Third Sector magazine is running a story: ‘Charity Commission takes a stand on NHS charities’ accounts’. It seems that a few people in NHS management and senior advisors in the Department of Health have scant regard for the autonomy of charities and for their requirements to hold charitable funds in trust. Yet again there seems little respect for the position of charities working alongside and within the NHS.
According to Third Sector, the Charity Commission appears to be heading for a showdown with the DH over accounting procedures for NHS charities in England and Wales. DH seems to have told health authorities that any NHS body that is the sole trustee of a charity must move that charity’s assets onto its own balance sheet.
This seems to rely on a recently introduced international public accounting standard that says public sector bodies must consolidate the accounts of any organisations they control (above a certain level). The DH estimates this to be about 30 of the 282 NHS charities that have NHS bodies as sole corporate trustees.
Up with this the Charity Commission will not put. And rightly so. The Charity Commission (a government department and the statutory Regulator for Charities, by the way) will be writing to health authorities telling them it is “wholly inappropriate” that charitable funds should ever appear on the balance sheets of public sector organisations, because it gives the impression that charitable assets are controlled by government.
And before anyone protests that these are the NHS’s funds – they are not. Charitable funds remain charitable in perpetuity – and as we used to say when I was at the Charity Commission, that’s a very long time. And if you don’t own the funds you shouldn’t consolidate them. They would not belong to the health authority if, for any reason, it was wound up.
The Association of NHS Charities, which represents the largest hospital charities, has said it it‘s opposed to the DH’s decision. It’s clear that the clash between the Charity Commission and the Department of Health will put corporate trustees in a very difficult position.
Only last week I wrote that if the NHS wishes to work in partnership with voluntary organisations they must respect their independent role within and alongside health services. That was in the context of commissioning services from the Third Sector where, as Andy Burnham said, he wished to protect the best of the NHS but made it clear that the NHS won’t become great alone. It needs the voluntary sector. And for the DH to suggest that the NHS can take over charitable funds seems rather more of an asset grab rather than the action of a mature and confident partner.