Charities Bill [HL]

moved Amendment No. 35:"Before Clause 20, insert the following new clause—"    ““POWER TO INSTITUTE INQUIRIES (1)   Section 8 of the 1993 Act is amended as follows. (2)   At the beginning of subsection (1), insert ““Subject to subsection (1A) below,”” (3)   After subsection (1), insert— ““(1A)   The Commissioners may only institute such an inquiry on reasonable grounds and such grounds must be communicated in writing by the Commission within 7 days of the opening of such an inquiry to— (a)   the persons who are or claim to be the charity trustees of every institution which is the subject of such an inquiry, and (b)   (if a body corporate) each institution which is the subject of such an inquiry.”” (4)   After subsection (6), insert— ““(6A)   In the case of either form of publication determined by the Commissioners under subsection (6) above, the Commissioners shall allow the persons who are or claim to be the charity trustees of every institution which is the subject of such an inquiry to add their own comments to such report or statement provided such comments are   not manifestly unreasonable and are provided within such reasonable period as the Commissioners may determine.”””” The noble Lord said: Amendment No. 35 would insert a new clause into the Bill, entitled, Power to institute inquiries. While the new proposal to include the statement of the commission’s general duties as outlined in the Bill—in particular, the requirement that the commission must have regard to the principles of best regulatory practice—is helpful, it is suggested that the commission’s free-standing power to open an inquiry into a charity should have specific principles expressed as being applicable to carrying out all or any such inquiries. In the past, the commission has been in the practice of opening inquiries without giving written notice to the charities affected. It now gives written notice to charities on the opening of an inquiry. Its reasons for opening such an inquiry are often implicitly clear, but we suggest that its obligations on taking such a step should be broadened and made explicit. The opening of an inquiry is potentially a damaging matter for a charity. It may well be an occasion on which a charity or its trustees would wish to refer such a matter to the Charity Appeal Tribunal. Indeed, such a decision of the commission is a matter which is expressly reviewable under paragraph 3 of Schedule 4 relating to the tribunal. Because of the potential impact of such an inquiry on a charity, it is very important that charities and their trustees should know why the commission has considered it appropriate to take such a step, not least because it may be possible to dispel concerns quickly and readily, thus avoiding potential further damage to   the charity. This amendment would ensure that charities are notified of why the commission has taken the step to initiate an inquiry, and surely this is a desirable feature. Subsection (4) of the amendment could be described as the ““right to reply”” provision. Amendment No. 48, tabled by my noble friend Lord Swinfen, covers some of this ground and I apologise if I am stealing his thunder. It has been brought to our attention that to date the commission has been in the habit of producing reports ex cathedra, with the charity or individuals who are the subject of the report having no prior view of what is said about it or them. Not only is that clearly unsatisfactory, it is also at odds with modern administrative practice. No doubt some lawyers would argue that it is in contravention of the ECHR. Too often we are told that such reports contain not just errors of misinterpretation, but straightforward errors of fact. Surely it is in everyone’s interest that these reports should be factually accurate and that the charities or individuals concerned should be able to add reasonable comments on the qualitative conclusions reached by the inquiry. According to the Government, a key strategy objective behind the Bill is to maintain public confidence in the charitable sector. This is most likely to be achieved if the reports of inquiries are as consensual as possible. The commission is to gain significant powers under the Bill, and this new clause would be a useful check and balance. I beg to move.