Jersey’s new Charity Commissioner, John Mills CBE, was appointed in July. Since then he has been developing plans for the Island’s public register of charities, to be set up under the Charities Law enacted in 2014 by the States. He has been meeting with a wide range of people in the charity sector and finance industry to hear their views about the new regulatory regime. This important process of engagement continues.
Mr Mills’ main initial task is to prepare statutory guidance on the operation of the new law and in particular on the ‘charity test’ that will govern how organisations may become Jersey registered charities. From 2019, being a registered charity will be the only means by which an entity now describing itself thus will be entitled to continue doing that, and, subject to some transitional provisions , continue to obtain all the tax reliefs currently afforded to charities.
The charity register will contain key information about each charity and, with some limited exceptions, will be fully open to public inspection so that people can if they wish understand more about the purposes, finances and public benefit delivery of the charities that they may wish to support.
Speaking today to voluntary sector representatives at a roundtable discussion organised by the Jersey Policy Forum, Mr Mills said:
“I have been very encouraged by the support I have seen from all quarters for the new charity register and the regulatory arrangements that will encompass it. The new Charities Law is a significant reform concerning a very important sphere of civil society in Jersey. When the new arrangements are bedded in, I am confident they will serve to help achieve the purpose set in the Law of increasing public trust and confidence in our charity sector as a whole.
There is still some work to do to put in place various orders and regulations upon which the operation of the register will depend. An excellent group of officials is on the case and I am also keeping in touch with Assistant Chief Minister Senator Routier, who has political oversight of the project. A website is also under development and work in hand to establish the tribunal provided for in the Law to hear appeals against my registration decisions. In short things are all moving ahead well.
My aim is to publish immediately after the Christmas break a consultation draft of the statutory guidance on the charity test. This will address how I shall approach decision-making on applications for registration and set out the main principles and factors that will need to be brought to bear in my interpreting various provisions of the law. I shall follow this up in early 2018 with further consultation on other guidance that I am required to prepare – notably on the applications process for registration itself and the precise information, including financial information that will be required, the duties of governors, and procedure for annual returns from 2019.
My aim is that the Jersey charity register will be open for business from May 2018. It is important to note that there will be no impact on the current tax reliefs enjoyed by any charity in the short term provided that it has applied for registration by the end of 2018 even if that registration has not been determined by the end of the year. Subject to that, such an organisation’s continuing entitlement to preferential tax arrangements will depend upon whether or not it has successfully become a registered charity, which I shall have certified to the Comptroller of Taxes.
To aid the consultation process, early in the New Year I shall be arranging several meetings and ‘drop-ins’ where people, especially those involved with organisations that will seek to become registered charities, can hear about the operation of the new law and ask whatever questions they wish. There will also be an advisory service to assist with the applications process.
The heart of the matter will be that, in order to become a registered charity, an applicant organisation will have to satisfy the Commissioner
- first, that it has purposes drawn from its written constitution that are charitable purposes as defined in the Law, and does not have other, non-charitable, purposes save where those would be purely ancillary or incidental
- and, secondly, how it intends to provide public benefit in giving effect to its charitable purposes.
This ought not to be hard but it may well warrant current charities, both large and small, taking stock now of how they are set up and run, and whether they do actually do what their founding documents say they should; and that they don’t do other, non-charitable, things save in a purely incidental manner.
I shall be producing a model constitution that could be used or drawn upon by organisations seeking registration but which are currently unincorporated. The applications process guidance will enlarge on this.
I should add that applicants’ statements of charitable purpose and public benefit will first have to be submitted in draft; once those are approved, pursuant to the Law and the guidance, the applicant will be registered as a charity and those statements, along with financial and other key information, placed on the register. The charity will then be required to submit an annual return so that the register remains up to date and I am able to remain satisfied that it, the charity, continues to justify registration. In many if not most cases, this process should be straightforward but there will no doubt be some instances where it might not be. Hence the central importance of the guidance, to which everyone involved will be required to have regard.”
Notes for Editors
- A small physical office for the Charity Commissioner will be established in January 2018. The planned website is still under development. If anyone involved with an organisation who is thinking of or planning to seek its registration as a Jersey charity wishes to contact Mr Mills, he or she is invited to do so via a temporary email address: email@example.com. He may also be contacted through Richard Jouault Esq, of the Community and Constitutional Affairs Department, whose email address is firstname.lastname@example.org and telephone number 447937. Mr Jouault is the senior official responsible for the implementation of the Charities Law.
- The office of Jersey Charity Commissioner is established as a corporation sole by Article 3 of the Charities (Jersey) Law 2014.
- The main general functions of the Commissioner are to:
(i) administer the charity test and operate the charity register as established by the Law
(ii) encourage, facilitate and monitor compliance of registered charities and their governors with the Law
(iii) publish and maintain guidance on the operation of the Law
(iv) do the above as far as practicable in a manner that is proportionate as to the burdens imposed on registered charities but which also serves to protect public trust and confidence in registered charities and is compatible with the encouragement of all forms of charitable giving.
- The Law follows not dissimilar reform of the law of charity a decade ago in England and Wales, and, separately, in Scotland. The charity test element of the Jersey Law is akin to the approach taken in Scotland in requiring a demonstration of public benefit ‘activity’ in giving effect to charitable purposes; it is not exactly the same as the approach taken in England and Wales where charitable status relies on an organisation’s having purposes that are for public benefit, although the underlying concepts of charity and benefit are essentially the same.
- Full details of the Charities (Jersey) Law 2014 can be found on the States Assembly website by searching for Proposition P.108/2014. The draft Law set out there was passed by the States without amendment. The version of the Law on the Jersey Law website currently excludes those parts of it which are not yet in force.
- At the Law’s heart is a requirement that, for an organisation to be a registered charity, it must have a charitable purpose or purposes as defined in the Law and must also, in effecting those purposes, provide public benefit to a reasonable degree. Any other purposes must be purely incidental or ancillary. There is an explicit presumption that no purpose is for public benefit; the matter must be demonstrated. This is the ‘charity test’ which an organisation will have to meet in order to become a Jersey registered charity. From 2019, (subject to some transitional rules for existing charities approved by the Comptroller of Taxes) only registered charities will be entitled to all the tax reliefs currently available to those bodies designated as ‘charities’, and to style themselves as a Jersey charity.
- There will be no charge for registration.
- The full requirements for the ‘charity test’ will be set out in the Commissioner’s guidance.
- The charity register will be public and accessible to all without charge. This is save for a restricted section for privately-funded charities that meet a requirement under the Law (to be established in detail in forthcoming regulations) that they neither solicit nor receive donations from the general public. Such bodies will, however, will equally have to meet the charity test in order to be registered and be subject to the Commissioner’s oversight in exactly the same manner as charities on the public register.
- There are 16 charitable purposes set out in the law, some of which have some additional explanatory words. In summary, they are:
(i) the prevention or relief of poverty
(ii) the advancement of education
(iii) the advancement of religion for the purposes of Purpose 16 below, advancement of any philosophical belief (whether or not involving belief in a god) is analogous to this purpose
(iv) the advancement of health this includes prevention or relief of sickness, disease or human suffering
(v) the saving of lives
(vi) the advancement of citizenship or community development this includes (i) rural or urban regeneration and (ii) the promotion of civic responsibility, volunteering, the voluntary sector or the effectiveness or efficiency of registered charities
(vii) the advancement of the arts, heritage, culture or science
(viii) the advancement of public participation in sport in this purpose ‘sport’ means sport that involves physical skill and exertion
(ix) the provision of recreational facilities or the organisation of such activities, with the object of improving the conditions of life for the persons for whom the facilities or activities are primarily intended this purpose applies only in relation to recreational facilities or activities that are (i) primarily intended for persons who have need of them by reason of their age, ill-health, disability, financial hardship or other disadvantage; or (ii), available to members of the public at large or to male and female members of the public at large
(x) the advancement of human rights, conflict resolution or reconciliation
(xi) the promotion of religious or racial harmony
(xii) the promotion of equality or diversity
(xiii) the advancement of environmental protection or improvement
(xiv) the relief of those in need by reason of age, ill-health, disability, financial hardship or other disadvantage this includes relief given by the provision of accommodation or care
(xv) the advancement of animal welfare
(xvi) any other purpose that may reasonably be regarded as analogous to any of the purposes listed above