Charities Bill [HL]

I shall approach the amendment on a slightly different tack this time. As the noble Lord, Lord Hodgson, knows, I am usually the first to give him credit when it is due. I have admired for some time his instinct for deregulation, which is admirable—we are all in favour of deregulation—but he has let us down rather badly with this amendment. It would make things significantly worse, more difficult and expensive for potentially a large number of charities. There are many landowning charities, such as those governing recreation grounds, allotments, libraries and so on, that have little or no income but have land interests. Because they are not required to prepare a balance sheet showing the market value of their assets, they are often not in a position to know whether they would exceed the £2.8 million asset threshold. There would have to be some sort of accompanying requirement on them to have their assets valued. However, some of those charities have such small liquid resources that, frankly, they could not afford the cost of a valuation, let alone the cost of the audit that they would then have to undertake if they found that,   by chance, their assets were worth more than £2.8 million. It would be highly unsatisfactory if they had to sell some of their assets to pay for the cost of having those assets valued and their accounts audited. What would be the benefit in that? I cannot see it at all. We know from Charity Commission figures that there are 123,000 charities with an annual income below £100,000. The proportion of those that have assets worth more than £2.8 million is not precisely known, but the commission’s tentative estimate suggests that 10,000 or so charities could be caught by the requirement and would have to pay possibly for a valuation and certainly for a professional audit. I do not know how much such things cost; the noble Lord, Lord Hodgson, knows a great deal more about them than I do, but it seems out of all proportion to the risk involved in leaving them in the unaudited category. Those with income between £10,000 and £100,000 are in any case subject to a requirement for an annual independent examination. If the noble Lord, Lord Hodgson, wanted to salvage his deregulatory credentials, I would invite him to withdraw the amendment.