Remaining silent on the 'charity' status

THE narrowboatworld article 'Canal & River Trust is not a charity' has caused much comment on social media.

Perhaps understandably, Defra, CaRT and the Charity Commission have remained silent on the matter.

Allan Richards provides an update.

The issue

From the Charity Commission guidance on independence of charities:

"If a governmental authority could exercise a power in the administration of a body for its own benefit, the body in question would not be a charity, since it would exist in part for the benefit of the governmental authority."

From the Office of National Statistics  (ONS):

"... The Canal & River Trust is judged to be under government control in particular through the provisions of enabling instruments whereby the Secretary of State for the Environment and Rural Affairs has the power to approve or deny certain corporate decisions (e.g. dissolution). The Canal & River Trust is therefore classified as a public non-financial corporation ....”

Charity Commission

In the case of CaRT, the Charity Commission is both registrar and regulator. The commission has a statutory function to determine whether an applicant is eligible for entry on the register of charities.

Conversely, under section 34(1) of the Charities Act 2011, the Charity Commission must remove from the register any institution which it no longer considers is a charity.

This can be because the charity has been dissolved or the trustees have requested removal. It can also be because the charity should not have been registered due to incorrect information being supplied or an error on the part of the commission.

Contrary to its own guidance, the Charity Commission registered CaRT (a private company, limited by guarantee) on 4th April 2012.

…. and commission can’t say that it was not warned that ONS might take a different view. From a complaint made a year after registration that CaRT was under government control:

“One may reach the situation in which CRT is re-classified as 'a Central Government body' in 'National Accounts, Public Sector Finances and EDP {Maastrichi Excessive Deficit Procedure}' figures 6.

In the light thereof it may be difficult to contend that CRT is independent from the State in whose accounts it will be included.”

ONS re-classified CaRT as a public non-financial corporation because it was deemed under government control from 2nd July 2012—the day that British Waterways functions and assets were transferred to it.

Complaints

Based on the above, a complaint has been made to the Charity Commission. It asks them to review the decision to register CaRT. The complaint was made on 26th February and has been acknowledged but no response received as yet.

Having received advice that CaRT were aware of the ONS classification and obliged to report it under charitable law, a further complaint was made on 2nd March. Under Charity Commission rules this has initially been made to CaRT.

Contrary to CaRT’s own complaints procedure, this has not yet been acknowledged.