Three new reports on partnership working between faith and local government.

Joint registration for HMRC and Charity Commission is getting closer, suggests Hodgson

The prospect of a single charity registration process for both HMRC and the Charity Commission is not far off, Charities Act reviewer Lord Hodgson hinted to a conference audience yesterday.

Lord Hodgson first mooted the idea in his review of the Act published last summer, and despite some opposition within the sector he has been lobbying HM Treasury to introduce it.

Yesterday he told the Association of Charitable Organisations’ annual conference that he shared NCVO chief Sir Stuart Etherington’s concerns about the impact of the Cup Trust scandal on the reputation of the sector, and that a joint registration process would go some way to clamp down on such tax-avoidance schemes.

“I’ve asked the government to look into this very quickly,” Hodgson told delegates. “It may surprise you to learn that HMRC and the Charity Commission do not have parallel and matching ways of choosing who is charitable – for instance you can get gift aid without being a charity, which seems to me quite extraordinary.

“I think there should be one system for getting charitable status, both from the point of view of HMRC and the Charity Commission, and it doesn’t seem to be beyond the wit of men for that to be done.”

Hodgson said he has told Paul Deighton, commercial secretary to the Treasury, about the duplication and anomalies in the current system, and implied to the audience that Deighton was sympathetic to his recommendation for a single registration process.

“I’m not saying it will stop those like the Cup Trust, but it would do something,” Hodgson said.  “So I hope it can be done without much further ado.”

Higher registration threshold

Lord Hodgson also used the Cup Trust case to revive another of his review recommendations, that of raising the registration threshold to £25,000 and adding the suffix ‘small’ to all charities below this threshold, so the public is aware they are not subject to the same level of regulatory scrutiny.

“I know that idea has got the red pen from the Charity Commission," he said, "because they want to continue with the idea that they can somehow regulate all charities, and I think that's foolish. They can't do it, and they should say they are not able to do it and guide the public to make their own minds up about which charities they should support."

25-year 'driving test' for charities

He also mooted a new idea that he had not included in his Charities Act review but that he favoured nonetheless – that of a 25-year ‘driving test’ for charities, to check they are still fulfilling their charitable purposes.

Hodgson has previously raised concerns about “semi-moribund charities” that are little more than social vehicles for their long-standing trustee boards. The ‘driving test’ proposal would help to tackle this problem, he suggested.

“I didn’t recommend it [in my report] but it is an issue that is there and in light of all the news about the Cup Trust and others this is one idea that perhaps people may wish to return to,” he said.

Sir Stuart: Commission must focus on areas of highest risk

Sir Stuart Etherington, who spoke at the same conference, added that the regulator needed to “zone in” on those issues where public trust and confidence in charities is most at risk and focus its attention and resources in those areas.

“Tax-avoidance is an area that could very very swiftly damage trust and confidence in the charity brand,” Etherington said. “That’s why it’s got to be tackled vigorously and that’s why I’ve taken a such an aggressive stance in relation to the regulator.”

This article was taken from Civil Society – http://www.civilsociety.co.uk/governance/news/content/15119/