Charities newsletter - January 2024

Looking ahead for 2024

2023 was a busy year in charity governance, with numerous statutory changes and updates in guidance from the relevant regulators to stay on top of. It appears that 2024 will be continuing this trend.

Another Charities Act 2022 update

One of the most important updates for 2024 is the long-awaited rollout of the third tranche of provisions of the Charity Act 2022. Originally expected to come into force in autumn 2023, the date for implementation of these changes has been adjusted repeatedly and has now been amended to March 2024.

Among some of the most important changes to be rolled out in the third tranche will be the changes to how charitable companies alter their objects, removing the need for prior approval from the charity commission if the proposed change does not alter the company’s charitable purposes. The changes will also see the introduction of a list of factors the Charity Commission must take into consideration when deciding whether to approve a change of charitable purposes for charitable companies and CIOs.  Additionally, new powers will be introduced allowing the Charity Commission to ratify the appointment of charity trustees where there had been uncertainty concerning their appointment or election. We await to see if those changes will come into force in March 2024 as now expected, or if this date will be changed again. We will continue to keep you all updated.

Following the second tranche of changes rolled out in June 2023, it was expected that the next implementation would be the third and final instalment. However, in October 2023 the Department for Culture, Media and Sport (DCMS) updated its implementation plan for the Charities Act 2022 to confirm that two sections of the Act would be ‘under further consideration prior to commencement’. It has been suggested that these changes, which relate to a charity’s ability to make ex gratia payments, may have an impact on whether national museums can return or repatriate items from their collections on moral considerations. Whilst the debate regarding the restitution of museum collections has garnered increased media attention in recent years, the possible impact on ex gratia payments in the Charities Act 2022 was unintended. The DCMS has therefore postponed the implementation of these sections until their impact can be fully explored.

If you require any further assistance in relation to the Charity Act 2022, please contact Edwina Turner or your usual AC contact.

Big changes at the Charity Commission

2024 is sizing up to be a year of significant change at the Charity Commission, with its chief executive, Helen Stephenson, set to step down from the role in the summer. After seven years in post, Stephenson will be the longest-serving chief executive to serve the Commission and her departure will undoubtedly be a significant transition for the regulator. However, prior to her leaving, Stephenson confirmed that the Commission will publish its new five-year strategy, its previous Statement of Strategic Intent having been launched in 2018. The strategy is anticipated to be published in January 2024, but to date, there has been little indication of which areas will pull particular focus in this statement.

2023 was a particularly busy year for the Commission, having rolled out the trustee portal framework and published a number of new and updated guidance notes, a trend which is also expected to continue into 2024. In particular, the chair of the Charity Commission, Orlando Fraser, has indicated that updated guidance on the acceptance and refusal of donations will be published in early 2024. Readers will not be surprised to hear that this guidance has in no small part been prompted by the continuing discourse regarding the landmark ruling in Butler-Sloss and Others v The Charity Commission for England and Wales (2022). The guidance will be welcome clarification for charities who have struggled to balance the financial advantages of certain donations with reputational or moral considerations of accepting the same.

Fundraising Regulator

The coming year is also set to be a busy one for the Fundraising Regulator who ended 2023 by launching two major consultations, the results of which are expected in 2024.  Readers might remember from our September newsletter that the regulator launched a review as part of its review of the Code of Fundraising Practice. The results of this consultation are also expected to be published in 2024, with the changes to the code being in place for 2025. Conversely, the regulator also launched a consultation on its proposal to increase the levy it charges charities. The consultation is expected to close in February 2024, with updated rates coming into effect in September 2024. This increase will be the first in the regulator’s levy since its inception in 2016.  

If readers require any further information or guidance on fundraising, accepting or refusing donations, please contact Natalie Barbosa or your usual AC contact.

General election

Readers will be aware that the next UK general election is expected to take place in 2024, causing the re-emergence of the discussion regarding charities’ involvement in political campaigning. The issue has caused some concern for organisations that are apprehensive about engaging in any form of political activity. However, although charities cannot be party-political or exist for purely political purposes, this does not mean that they must refrain from all campaigning or political activity. Indeed, many charities will feel that political activity and support for certain policies can be an important means of furthering their charitable purpose.

The Commission recently published a blog on this topic, highlighting that trustees of a charitable organisation who feel compelled to engage in political campaigning should consider the Commission’s CC9 guidance, and underscoring the importance of trustees ensuring their charity’s independence and avoiding the endorsement of particular political parties or candidates.

If you have any queries regarding charities engaging in political activity, please contact a member of our Charities team.

Consultation on mandatory reporting of child sexual abuse

Readers might be aware that in November 2023 the Government launched a consultation regarding the mandatory reporting of child sexual abuse.  a summary of the responses to this consultation is expected to be published in February 2024. Although there is little information regarding an implementation plan, the Government has confirmed that they will seek to ‘deliver mandatory reporting as soon as possible‘. Any charitable organisations engaging with children and young people should be aware of the Government’s plans, and consider the responses of the consultation once reported.

For any assistance in relation to this consultation, please contact Edwina Turner, Catherine Gibbons or your usual AC contact.

Martyn’s Law

Readers may be aware of Martyn’s Law which was mentioned in the King’s Speech in November 2023. Intended to ‘improve protective security and organisational preparedness‘, if passed, this Bill will seek to mandate proportionate measures be taken by venues to plan for and mitigate harm from potential terror attacks. It is expected that the Bill will implement a tiered system whereby premises with a capacity between 100 – 799 people will be placed in the standard tier, whilst venues with a capacity of 800 and above will be in the enhanced tier. Bills of this nature can take some time to pass into law, particularly as the Government has confirmed that they intend to launch further consultations on the draft. However, the Government has indicated that this Bill has been made a legislative priority and we can therefore expect further movement on the matter this year. The implications for those affected by the proposed changes will mean that early planning, keeping abreast of the proposed changes and engaging with consultations where appropriate will be imperative.

Complaints regarding door-to-door fundraising

In their Annual Complaints Report for 2022/2023, The Fundraising Regulator reported that complaints regarding door-to-door fundraising more than doubled between April 2022 and March 2023. The report highlights that many of the complaints reported inappropriate behaviour and concerns regarding underage or potentially vulnerable people being approached by the fundraiser.

Many readers will be aware that the issue of door-to-door fundraising has been polarising, with some charities being uncomfortable with the concept whilst others believe it to be an invaluable tool for building awareness and support for their organisation. Our own Natalie Barbosa has considered this issue in her recent blog post, exploring the possible use of body cameras to assist fundraisers with this issue.    

Employment update

Our employment team have published several interesting blog posts recently which may be of interest:

• In her recent blog post, Libby Hubbard discusses the changes the Government has made to statutory paternity leave provisions in the draft Paternity Leave (Amendment) Regulations 2024. Setting out the important tweaks made in the legislation, Libby also highlights the provisions organisations will need to update in their employment policies.
• A further blog post co-authored by Libby Hubbard and Anna Dabek considers the new government guidance on holiday entitlement, highlighting the continuing lack of clarity regarding irregular and zero-hours workers. The blog includes a list of action points for employers to consider when dealing with annual leave entitlements.

For more information

For more information or advice on the topics raised in this month’s newsletter, please contact Charlie Maddox. Charlie is an executive in the governance, funding and corporate team. With over three years of experience advising charity and education governance clients on academy conversions, charity incorporations and many other governance structure amendments, Charlie regularly establishes charitable incorporated organisations and charitable companies registering with the Charity Commission and Companies Couse. Charlie also advises charities in relation to their property, including trust deed reviews and amendments, preparation of deeds of appointment and retirement and vesting declarations.

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