The Charity Commission has opened a consultation on the questions it plans to ask on the 2018 version of the annual return, including controversial new questions on overseas funding sources and salaries.
In a press statement the Commission said it wants the next iteration of the annual return to be “more dynamic” that is new questions are intended to “strengthen the sector’s accountability”.
Proposed changes include new sections on senior executive pay and on overseas funding sources and additions to sections about fundraising and payments to trustees.
The Commission plans to move questions about other regulators the charity reports to, the number of volunteers, whether the charity is registered for gift aid, and policies the charity has a new "update charity details" service.
Salaries
The section on employee salaries includes a direct question about the exact salary of the chief executive.
The Commission proposes to ask if any staff earn over £60,000 and which income brackets they fall into. Charities already have to report this in their annual accounts.
Following a number of media stories about charity chief executive pay in 2013 NCVO produced a report recommending that charities make details of senior pay easily available on their website.
Overseas funding
Questions about overseas funding sources had been widely anticipated after the Home Secretary, Amber Rudd announced that the Commission would begin collecting this information as part of plans to combat terrorism.
The Charity Finance Group expressed concern about the policy and the Commission said it would not introduce the question without consulting.
The Commission proposes to ask three questions about overseas funding, including requiring charities to break down the types of funding by country, though it plans to offer a “unknown/don’t know” option.
Other changes
The Commission has also added an extra question to its section on fundraising about whether charities use professional fundraisers.
It has also expanded the section on trustee payment. In 2016 and 2017 the Commission had asked if one or more trustees were paid for acting as a trustee.
The Commission now proposes to also ask if any trustees were paid for providing professional advice, received other benefits and if any employees are former trustees.
‘Window for the public’
Helen Stephenson, chief executive of the Charity Commission, said: “The annual return is an essential regulatory tool for the Commission, but also a window for the public to see important information about charities. Ensuring that we are collecting the right information, in a way that is simple for charities to understand, is absolutely vital.
“We believe the changes that are proposed will help strengthen our ability to regulate charities and improve public trust and confidence. The improved digital service being offered will also result in a much easier service to use that is based on the needs of charities. The voice of charities and their umbrella bodies will be important to inform our approach and we look forward to engaging widely and constructively in the coming weeks.”
The Charity Finance Group said that changes must not make the annual return overly burdensome.
Andrew O’Brien, head of policy and engagement at the Charity Finance Group, said: “We welcome the Charity Commission’s decision to listen to the sector’s concerns about changes to the annual return and open a full three-month consultation.
“We believe that the Commission needs to have the information it needs to do its job properly, but we must make sure that this doesn’t lead to any unnecessary administrative burden for charities. It is also important that changes made to annual return are accompanied with appropriate guidance and support for charities to answer them effectively. We will be scrutinising these proposals very closely and giving a full response on behalf of charities.”
The deadline to respond to the consultation is 5pm on Friday 24 November.
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