What does the UK’s departure from the EU on 31 January 2020 mean for charities and social enterprises? In this Bates Wells briefing, we explore the legal mechanics of Brexit, and experts from around the firm give their thoughts on the potential short- and long-term implications for the sector in specific areas.
Stephen Lloyd Awards
The search is now on for our next cohort of finalists who are on the brink of creating systemic social change with their clever idea. Could that be you? Scroll down to learn how to apply to the Stephen Lloyd Awards.
At a glance
The Charity Commission has posted a blog about journalism as a charitable purpose.
NCVO’s new report on the forces and trends that will affect charities in 2020, “The Road Ahead” is now available to read.
The Information Commissioner’s Office has issued a “Statement on data protection and Brexit implementation – what you need to do”.
Blogpost on journalism as a charitable purpose
The commission has posted a blog by its Director of Legal, Aarti Thakor, about journalism as a charitable purpose. The commission says that the government response recognises that charities can and do use journalism as a tool to further their charitable purposes, but some may struggle to understand their options; the blog then goes through the ways charities can do so within the charity law framework.
This blog follows the government response to the Cairncross Review of the sustainability of high-quality journalism in the UK – in its response the Government has rejected the proposal that a charity which carries out journalism should not have to pass the same test of “public benefit” as other charities.
The commission has announced that it has opened an inquiry into the grant-making charity Resham Helping Hand (1120198). The charity’s purposes include providing overseas aid and humanitarian relief in Pakistan. The commission’s engagement started in response to information provided in the charity’s annual return, ultimately issuing an action plan to address concerns around due diligence and monitoring the end use of charitable funds. The commission has exercised its power to temporarily restrict the charity’s transactions in order to protect charitable funds.
|Name of organisation||Brief description||Anything unusual e.g. unusual facts or novel/rare use of Commission’s powers|
|Alternative Housing (former registered charity 1152412)|
CC press release
|The charity’s objects were to provide accommodation, support and care to those in need within Bristol. The inquiry was opened following the charity’s conviction for six breaches of the Management of Houses in Multiple Occupation (England) Regulations 2006.|
The inquiry found the charity looked like it had ceased to operate. The only person recorded as a trustee on the register at the time told the inquiry he had never been a trustee. The charity failed to file accounts in accordance with charity law over several years. The inquiry also found links between trustees of the charity and the directors of companies the charity had paid significant charitable funds to, but no evidence to suggest apparent conflicts of interest, had been declared or managed appropriately.
|The charity was subject of a national media report titled ‘Bristol housing charity tops list of UK’s most-prosecuted landlords’. Reasons for the prosecutions included the charity failing to maintain firefighting equipment and fire alarms, failing to ensure the internal structure of the property was maintained and failing to ensure that the water supply and drainage system serving one property was kept in good, clean and working condition.|
The commission has now removed the charity from the register on the basis that it was no longer operating.
Policy on appointment of interim managers
The commission has updated its policy on the appointment of interim managers by adding a full list of practitioner firms approved to provide Interim Manager services for the commission.
Whistleblowing privacy notice
The commission has published a privacy notice explaining how it processes your personal data when you contact it as a whistleblower.
Schools and hospitals in Wales
The Welsh Government is consulting on:
- whether charitable relief for schools and hospitals provides fair and appropriate support
- the potential effects of making any changes to the level of charitable relief provided
- any particular exemptions if the Welsh Government were to change current eligibility for charitable relief.
The consultation closes on 23 April 2020.
NCVO’s new report on the forces and trends that will affect charities in 2020, The Road Ahead, is now available to read. It’s split into four sections covering politics, the economy, social and technological change. Elizabeth Chamberlain, NCVO’s Head of Policy has written her own summary of the 20 things to think about in 2020.
NCVO has also written to government ministers setting thoughts on what should happen to the Office for Civil Society should its current home – the Department for Digital, Culture, Media and Sport (DCMS) – be dismantled in a Whitehall reorganisation.
Exit from EU
On Friday, NCVO published “Brexit day: What next for charities?”
See below under Data protection, Competition and Scotland.
Exit from EU
The Information Commissioner’s Office has issued this “Statement on data protection and Brexit implementation – what you need to do”.
See above under Rate relief.
The government has guaranteed every secondary school at least £5,000 per pupil next year, and every primary school at least £3,750 per pupil.
Youth projects are to benefit from a £7 million government investment. The Youth Accelerator Fund has been set up to address urgent needs in the youth sector and expand existing successful projects run by Sport England, National Lottery Heritage Fund, Arts Council England and British Film Institute.
Local Access – six places chosen to begin their journey to tackle inequality. Six areas across the UK will receive a share of a new £33m investment programme, operated by Access – The Foundation for Social Investment and Big Society Capital, aimed at tackling inequality through boosting the social economy. This announcement was also covered in Civil Society Media, providing some commentary on the implementation of this programme in Greater Manchester.
Three big achievements for CDFIs in the last year. Big Society Capital reviews the progress of its Community Investment Enterprise Facility (CIEF) launched in 2018. This £30m fund for CDFIs aims to help them meet the financing needs of underserved small businesses. The CIEF is supporting 3 CDFIs, which have deployed £9.5m to 189 small businesses.
Lloyds Bank Foundation announces new investment of £2.5m in charities seeking to influence and improve the criminal justice system. Grants are being made to 17 charities to help them make positive impacts on the criminal justice system. The programme aims to combat issues such as overcrowding, staff shortages, assaults and self-harm, the failure of the privatisation of parts of the probation system and high reoffending rates.
The Aviva Community Fund 2020 is offering charities a share of £1m. Charities and community groups with projects that promote community resilience or improve financial capability and inclusion can apply for a share of £250,000 each quarter over the next year.
“Match Trading – the basics is an evaluation summary from new research commissioned by the School for Social Entrepreneurs’ Matched Trading taskforce. The research shows that social sector organisations and community businesses typically increase their income from trading by 64% over a year with the support of a grant and a learning programme, which the research finds is 2.5 times the pace compared to a traditional grant recipient. Civil Society Media provides commentary on the new research.”
Charities minister: Help us avoid ‘bid candy’ situations in government contracts. Pioneers Post reports on this year’s National Social Value Conference, including comments from the UK’s minister for civil society that the social impact achieved through the government’s £49bn spending is not up to scratch.
Culture and creative
See under Youth Services above.
See under Youth Services above.
The sixth edition of the Good Merger Index reports 58 mergers involving 116 charities and social enterprises in the year of 2017/18. You can download a two page digest which summarises the key statistics and trends.
On 28 January 2020, the Competition and Markets Authority (CMA) published guidance to explain how Brexit affects its powers and processes for antitrust, merger control and consumer protection law enforcement during the transition period set out in the Withdrawal Agreement, towards the end of that period, and after it ends.
Next week a consultation closes on the replacement of EU Structural funds in Scotland post EU-exit.
OSCR has published an Easy Read version of its guide to being a charity trustee, for those who might have difficulty reading.
OSCR has announced that it is about to ask charities to help with its Scottish Charity and Public surveys 2020.
CCNI is creating a list of trustees and a list of interim managers, who can be called on to provide assistance in a charity either on a short or long term basis – and is looking for interested parties to apply.
Stephen Lloyd Awards
Applications are open for the 2020 Stephen Lloyd Awards. Start-up charities, social enterprises, founders and thinkers who are ready to make positive changes to our world with their outside-of-the box solutions to society’s problems are invited to apply. Applications close at midnight on 15 March. The Awards provides emerging innovations with the vital encouragement needed to cultivate their ideas and spread their impact. Winners receive funding of up to £20,000, along with an opportunity to receive valuable pro bono support from experts in the charity and social enterprise sector. For full details on the application process and how to apply, please visit www.stephenlloydawards.org or email Mona Rahman at [email protected].
If your charity is looking for new trustees then you might be interested to hear that you can now share your advert on the Trustee Unlimited website and connect with their networks. Trustees Unlimited is one of the UK’s leading trustee and board recruitment agencies, working with a broad portfolio of organisations such as charities, social enterprises, housing associations, student’s unions and more. As a proud partner of Trustees Unlimited, we are excited to share this news with our contacts, so make sure you click here to find out more and get started with posting your ad!
Trading subsidiary health check
Has it been some time since you set up your trading subsidiary? Our team of charity lawyers can help you to keep up to date with the latest guidance around the relationship between charities and non-charities, ensure that you are taking account of the latest accounting guidance and are making the most of the tax advantages for your charity. Click here to find out more.
Disclaimer – The information contained in this update is not intended to be a comprehensive update – it is our selection of the website announcements made in the week up to last Friday 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 February 4, 2020.