CABINET OFFICE News
Release (CAB/042/08) issued by The Government News Network on 1
April 2008
Phil Hope,
Minister for the Third Sector, has today made the fourth
commencement order of the Charities Act 2006. It includes the new
statutory definition of 'charity' and various accounting
and reporting changes to bring the legal framework for charities
up to date. Other changes to charity law, including a requirement
for professional fundraisers to state how much they are paid when
asking for public donations, also come in today.
Phil Hope, Minister for the Third Sector said:
'The Government is continuing to support charities build on
their proud history of tackling injustice and driving change in
our society. Of course, as society has progressed so too have
charities. The new legal definition of charity, and the public
benefit requirement, will give charities the platform to explain
their good work and help the public see their true value.'
The main changes in the fourth commencement order are:
* A new statutory definition of 'charity' - to be a
charity in England and Wales an organisation must have purposes
that are exclusively 'charitable' and those purposes
must be for the public benefit.
* The Charities Act includes a list of headings of charitable
purposes. The list consists of 11 specific headings followed by
one general heading. The 12 headings together cover everything
that is charitable.
* A requirement for all charities to show public benefit
-charities must also demonstrate that they exist for the public
benefit. Previously, charities with purposes of poverty relief,
education or religion were presumed to be for the public benefit.
From today, they - like all other charities - will have to
demonstrate their public benefit which will help people see the
good they do.
* New accounting and audit procedures - it is important to be
able to understand the full range of activities and resources
controlled by a charity not only directly but indirectly through
subsidiaries. It is already sector practice to prepare group
accounts where a charity undertakes activities through
subsidiaries. The Charities Act 2006 makes it a legal requirement.
Also coming into force today are other provisions of the
Charities Act 2006:
* Fundraising Statements - from today professional fundraisers,
who are paid to fundraise for charities will have to disclose the
amount they are being paid when asking for donations. This is part
of a wider package of reforms that will support transparency in
professional fundraising, enabling it to continue as an important
means of generating income for charities.
Notes to Editors
1. The Charities Act 2006 is often cited as the biggest shake up
of charity law for four hundred years. For further information on
its provisions and implementation please see: Charities Act Implementation
2. The Office of the Third Sector (OTS) in May 2006 to drive
forward the Government's role in supporting a thriving third
sector, and join up sector related work across government. The OTS
has produced draft guidance to help professional fundraisers
comply with the new requirements see:
3. Guidance for charities on how to demonstrate their public
benefit has been produced by the Charity Commission. For further
information please see: Charity Commission
Cabinet Office Press Office 22 Whitehall LONDON SW1A 2WH
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