Funding news

OSCR to implement review of charity register - Thursday 28 September 2006

The Office of the Scottish Charity Regulator (OSCR), which assumed its full powers in April of this year, has recently announced a full-scale review of the country’s 21,500 existing charities.

The Rolling Review, intended to start in June 2007, will implement the new Charity Test as established by the Charities and Trustee Investment (Scotland) Act 2005, the first piece of legislation put forth by the Scottish Parliament dealing specifically with governing the charity sector.

“…All [charities] will be reviewed and some will undoubtedly be pushed off [the register], otherwise what’s the point,” said Lucy McTernan, director of corporate affairs for the Scottish Council for Volunteer Organisations (SCVO). “Hopefully it will encourage charities to do what the public wants them to do, which is to be for the public benefit. Hopefully charities will step up to the mark and… they should be encouraged to operate within an effective system.”

She added that the SCVO welcomed the Review. “Its part and parcel of a comprehensive charity regulator, which is something we’ve been asking for for some years now,” she said.

Mark Simpson of OSCR said that the general response from the sector has been mostly positive, something that was not unexpected. “OSCR has a track record of communication with the sector and it was expected that at some point we would propose how exactly we plan on carrying out our regulator functions,” he said.

The process of the Review will take an estimated seven years, during which all charities on the register will be scrutinised by OSCR. Charities that have questionable public benefit, restrictive fees, or activity in non-charitable work are those that will be looked at first, identified as having “risk / uncertainty criteria.”

“We have established the uncertainty criteria as to whether [charities] will meet the new charity tests, but how many of those would be at risk is hard to say,” said Marieke Dwarshuis, head of charities at OSCR. “We will look at them and it might be rather straightforward for them to make a change.”

If a charity is unable to make a change or meet the specification of the test, it would loose its charitable status, considered “a significant loss to its brand,” according to Dwarshuis. “It might mean a loss to fundraising, or rates release on buildings that it occupies, or any tax relief offered to it, but that’s a judgement to the Inland Revenue and Customs rather than OSCR,” she said.

After the first seven years the public register will be updated with all charities to have passed the OSCR test. The review will continue, however, as an ongoing process, ensuring that the register is populated only by those charities found to be valid.

“Our objective as a regulator is to create a regulated environment where charities can flourish and public trust is reinforced. The Rolling Review is obviously a part of that,” said Mark Simpson of OSCR.

Source: http://www.charitytimes.com