Opinion

Fundraising review and regulation

15th August 2017

Fundraising review and regulation

Prompted by concerns raised in the media about the tactics charities use, a fundraising review was conducted to look at self-regulation and changes introduced. Recommendations aimed at restoring public confidence saw the creation of a new fundraising regulator which inherited the responsibilities of the Fundraising Standards Board.

New controls were introduced through the Charities (Protection and Social Investment) Act 2016 including new terms to be added into the agreements between charities and professional fundraisers. Under such an agreement, details must be provided of how commercial organisations will protect vulnerable people and others from unreasonable intrusion, unreasonably persistent fundraising and undue pressure to donate. Arrangements will also need to be made to enable the charity to monitor compliance.

Charities were expected to update existing agreements by April 1 2017, while an FAQ document issued by the Fundraising Regulator and the Charity Commission states that pre-November 2016 agreements are also subject to the new requirements.

A failure to comply could affect the ability of a professional fundraiser to enforce the agreement and could mean that the charity is in breach of the Code of Fundraising Practice.

The Fundraising Regulator will also operate the Fundraising Preference Service. This will allow people to specify which charities they no longer want to hear from and let individuals register a desire not to be contacted by charities with any form of solicitation.

The regulator has also sent out letters regarding the levies that apply to all charities that spend more than £100,000 a year on fundraising. The levy is expected to collect around £2.5million a year to be used to set standards, adjudicate complaints and develop the Fundraising Preference Service. However, while the new system is voluntary, the Fundraising Regulator expects charities to pay and the Government has given itself reserve powers to enforce payment.

If accounts are audited, a statement in the Trustees Annual Report must look at a charity’s approach to fundraising. In particular, whether professional fundraisers or commercial participators are used and give details of any voluntary fundraising schemes or standards which a charity or anyone fundraising on its behalf has agreed to and any failure to comply.

A charity must disclose whether and how it monitors fundraising activities carried out on its behalf and how many complaints the charity or anyone acting on its behalf has received. It must also disclose what the charity has done to protect vulnerable people.

Complaints will be dealt with on a reactive basis and there are three stages depending on the severity, including an investigation by the Fundraising Regulator and adjudication.

Consultation has now finished on the Code of Fundraising Practice and a response is due imminently.

With the spotlight focused on self-regulation and a tightening of fundraising practices, our team can offer advice and guidance on these new procedures and review existing fundraising practices and documents used.

 

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