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UK Government agrees to reforms on charity spending and investment

reforms on charity spending

UK Government has agreed to reforms on charity spending and investment, following a report made by the Law Commission in 2017. The UK Government has responded to the 43 recommendations and has accepted all but six of the proposed changes.

Law Commission’s report aims to:

  1. Remove unnecessary regulation and bureaucracy to maximise the efficient use of charitable funds. The aim is to prevent the disproportionate diversion of charitable assets and trustee time on compliance with regulation from which little or no benefit is derived, whilst providing effective oversight.
  2. Increase the flexibility of trustees to make decisions in the best interests of their charities, in particular, to give trustees wider or additional powers to make decisions without having to obtain authorisation where appropriate.
  3. Confer wider or additional powers on the Charity Commission to increase its effectiveness. This includes enabling the Commission to carry out its current functions more efficiently and to take action where it ought to be able to but cannot currently (for example, to regulate or assist charities).
  4. Ensure adequate protection of charity property to enhance donor confidence and public trust, in particular supporting confidence in the use of donations currently and in the future.
  5. Remove inconsistencies and complexities in the law, making it clearer for charity trustees, staff, volunteers and professional advisers seeking to apply it and comply with it, as well as reducing legal and other professional costs. This includes seeking to minimise the potential for unintentional mistakes and the associated costs of addressing them.

The UK Government rejected a recommendation that would review charities’ right of appeal against decisions made by the regulator. The changes are set to be implemented when “Parliamentary time allows”.

For more information, please read the full press release. 

Loosemores is ranked Tier 2 for Charities & Not-for-profit in Wales by The Legal 500 and our Charity team lead, Rebecca McCarthy, is recognised as a ‘Rising Star’ for Charities & Not-for-profit in Wales.

If you need any specialist advice from our team of legal experts, call us on 02920 224433 or contact Rebecca via McCarthyR@loosemores.co.uk.

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