Raising the public benefit hurdle?

Will the failure last week of three charities, notably two private schools, to meet the first round of public benefit tests be seen as a watershed moment in the four hundred year history of charity law? The time when the tide turned to make charities really struggle against the waves of accountability to prove their worth? It remains to be seen whether the battle lines need to be drawn already - one Daily Telegraph columnist is getting ready nonetheless - branding it as nothing less than "class war". Or is this just part of a wider, long-term trend for charities to prove their accountability? As Katherine has discussed last week in this think piece on trust in charities, in the wake of declining public trust in a variety of arenas (government, institutions, business), it seems a charity’s status may no longer be the unalienable right it was once assumed. Trust in charities has to be earned and the increasing legislation and demand for transparency will both facilitate and increase the pressure.

Nevertheless this first test gives us some idea of what independent schools must do to retain their public benefit: namely ensure they provide more bursaries to children from families that cannot afford to send their children to private schools. The Charity Commission says charities that charge fees, such as private schools, must ensure that “people in poverty” can use their services.Merely sharing their facilities and expertise with those around is not enough. Some may like to believe this might be part of a drive to create a more egalitarian society with greater opportunities for all; Alan Milburn’s report released yesterday on social mobility points out that 75% of all judges and 45% of top civil servants are privately educated. There is obviously an opportunity gap in both the education and work system in the UK but only time will tell whether in a recession with poverty and inequality rising, there will be greater public and governmental pressure to ensure both fairness and transparency for all.

Last updated at 15:21 Thu 23/Jul/09.
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I think we need to recall that the ability to demonstrate public benefit has always been at the heart of charitable status – that is why charities have such high levels of public trust and confidence. For years NCVO campaigned for the reform of charity law because it is important that all charities can show that they meet this testregardless of their purpose . And the Charities Act 2006 had cross-party support when it went through Parliament.

We are going through a time when all sectors - including our own - are being called into question in relation to accountability and transparency, so it makes total sense that charities should be asked to demonstrate their worth and the good that they do in society. It is essential that we maintain the high levels of confidence entrusted to us by the public. The public benefit test will help to achieve exactly that, therefore protecting and promoting the charity ‘brand’ in the long term.

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