The Attorney General announced today that he will seek to close down one of the richest charities in the UK, and spend its £475m assets on paying off the national debt.
But Steve Reed, the shadow minister for civil society - whose questions in parliament prompted the move - has said the money should go to the sector instead.
The National Fund was set up with £500,000 in 1928, by an anonymous donor – believed to be Stanley Baldwin, who later became prime minister – with the intention of paying off the national debt.
The charity has never spent a penny on charitable activity but has just accumulated assets for 90 years, growing in size to £475m.
This makes it one of the 25 richest charities in the UK, but still less than a tenth of 1 per cent of the national debt, which is currently £1.6 trillion.
In 2009 the fund's sole corporate trustee acknowledged that it would never accumulate enough capital to pay off the national debt, and sought permission from the Charity Commission to close down. The matter was referred to the Attorney General's Office but stalled there for seven years without any decision being made.
Earlier this year Civil Society News discovered that the process of closing the fund had stalled, and sought clarity from the AGO on when a decision would be made.
Civil Society News articles on the subject were picked up by Steve Reed, who asked questions in the Commons. These led the Attorney General to announce he would take action, and he has today said he will seek permission from the courts to wind up the fund.
“Almost 90 years ago an anonymous donor bequeathed money to the nation and yet we have not been able to put it to good use,” Wright said in a statement today.
“We have been working with the Treasury, trustees and the Charity Commission to find a solution consistent with the donor’s original objectives of extinguishing the national debt.
“I am applying to the High Court to ask that the fund is released and if that application is successful, the fund could be used to benefit the nation, by helping to do what the original donors intended.”
Reed, however, said he believed the money should go to the charity sector.
“This £475m would be a tidal wave of support for small charities, but it’s a drop in the ocean compared to the national debt," he said. "In fact, the national debt is rising so fast that by the end of the same day this payment is made towards it, the debt will have risen by nearly the same amount.
“This government never misses a chance to sideline charities. Here’s a real chance to do some real good but the government is threatening to do nothing instead.”
Read the full story of how the National Fund has been trying to close for almost a decade here.
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