Charities Bill [HL]

My Lords, one cannot fail to understand what the noble Lord, Lord MacGregor of Pulham Market, is getting at. As the noble Lord, Lord Hodgson, has just said, the joint scrutiny committee report referred to this difficulty, and left it a bit in the air. The answer to the dilemma described by the noble Lord, Lord MacGregor, is in the present law, which broadly says that once assets are charitable, they remain so. It is common enough for charities to find themselves in difficulties for one reason or another, and not uncommon for the trustees of a charity to decide that they will in effect cease to function as a charity, and function thereafter as a non-charity—maybe as a non-profit company, occasionally as a profit company. The charity’s net assets are then ring-fenced, and are usually acquired by the profit-making or non-profit-making entity at a market price, so their value remains within the charity net, and can be used, in this instance, for educational purposes. I do not, therefore, see why we need the amendment at all. There is a danger in the amendment. First, the noble Lord, Lord MacGregor, said that he is looking only at rare cases.