6: The regulatory response

Beyond Government support to facilitate giving and redirect funds towards charities tackling COVID-19 and its effects on the frontline, the role of charity regulators taking a pragmatic and flexible approach will be crucial to the sector’s ability to adapt to the new and fast-moving situation and respond quickly to the increase in demand.

The Charity Commission has already shown flexibility in allowing charities to submit annual returns at a later stage. Other regulators and public bodies should follow suit where possible.

Previously mentioned suggestions in this paper include the Charity Commission clarifying guidance on foundation spend-down possibilities.

Key Ideas

More flexibility to redefine charitable mission

The Charity Commission to be more flexible in redefining the mission of a charity. For charities considering whether they can help the effort to tackle COVID-19, the ‘charitable objects’ set out in their governing document that may allow such activity include: the relief of poverty, hardship or distress,  of the elderly, and the advancement of education, of the life of young people or of health.

If they do not have the express power to do so in their governing document, permission is needed from the Charity Commission to amend charitable objects and proposed changes need to be “reasonable, consistent with what your charity does, and not undermine your existing objects.”  

The Commission has committed to prioritising requests required urgently because of COVID-19, but more flexibility in a temporary measure permitting a charity to expand or change its existing mission statement could enable organisations to undertake work necessary for the coronavirus response or the period of civil society rebuilding that will follow.
NET
   
By 22 April 2020 the National Emergencies Trust distributed distributed £17.5m of funds raised from their Cornoavirus appeal, through UK Community Foundations.

Release dormant charity funds

Identify dormant charities and release their funds into a national funding vehicle that addresses the crisis.

The money held by inactive charities in dormant trusts could be redirected to support charities’ working on the COVID-19 response or the charity sector’s resilience more broadly. These funds could be channelled into a central national funding vehicle, such as the National Emergency Trust (NET) or the National Lottery.

The NET, for example, was set up in 2019 following the Grenfell Tower and Manchester Arena tragedies to coordinate disaster fundraising responses and act as a trusted channel for funds and donations, and has already launched its Coronavirus Appeal to raise money for local charities and grassroots organisations that provide vital support during the crisis.

Government could provide legal and financial guarantees to cover any emerging risks due to fast tracking the release of the funds and their use in addressing the crisis.

Conclusion

While we have been clear philanthropy is not a panacea for the ills being suffered by civil society right now, we believe that there is definitely scope to build on the encouraging response we have seen already from individuals, foundations, companies and others; and boost giving even further in order to support civil society through this crisis and the process of rebuilding that will follow.

We offer these ideas in the hope that they will stimulate thought and debate, and we will gladly work with Government and other interested parties in thinking through how to put them into practice as soon as possible.  

Paper authored by:

Rhodri Davies, Head of Policy
Daniel Ferrell-Schweppenstedde, Policy Manager
Cleodie Rickard, Policy & Public Affairs Executive

< 5: The response from business

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