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News - 5 February 2014

Charity Commission not fit for purpose

In a damning report, the Public Accounts Committee said it had "little confidence" in The Charity Commission and that it is not "fit for purpose" and has persistently failed to tackle abuses of charitable status properly.

The cross-party committee also expressed concern about what it said was the substantial abuse of Gift Aid and other tax schemes designed to encourage charitable giving by individuals and companies.

But the commission, which oversees more than 160,000 charities in England and Wales,
rejected this criticism, saying "rapid progress" was being made.

Stuart Coleman, Manager of the Tax Department of ABDS comments:
“Abuse of charity-related tax reliefs cost an estimated £170m in 2012-13, the report said, and risked "giving the charity sector a bad name. The MPs' criticism of the Charity Commission comes just weeks after the National Audit Office said it needed to up its game.”

The MPs said the Charity Commission had been "performing poorly" for many years but a strategic review in 2011 had failed to bring about the "fundamental transformation" needed. Enforcement powers were rarely used with the watchdog not removing any trustees in the past three years and only suspending individuals on two occasions while charities had only been prevented from entering into specific transactions 17 times

Responding to the MPs' report, the Charity Commission said it "completely rejected" claims it had no strategy and insisted it was launching more statutory inquiries and had used its enforcement powers 657 times since last April.

If you need any help and advice with Charities or Academy Schools, contact Lavinia Newman or Peter Ham now to discuss how ABDS can help bring their experience to these matters.

ABDS Chartered Certified Accountants of Southampton.
Tel: 023 8083 6900  E-mail:

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