Bates Wells Briefing for Charities & Social Enterprises | 14 January

Bates Wells highlights

Social Enterprise

The Information Commissioner’s Office has begun a consultation on a new ICO code of practice for direct marketing. 

In the final instalment of three video interviews with Thomson Reuters, Mindy Jhittay considers the issues that arise if an employee or volunteer refuses to comply with a charity’s transgender inclusion policies because of their gender-critical beliefs. Her video provides concise, informative guidance on whether there is protection for gender critical beliefs under the law, and how far a person can rely on their beliefs to avoid complying with a charity’s policies. You can access it here.

At a glance

The full judgment has been published in the contempt of court case brought by the Charity Commission against two former trustees. 

In Northern Ireland, the Department for Communities is seeking views on the regulation of gambling in Northern Ireland.  

Charity Commission

New inquiry

The commission has announced that it has opened an inquiry into the Sikh Channel Community Broadcasting Company Limited (1136163). This is due to regulatory concerns resulting from a meeting with the charity’s trustees which relate to the charity’s governance, including conflicts of interest, and concerns over the charity’s financial management. Since the opening of the inquiry new trustees and a new CEO have been appointed to the charity.

Inquiry report

Name of organisation

Jole Rider Friends

Inquiry report

CC press release

Brief description

The original engagement between the Charity Commission and the charity in 2015 was a pro-active enquiry by the commission as a result of the charity having only two trustees.

The resulting statutory inquiry found that the two founding trustees had received unauthorised remuneration of £322,500, equating to 23% of all income received by the charity since it began.

It also found that it was unclear whether the charity was acting for the public benefit and that the charity was insolvent as a result of rent arrears, and that County Court proceedings had been brought against the trustees for unpaid debts owed by the charity.

The charity has been wound up and the two trustees have been disqualified from trustee or senior management roles for 12 years.

Restitution against the trustees was considered by the inquiry but was not found to be proportionate at the time.

Anything unusual e.g. unusual facts or novel/rare use of Commission’s powers

In 2017, one of the trustees appealed against two commission orders against the trustees restricting their use of the charity’s bank account and credit card. The First-Tier Tribunal appeal decision upheld the commission’s orders.

In 2019, both trustees lodged appeals against commission orders suspending them from being charity trustees, and later lodged appeals against orders disqualifying them as charity trustees. Both trustees withdrew the appeals in August 2019 and were disqualified.

An Interim Manager (IM) was appointed to the charity on a pro bono basis to discharge the following functions:

·         to consider winding up the charity and, if necessary, wind up the charity in accordance with the charity’s governing document

·         to make payments to outstanding creditors – to be authorised by the inquiry

·         to close the charity’s bank account

·         to initiate the procedure to remove the charity from the Register of Charities of England and Wales

The IM concluded that the charity should be wound up and removed from the Register of Charities.

Contempt of court ruling

The full judgment has been published in the case of Charity Commission for England & Wales v Raymond Wright & Susan Wright. This was the case we reported in the Bates Wells Briefing back in November last year in which the commission pursued a contempt of court case for the first time against two former charity trustees. The High Court found that the two individuals failed to comply with an order to supply evidence and documentation to the regulator.

Article by Andrew Purkis about CC research

Andrew Purkis has written an article in Civil Society querying the conclusions and policy the commission has adopted on the back of the research it commissions into the sector.

In particular his view is that the research does not justify a policy that holds charities to a higher moral standard than that expected of other sectors.

Tax and VAT

See below under Culture and creative and Sport.

Data protection

Direct marketing

The Information Commissioner’s Office (ICO) has launched a consultation on its draft direct marketing code of practice. The consultation is open until 4 March 2020. As well as covering topics such as lawful bases for processing for marketing purposes, individual rights and exemptions, it covers:

  • Accountability and considering privacy by design when planning marketing activities.
  • Transparency when generating leads and collecting contact details.
  • Profiling and data enrichment.
  • Methods of communication.
  • Online advertising and new technologies.
  • Selling or sharing data.

The ICO also plans to produce additional practical tools such as checklists to go alongside the code.  NB The EU is currently producing a new E-Privacy Regulation (ePR) which will eventually replace PECR. Once the ePR is finalised and the UK’s position in connection with Brexit is clear, the ICO has indicated that it will update the revised code to take account of the ePR.

ICO Fine  

The ICO has fined DSG Retail Limited (DSG) £500,000 for failing to secure 5,390 tills at DSG’s Currys PC World and Dixons Travel stores between July 2017 and April 2018. An attacker was able to install malware allowing it unauthorised access to 5.6 million payment card details used in transactions and the personal information of approximately 14 million people, including full names, postcodes, email addresses and failed credit checks from internal servers.  In January 2018, the ICO fined Carphone Warehouse, which is part of the same company group, £400,000 for similar security vulnerabilities.


Data protection

See above for a new ICO consultation on direct marketing. Daniel Fluskey of the Institute of Fundraising has summarised five key points in his blog here.

Prospect fundraising and GDPR

In this blog for the IOF, Bates Wells’ Lawrence Simanowitz and Hannah Lyons discuss what GDPR has meant for major donor fundraising from a legal and compliance position. Lawrence will be speaking at the Major Donor Fundraising Conference later this month. 


See below under Northern Ireland.



The Prime Minister has announced he will invest over £14 billion in primary and secondary education between now and 2022/23. The funding package for 5-16 schools includes £2.6 billion for 2020/21, £4.8 billion for 21/22, and £7.1 billion for 22/23 compared to 19/20. This will bring the schools budget to £52.2bn in 22/23. As part of this, every secondary school will receive a minimum of £5,000 per pupil next year, with every primary school getting a minimum of £4,000 from 2021/22. The deal includes £780 million extra for children with Special Educational Needs and Disabilities (SEND) in 2020/21.  

The Schools Minister has announced six new Teaching School Hubs to support struggling schools.

Under proposals in a consultation launched last week, all outstanding schools and colleges will be brought back into a regular inspection cycle – with Ofsted visiting every 4 to 5 years. This would affect around 3,700 schools and colleges rated outstanding. The consultation closes on 24th February 2020.

Health and social care

On 18 December 2019, the UK Government’s Secretary of State for Health and Social Care gave a speech setting out his priorities for the NHS following the re-election of the Conservative Government on 12 December 2019. The following four key policy areas were identified together with their associated plans:

  • Infrastructure: the Health Secretary re-stated the election campaign pledge that the Conservative Government would oversee the building of 40 new hospitals over the course of the next ten years together with 20 hospital upgrades. The approval process for further capital works and investment will also be simplified.
  • Prevention: the Health Secretary stated that preventing ill health will be a focus of the Government’s spending agenda. This will involve greater investment in primary care and maternity care to address the geographical disparities in health outcomes around the UK. To that end, pharmacies will apparently become the “first port of call” for those with “minor illnesses”. Vaccination and anti-smoking initiatives will also be promoted.
  • People: the Health Secretary said that recruiting 50,000 new nurses will be the Government’s priority. This will apparently be achieved by re-introducing the nursing bursary scheme that was recently terminated. Aspirations to increase GP numbers and retain NHS consultants are also set out.
  • Technology: the Health Secretary stated that technology will be a key to driving NHS efficiency and, for that reason, he noted the role of NHS Digital in designing, building, deploying and operating digital products and services. It is intended that such technology will be deployed right across the NHS, to include pharmacies, primary care, community care, mental health, hospitals, and social care.

You may have heard in the media about this ongoing case arguing that under-18s have no capacity to consent to gender reassignment treatment.

Social finance

From grants to investing – and back again?  Pioneers Post provides commentary on the experiences of some philanthropic foundations that have decided to offer “repayable grants”. 

How to get social investment back on track: A checklist for foundations. Sarah Forster, CEO and co-founder of The Good Economy Partnership, and Niamh Goggin, of consultancy firm Small Change, write for Pioneers Post about their research into how well social investment is fulfilling the needs of investees. The article set-out common theme of complaint found among investees, and considers the opportunity available to foundations in this space.

Charity Bank secures new investment as it seeks to double its lending to charities and social enterprises by 2024, as part of its plan to raise £10m in new investment to fund expansion. The Esmée Fairbairn Foundation has agreed a £500,000 investment in Charity Bank’s share capital. The bank’s plans include extending its support to smaller charities struggling under funding pressures.

Northern Ireland

The Charity Commission for Northern Ireland is reminding many charity trustees that their annual return is due to be submitted this month.

The Department for Communities is seeking views on the regulation of gambling in Northern Ireland.  The consultation closes on 21 February 2020.

Disclaimer – The information contained in this update is not intended to be a comprehensive update – it is our selection of the website announcements which we think will be of interest to charities and social enterprises. The content is necessarily of a general nature – specific advice should always be sought for specific situations.

This information is necessarily of a general nature and doesn’t constitute legal advice. This is not a substitute for formal legal advice, given in the context of full information under an engagement with Bates Wells.

All content on this page is correct as of January 14, 2020.