The Bill is now waiting for Royal Assent and once it is made law, which should be early in 2013, it will allow the trustees of charities with permanent endowments to treat the capital appreciation on those assets in the same way as income, without having to obtain the approval of the Charity Commission.
The changes will give trustees much greater flexibility in their management of funds and will allow trustees to focus on overall return rather than being concerned about the balance between capital growth and income generation.
Once the Bill becomes law the Commission plans to consult charities on the rules for investment which charities will still have to abide by. The changes will affect almost 14,000 charitable trusts.
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