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The bill would make a number of technical changes to charities law. The Law Commission published its report recommending changes to charities law in 2017. It said that uncertainties in the law and unnecessary regulation can disrupt charities’ activities, discourage participation and force charities to obtain expensive legal advice. It hoped its recommendations would simplify the regulation of charities, while still maintaining important safeguards for how they are run.

The Government welcomed the Law Commission’s report and accepted 36 out of the 43 recommendations. It agreed that, although the changes could seem highly technical, they would make it simpler and easier for charities to respond to opportunities to achieve their purposes. The rejected proposals included a review of the basis to challenge Charity Commission decisions and a proposal to abolish the requirement for charities to advertise proposed disposals of designated land.

The bill includes changes to simplify the law around: 

  • changes to a charity’s governing documents;
  • payments to trustees in certain circumstances for goods and services provided;
  • using funds for ex gratia payments or using funds obtained in connection to specific fundraising campaigns for other purposes (cy-près powers);
  • utilising permanent endowments; and
  • disposals of charity land.

Labour has indicated its support for the bill. The Law Commission also said that the Law Commission proposals had received support from the Charity Commission and the charity sector itself. The National Council for Voluntary Organisations has recently welcomed the bill, stating that it is a positive step to simplify the law.

This briefing was updated on 29 June 2021 to include the date it is scheduled to be considered in second reading committee in the House of Lords.

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