Charities Bill to save sector “millions of pounds” in compliance costs, research reveals

The proposed new Charities Bill could save the sector up to £2.8 million per year, the latest research has revealed.

The report comes after the Charity Commission published new details outlining how the new powers and processes could save not-for-profits organisations thousands of pounds in compliance costs.

Announced earlier this year, the regulator says the new laws will simplify “a number of relevant processes to help charities consolidate and restructure” – for example, by making it easier for charities to amend governing documents, dispose of land or carry out mergers.

For the sector, this means:

  • Charities and trustees will be able to amend their founding documents “more easily”, subject to Charity Commission approval
  • The new laws will extend access to a “much wider pool” of professional advisors on land disposal following concerns that the current regime was “too complex”
  • Not-for-profit organisations will have “more flexibility” to make use of a permanent endowment
  • The new rules will allow for the payment of goods provided to a charity by a trustee in “certain circumstances” – for example, where the goods are cheaper and are in the “best interests” of the charity
  • The rules around ‘failed’ charity appeals – for example, where too little is raised – will be made “simpler and more proportionate”.

The Charity Commission said the reforms will also save charities significant time and money – such as legal costs – of “at least £28 million” over a ten-year period, or £2.8 million a year.

“These measures will simplify a number of processes and provide a more consistent legal framework, whilst ensuring appropriate safeguards,” said the regulator.

“Alongside this, the added clarity of issues with the law that are causing uncertainty will allow charities to focus on delivering on their mission.”

Click here to access the Charities Bill fact sheet.

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