I am afraid that this is another of my long-standing quarrels. It is about the Charity Tribunal. Before the 2006 Act, the only appeal against the Charity Commission was to the High Court. That was expensive, slow and difficult to achieve. The then Labour Government, to their
credit, introduced the Charity Tribunal in the 2006 Act. The plan was that it would improve access to justice: it would be quick, low-cost, user-friendly and non-adversarial. There was a subsidiary aspect to that, which I am not sure that the designers of the 2006 Act quite recognised, which was about helping more charity law precedents to emerge. Much of what charities are guided by now is quite old and backward-looking—we have discussed the tin-rattling regulations covering cash collections, which date from 1916. Re Resch, the big case about public benefit—an issue that we shall come to later this afternoon—concerning a private Australian hospital in the grounds of a state one dates from the 1920s. We were hoping that the Charity Tribunal would act to help bring charity law forward into the 20th and 21st centuries but the early experiences were a bit disappointing. As is too often the case, everybody reached for their lawyers—as they are entitled to do. I was not present at the end of the independent schools case that came before the tribunal, but I am told that nine QCs were present, which must have cost a bit of money.
However, although it has been slow, there has been progress. There has been more determination on the papers, which means that the tribunal does not require people to attend. More litigants have been appearing in person, which I think is also a good thing. During my review, a lot of evidence was received about the operations of the tribunal and ways they could be improved.
Some of these issues are being addressed by the Law Commission in its current consultation—which I think will be the escape hatch that my noble friend uses in a minute or two—but the Committee might like to be aware of a couple of extraordinary features. In order to appeal against the Charity Commission, a charity has to go to the commission to ask its permission as to whether the use of its funds to make the application is charitable. That seems to be entirely perverse. There is an inherent conflict of interest if the Charity Commission is on one side, the charity is on the other and the charity has to ask, “Is it fair to use this to attack you?”. That does not lead me to believe that there will be an even-handed decision. I hope that the Law Commission will move responsibility for this to the Charity Tribunal.
The second issue worth drawing to the Committee’s attention is that the Charity Commission cannot apply to the tribunal without the permission of the Attorney-General. It seems to me extraordinary that the top regulator in this sector does not have that freedom of action. It must be a threat to its independence if it has to go to a law officer of the Crown in order to be able to get determination of a case. I hope very much that the Law Commission will decide that the Charity Commission is free to act, even if it must of course still inform the Attorney-General. That would be a good way of bringing the law up to date.
There remains a major impediment to the effective working of the tribunal which the Law Commission has decided it cannot address, and that is the tribunal’s jurisdiction, which appears in Schedule 6 to the 2011 Act. There are 10 pages of it, with a series of headings about what the decision, direction or order is, who the
applicants can be and what the tribunal’s powers are in response to a decision. That table was seen by the vast majority of contributors to my review as overly complicated and narrowly drawn. Even specialist charity lawyers complained of difficulty in understanding it. The list of cases brought before the tribunal also shows a large number being struck out for being outside the tribunal’s jurisdiction. That raises the question of whether its jurisdiction is sufficiently well defined to address the concerns people have about the commission’s work. Of course, with any forum there will always be cases that fall outside its jurisdiction, but in combination with the wider concerns about Schedule 6, the number of rejected cases raises questions.
The Schedule 6 table is focused on a specific range of formal legal decisions made by the commission. In some cases, but crucially not all of them, this includes the decision not to exercise a power, and the decision not to open a statutory inquiry into a charity is a frequently cited omission. Many of the decisions referred to in the schedule relate to the exercise of legal powers that the commission, as part of its more refined and focused approach to regulation, is choosing to make less frequent use of. Concern has therefore also been expressed that as the commission moves towards this lighter-touch regulatory regime, even more of its work will fall outside the scope of the tribunal’s jurisdiction.
Amendment 22B is designed to clarify the situation by providing a right of appeal against any legal decision of the Charity Commission and a right of review of any other decision by the commission. The new clause proposed in the amendment has two elements. The proposed changes to Section 319 of the 2011 Act deal with appeals and set out, very simply, who would be able to make the appeal: it can be any trustee or director of a charity or charitable company or,
“any other person who is the subject of the relevant decision”,
or is “significantly interested in” or “affected by” it. It lays out the powers the tribunal would have in responding to these appeals. The proposed changes to Section 321 deal with reviews. Finally, subsection (6) of the proposed new clause would delete the dreaded Schedule 6, which I hope will foreshorten and cut out the regulatory regime. This is not a complex issue. Access to the Charity Tribunal is unnecessarily complicated, particularly for smaller charities, and the charity world will appreciate and benefit from simplification. I beg to move.