Understanding the New Charities Bill
Announced on 11th May, the Charities Bill is a new piece of legislation that could bring a number of important changes regarding charity law. These proposed changes have been discussed for several years by the Charity Commission, the Department for Digital, Culture, Media & Sport and the Law Commission.
Some of the key elements of the bill that charities should familiarise themselves with include:
- Government documents or royal charters can be more easily amended, although in some cases, they may still be subject to approval by the Charity Commission and Privy Council.
- Charities will be able to utilise simpler and more proportionate rules on failed appeals, such as if an appeal does not raise sufficient funds. In such cases, the charity would be allowed to spend contributions less than £120 on similar charitable purposes without being required to contact donors for permission.
- Professional advisors will be more accessible for guidance regarding land disposal and other rules. This change is intended to help organisations save time and money when attempting to sell land.
- Organisations could have greater flexibility to use permanent endowments. Under this proposed change, trustees would be able to borrow up to 25 per cent of the value of a permanent endowment fund without permission from the Charity Commission.
- Trustees may be eligible to receive payment for goods they provide to their organisation if it’s in the charity’s best interest. For example, if an organisation has the opportunity to acquire goods from a trustee at a lesser cost than elsewhere, the transaction could be allowed without Charity Commission approval.
The Charity Commission hopes that these changes will simplify charity operations for trustees and help maximise the benefits that charitable organisations can provide.