Charities Face £4m Adverts Bill

Cash-strapped charities face a £4m bill under proposals by the Scottish Executive to make organisations advertise changes to their constitutions. An executive consultation on the reorganisation of charity regulations proposes that organisations with an income of over £250,000 would have to advertise “significant” changes to their charitable aims in the national press, at a cost of up to £5,000 for each advert.

Now charities are calling for the executive to scrap the proposals believing the move could make some smaller charities go to the wall.

The executive believes the move would enable better public awareness of a charity’s specific purpose. However, in a written response on the consultation, the Scottish Council for Voluntary Organisations (SCVO) say that the public interest would not be served by forcing charities of a certain income to use their hard-earned income for adverts when their cash would be better used for “public benefit”.

Instead, says the organisation, the information would be more easily accessible on the Office of the Scottish Charities Regulator (OSCR) website.

“Given the technology that most people now regularly use, the existence of a new regulatory regime and the need to spend charitable funds properly for public benefit, we assert that the only place details of charities’ reorganisation should have to be appear by law is the OSCR website,” the response states. “It’s free and the more OSCR’s website is used for such things the more it will become the place to look.

It continues: “We do not believe that it is appropriate to place charity trustees in the invidious position of having to consider whether the detrimental effect to the charity of this expenditure outweighed the advantages of reorganisation.

The changes could affect between 600-800 charities and charities are warning that being forced to pay £5,000 to advertise a re-organisation could force them to the wall.

SCVO also said that the proposals could have a significant impact on a number of charities due to the changes which have taken place in charity law earlier this year as many larger organisations re-organise structures and procedures to enhance their ability to deliver on their charitable purposes and to meet the new public benefit test.

Andrew Jackson, SCVO policy officer, said: “Accountability and transparency is essential if charities are to retain the public’s confidence. However, it is difficult to see how this proposal would make a charity’s mission any clearer to the public when it would be prohibitively expensive to a number of organisations and could capture a potentially larger audience if changes were advertised on OSCR’s website.

A spokesman for the executive said all responses to the consultation would be carefully considered after it closes on January 15.