Our weekly round up of news and updates from across the sector

Charities Act 2022

Restitution cases / national museums and galleries

As reported in third sector press, the government has written to the Charity Commission and announced its plans to make exclusions from the Charities Act 2022 so that overseas transfers of property are excluded from ss15 and 16 of the Act when they come into force later this year. Bates Wells partner Erica Crump, who regularly advises on restitution cases, explains, "This means overseas transfers of property will always require Charity Commission consent, regardless of the value of the property. The government intends to also exclude national museums and galleries from the provisions, meaning their trustees would not be able to make applications to the Charity Commission or Attorney General to make ex gratia disposals of property where they consider themselves to be under a moral obligation. The government is yet to publish how it intends to make these exclusions."

Charity Commission

New inquiry

The Commission has announced that it has opened an inquiry into 'Trust Property Held In Connection With The London Spiritual Mission', a charity that supports the London Spiritual Mission, due to disputing trustees who it says have been unwilling or unable to work together to address regulatory concerns. These concerns include poor financial management and compliance with accounting and reporting requirements.

Charity investment

On Thursday this week Charity Investors Group is hosting a session on the role of alternative investments in charity portfolios. Bates Wells' Barbara Eze is on the committee of CIG and comments, "This session promises to be very insightful. I'd encourage any charity exploring alternative investments or reviewing their investment portfolios more generally to come along."

Governance

In order to assist in board performance reviews, the Chartered Governance Institute (CGI) has published a Code of Practice for board reviewers: Not-for-profit organisations and Principles of Good Practice for not-for-profit organisations undergoing reviews. There's also an accompanying blog here.

The CGI also has a new model set of Terms of Reference for the Sustainability or ESG Committee, which can be accessed as a registered free subscriber.

Tax and VAT

Gift aid

The Civil Society Group, a collection of nearly 90 charity umbrella bodies, has written a letter warning the government that charities could lose hundreds of millions of pounds in Gift Aid if the basic rate of income tax is reduced in the March Spring Budget. They have made several suggestions to help preserve voluntary sector income, including an automatic transitional relief mechanism, financial incentives for legacy donations and a new VAT rate on charity purchases.

Charity Tax Group (CTG) has flagged in its newsletter that the Scottish Government recently announced tax bands and rates that will apply to Scottish taxpayers for 2024/25, including a new 'Advanced rate' band of 45% on income between £75,000 to £125,140. Regardless of where a donor pays tax within the UK, the amount of Gift Aid that the charity reclaims is always at the 'UK' basic rate of 20%. CTG flags that there are impacts on the donors themselves and for those paying at higher rates of tax, this may impact on fundraising conversations and communications.

Charity trading

Although it may seem counter-intuitive, it is often not in the interests of a charity's trading subsidiary to claim 100% tax allowances for capital expenditure in year one. See this article on Charity Tax Group's website.

The Employment (Allocation of Tips) Act 2023, is expected to come into force 1 July 2024. The Act will create a legal obligation on employers to allocate all tips, gratuities and service charges to workers – without any deductions – and to ensure that they are distributed fairly between workers. The Government has published a Draft code of practice on fair and transparent distribution of tips designed to help employers and workers understand the new law. Further non-statutory guidance will be published in due course to accompany the Code of Practice to help interpret the legislation. The Act applies to all sectors where tips are paid. While this may have limited application in the charity sector, it will apply to, for example, cafeterias attached to charity premises.

Sector general

The latest round of the Nottingham Trent University and Pro Bono Economics' quarterly VCSE Barometer Survey closes on 7 February. This quarter's special focus is on the impacts of operating within the current local authority landscape.

The Security Industry Authority has announced the opening of its grants for good causes fund for 2023 to 2024. The money is received through proceeds of crime confiscation orders. The grants are open to registered charities and community interest companies who will use it to support one or more of:

  • People working, or intending to work, in the UK private security industry.
  • The UK private security industry as a whole.
  • Public protection in the UK (for example, by preventing terrorism and crime, or protecting vulnerable people and communities).

Climate change and environment

Stage 1 of the Government's Forest for the Nation competition has opened for applications and closes on 18 March 2024. There will be one overall winner who will receive up to £10 million to fund their project.

The government has announced new measures to boost nature recovery, as part of its Environmental Improvement Plan. The measures include closure of sandeel fisheries which have impacted on food supply for seabirds and marine mammals, funding for lowland agricultural peat projects and a new Protect Landscapes Outcomes Framework, setting non-statutory targets for England's Protected Landscapes (National Parks and National Landscapes).

Safeguarding

See below under Housing and homelessness.

The Child Safeguarding Practice Review Panel, which reviews local safeguarding incidents when a child dies or suffers serious harm and abuse, has published its fourth annual report (press release). Key findings include:

  • Over half of reviews featured a child who had experienced neglect.
  • 11% of school-age children who died or were seriously harmed were not in school, and 29% were regularly absent.
  • In over 75% of cases, the family of the child was known to social care authorities.
  • 25% of children were on, or had been on, a child protection plan.

Fundraising

Fundraising Regulator

At a recent Westminster Policy Forum conference we were interested to hear from Gerald Oppenheimer about the current work of the Fundraising Regulator (FR) and what's on the horizon:

  • Consultation on Code of Fundraising Practice – this closed 1 December 2023. The FR is analysing approximately 4,500 responses and preparing a new draft code for summer 2024. There will be engagement with the sector and the public in June/July 2024 with the final version published early 2025.
  • Market inquiry into sub-contractors – the FR is considering feedback from the workshops it ran last year and will put together a programme of advice and support for charities and agencies which it will share early 2024. Alongside, the market inquiry, the FR has a parallel set of investigations around complaints that came in about a number of charities and the sub-contractor methods they were using.
  • Levy review – there has been a review of the levy charged to organisations by the FR (and you can submit your comments on the levy proposals until 9 February). The new levy will be confirmed in April and is set to launch in September 2024.
  • The FR is conducting public research into public attitudes towards different fundraising practices. It will share outcomes from public research conducted by Opinium – surveying approximately 3,000 people on their opinions on charities and specific methods of fundraising.

Data protection

The Information Commissioner's Office (ICO) is running a campaign warning organisations that they risk facing enforcement action if they do not make advertising cookies compliant with data protection law. The ICO started last November, writing to the UK's top 100 websites, and has had a positive response. It will continue to write to the next websites on the list and is also developing an AI solution to help identify websites using non-compliant cookie banners.

The ICO has a new campaign, partnering with education, law enforcement and social service organisations to raise awareness about responsible data sharing to safeguard children. This includes a toolkit of free resources to promote responsible data sharing and follows a 10-step practical guide, launched last September which outlines how organisations can safely and lawfully share information to safeguard children.

AI

A new report from the Charities Aid Foundation shows that the public has mixed views on charities using AI. Some key takeaways from the report are:

  • 37% said the opportunities outweighed the risks.
  • 22% said the risks exceeded outweighed the opportunities.
  • The more generous donors are the most in favour of AI.
  • High-income countries are more sceptical.
  • Chief concerns were charity workers losing their jobs, and data breaches.

Talking about AI and the charitable sector: what, if anything, should charities and non-profits do to keep pace? Listen to this podcast where Dr Clare Mills, Director of Policy and Communications at Charity Finance Group talks to two social sector experts – Zoe Amar from Zoe Amar Digital, and Rhodri Davies from Why Philanthropy Matters.

Company law

Company Names Tribunal

Sanctuary Housing Association, an exempt charity, applied for a change of name of the company 'Health Care Sanctuary Limited'. The application was undefended and an order given for the company to change its name and a payment of costs to the charity.

Housing and homelessness

The Department of Health and Social Care and the Department for Levelling Up, Housing and Communities have jointly published new guidance, Discharging people at risk of or experiencing homelessness, which applies in England. It is aimed at staff in care transfer hubs and others involved in planning the discharge of patients.

The Department for Levelling Up, Housing and Communities has issued a consultation on reforms to social housing allocations in England, which are made under Part VI of the Housing Act 1996 (HA 1996). Measures could include evictions for those with anti-social behaviour and prioritising households who have a close connection to the UK and their local area. The consultation closes on 26 March 2024.

The Welsh Government has published its Ending Homelessness Outcomes Framework, setting out the outcomes it hopes to achieve in order to prevent and end homelessness in Wales.

The Secretary of State for Levelling up, Housing and Communities, Michael Gove, has written to Wandle Housing Association, Sovereign Housing Association and A2 Dominion Housing Group Ltd, each a charitable registered society, after they received findings of severe maladministration from the Housing Ombudsman last year. The findings related to poor living conditions, including damp, mould, pest infestations and the housing associations' unsatisfactory response to repairing these conditions. The letters from the Minister expresses that he will be taking a "personal interest" in the changes needed to improve services.

Health and social care

See above under Housing and homelessness.

The Healthcare Services Safety Investigations Body has published its terms of reference for its investigation into mental health settings. The aims of the investigation include helping to provide safe care during transition from children and young people to adults in mental health services. The investigation is set to conclude by the end of 2024.

Social enterprise

A coalition of business networks is campaigning for EU policymakers to better support the social economy and the shift towards sustainable business. The Business for a Better Tomorrow coalition, which includes members such as B Lab Europe, is launching a manifesto that will outline proposals to develop regulations and laws that are favourable towards social enterprises. Among others, the coalition wants to influence the EU's Green Deal, Social Economy Action Plan and corporate sustainability reporting and due diligence directive. See this Pioneers Post article for commentary.

Social investment/social impact investment

Big Society Capital (BSC) CEO Stephen Muers comments on Shadow Chancellor Rachel Reeve's speech at the Labour Business Conference during which Labour's Financing Growth plan was mentioned. BSC calls on Labour to support specific actions to further the social impact investment space.

CFA UK has introduced a Certificate in Impact Investing for investment professionals, which aims to teach fundamental skills around incorporating impact into investment practises. The CFA Institute is an industry body that aims to lead the investment profession globally by promoting the highest standards of ethics, education, and professional excellence for the ultimate benefit of society. Its work includes creating industry codes and standards.

Culture + Creative

The fourth round of the Cultural Development Fund has launched, with £15 million being made available to cultural venues to apply for. The details can be found on the Arts Council's website, which delivers the fund on behalf of the Department for Culture, Media and Sport.

International development

Bond has commented on the government's approach to disability-inclusive development, following Andrew Mitchell (the Foreign and Commonwealth Development Office Minister) giving evidence to the International Development Committee. Bond is encouraged by some of the commitments from the Minister, such as publishing the Delivery Plan that accompanies the Disability Inclusion and Rights Strategy, which would allow clear targets to be set which match the ambition of the strategy. On the less encouraging side is the fact that only around a third of the UK's bilateral Official Development Assistance is disability-inclusive and less than 1% is targeted towards people with disabilities.

Education

General

The Welsh government has published a Peer-on-peer sexual harassment in education settings: action plan which aims to tackle sexual harassment between peers in primary and secondary education settings, and further education institutions. Key actions proposed include:

  • Updating the Relationships and Sexuality Education code and anti-bullying guidance to support students in identifying appropriate behaviour and learning about safe, equal and healthy relationships.
  • Reviewing the government's current guidance, Peer sexual abuse, exploitation and harmful sexual behaviour.
  • Providing training and guidance to schools to help teachers feel confident speaking and teaching about sexual harassment.
  • Addressing online sexual harassment.

Ofsted and the Care Quality Commission have published a report on how education, health and care partners work together on 'alternative provision' (AP) – where pupils have been excluded or cannot attend mainstream school. Alternative provision in local areas in England: a thematic review finds that the lack of national standards and clarity around who is responsible for AP is leading to inconsistent outcomes for children. It highlights examples of good practice on this, and makes recommendations to improve the approach to AP including better guidance, more clearly defined roles and responsibilities for providers and greater consistency in individual AP placements.

The Department for Education has opened a consultation on the draft statutory guidance for local authorities on the use of agency child and family social workers.

Schools

The Department for Education has launched a major national childcare recruitment campaign to help nurseries and early years providers recruit the workers they need and create more childcare places for parents. The Do Something Big campaign will trial a £1,000 sign-on bonus for childcare workers as an incentive and aim to highlight the positive progression opportunities and diversity of career routes within the childcare sector, while emphasising the chance to shape the lives of children.

The Department for Education has also announced a new 'initial teacher training and early career framework' which aims to ensure high quality teaching and better pupil outcomes. The framework will ensure all teachers receive a minimum of three years of training, and will be rolled out from September 2025. The government will also be offering a new teacher degree apprenticeship as an alternative route to qualification as a teacher, whereby trainees will study alongside working.

The Education Select Committee has published its findings on improving Ofsted's work with schools, concluding that major changes must be made to school inspections. Areas such as the use of single-word judgements, the impact of judgements after an inspection and the inspection of multi-academy trusts were assessed. See here for commentary from the National Governance Association.

An Ofsted press release shows it has sent its annual 'point-in-time' surveys to social care providers, including residential special schools, further education colleges with residential provision and children's homes, to gain a clearer picture of the experiences of the children, parents, staff and professionals involved. See here for a blog post explaining how Ofsted uses the responses.

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