A landmark ruling means that charities can now deliver services, which public authorities have a statutory duty to provide. The decision announced by the Charity Commission goes against its previous approach and recognises the increasing involvement of the voluntary sector in providing services.Formerly the Commission’s line was that charities could not usually use charitable funds to pay for public services, where a public authority had a duty to provide them, but could only supplement them.
The new decision follows a request for a review of their status by the Trafford Community Leisure Trust and the Wigan Leisure and Culture Trust, which have both now been registered as charities. It reverses the previous rejection of their application for charitable status.
The Commission said that in reaching its new position it had considered whether the two organisations were sufficiently independent from their respective local authorities and to what extent they could be charities if they were set up to carry out statutory duties required of public authorities
The review also looked again at the extent to which existing charities may carry out public services. The Commission says the decision means that it is now for the charity’s trustees to decide if they should contract with a public authority, but in doing so they need to consider a number of factors, including the interests of their beneficiaries, the funding on offer and the resources available.
Kenneth Dibble, the Commission’s Director of Legal Services said that interpreting charity law was an ongoing process. “This decision represents real progress at a time when charities are being encouraged to develop both capacity and ability to deliver better public services alongside public authorities.”
The detailed decision published by the Commission inludes full guidance for charities and can be read at http://www.charitycommission.gov.uk under ‘Decisions of the Commissioners’.