuse and oversights; these must be addressed, but the Commission has also achieved a lot in helping charities to professionalise and comply with their duties. The impression created by the report is that the sector could be awash with rogue charities and cases of mismanagement. Such impressions are particularly unhelpful at a time when charities are facing sustained and often unwarranted criticism. By and large, charities operate to high standards, demonstrating trustworthiness and probity.

While we welcome regular scrutiny of the regulator, we are concerned that the requirement to report back to the Public Accounts Committee in a years time will result in a knee-jerk reaction by the Commission’s leadership. The new board have already taken steps introduced in a range of new measures to tackle many of the points highlighted by the NAO. It should continue on this route but also engage with the sector at this critical juncture. It is also vital that it both makes full use of the powers that it has and seeks additional resources as necessary."

In response to the PAC report on Gift Aid and other donations, Jane Tully, Deputy Director of Policy and Engagement at CFG, said:

"We are pleased that the Public Accounts Committee has drawn attention to the lack of evidence and data surrounding Gift Aid. In the sector we are acutely aware of the importance and success of the scheme; we want to work with HMRC to increase knowledge further and to be in a better position to make evidenced-based policy changes.

The poor understanding of corporate Gift Aid, and the impact that the changes in 2000 have had on the overall figures, has been highlighted. We welcome recognition that information is not being shared within HMRC with relevance to this – something we think should be addressed.

In recent years we have consistently called for better collaborative working between HMRC and the Charity Commission. We are finally seeing real steps being taken by these organisations to improve the way they work together. We hope that plans being put in place are implemented effectively to invoke real change.

There is a need to simplify Gift Aid by enhancing use for charities and donors to improve effectiveness of the scheme. This has been recognised by HMRC. It is interesting that the PAC has made the link between the need for simplification and the aim of reducing abuse or misuse of Gift Aid, a sentiment we would echo. All too often schemes and initiatives which are intended to simplify Gift Aid seem to add further complications to the overall framework and make it more difficult for charities to navigate. This is largely due to anti-fraud measures, which while understandable, often add layers of complexity blocking charities’ access. The Gift Aid Small Donations Scheme is a primary example of this; we hope that imminent changes intended to support digital giving do not go down the same path. "

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Notes to editors:

  1. Charity Finance Group’s vision is to inspire the development of a financially confident, dynamic and trustworthy charity sector. CFG works with finance managers to enable them to give the essential leadership on finance strategy and management that their charities need; promoting best practice in charity finance, driving up standards, campaigning for a better operating environment and ensuring every pound given to charity works harder. CFG has more than 2,200 members, and collectively our members are responsible for the management of over £19bn in charitable funds.
  2. The Public Accounts Committee reports on the Charity Commission and Gift Aid can be found here.
  3. For more information please contact Jane Tully, Director of Policy and Engagement on jane.tully@cfg.org.uk or on 020 7871 5474
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