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Charities Regulator: make role broad.

By Niall Crowley

Regulator should ensure charities are rights-focused, independent and frugal; promote equality and social justice and are accountable to users.


It is not clear how much longer the Central Remedial Clinic can command our headlines. They are doing their best. We cannot be sure who will follow them into the hot seat. Rehab has put itself out there with some jaw-dropping prominence. Before that we had Holles St Hospital, St Vincent’s Hospital Trust, the religious and industrial schools, the Red Cross and other Development Charity scandals.

There is something rotten within parts of our so-called “charity” sector. Minister Alan Shatter has promised the long-awaited Charities Regulator as the resolution to loss of trust in the sector.

Instigating the Charities Regulator is necessary but not sufficient. The legislation, for example, does not appear to allow it any role in eliminating greed and excessive remuneration. It will usefully require a transparency from organisations in the sector.

They will have to provide basic information about their operations to get on the Charities Register. They will be required to submit annual accounts and an annual report of activities to the Regulator. All of this information will be made public.

This transparency is important. But annual accounts or annual reports of an organisation never tell much about greed and excessive remuneration. Transparency alone will not resolve these issues. Further, transparency alone cannot address equally important issues of low standards in governance or in services provided.

The current debate is premised on the supposed fact that so-called ‘charities’ are doing good work and the obvious danger this work could be undermined by some rogue executives. While many such organisations are doing good work, we have little evidence to support such a premise for the whole sector. A culture of greed and executive entitlement is never aligned with a culture of care and rights.

The Charities Regulator is to be “interim”. A CEO will be appointed through “internal” competition. There are not many, if any, civil servants in the Department of Justice and Equality with the necessary knowledge and understanding of the ‘charity’ sector for an internal appointment to work. This approach also undermines the necessary independence of a Charities Regulator.

An ‘interim’ Charities Regulator will inevitably have minimal resources, insufficient to stimulate and secure the changes in culture and practice needed in parts of the ‘charity’ sector. State institutions tend to remain at or around their start-up budget long into their life span. The key budgetary battle is always the first one and this already seems lost in the notion of “interim”.

Is this why everyone seems so happy with the promise? It looks good and resolves the collapse of trust issue but changes little. We need to be concerned about what sort of Charities Regulator we will get. Remember we have some experience of poor Regulators.

There is the “cosy” regulator. This is the regulator that is tightly-knit into the sector it is regulating. There is an assumption that everyone is operating to the same set of values and good relationships will enable good practices. This is the model that gave us the financial crisis.

There is the “lofty” regulator. This is the expert and professional adjudicator. Things go wrong and the appropriate punishment is meted out to the individual transgressor. Serious illegality will be curbed, but the status quo is maintained. The status quo is not good enough for many who are dependent on the ‘charity’ sector.

There is the “busybody” regulator. This is the interfering regulator that serves as a catalyst for change in the sector. As more and more key social services are publicly funded through the ‘charity’ sector, this is the type of regulator that is required. The ‘busybody’ regulator could inculcate a necessary rights-based culture in provision of these services.

The Charities Regulator will have powers to investigate; and to publish codes of conduct, guidelines and model constitutions.

It could use these powers to set and demand standards for a management culture that reflects a social-justice ethos rather than a business ethos, for an accountability directed to the communities and groups served by the organisation rather than just to funders, for services that create greater equality in society rather than maintaining certain groups on the margins, and for a public funding regime that enables service users to be rights holders rather than grateful recipients.

Will Charities welcome intrusive regulation and what exactly is being promised?