Charities Bill [HL]
Lord Hodgson of Astley Abbotts (Spokespersons In the Lords, (Assisted By Shadow Law Officers); Conservative)
My Lords, my noble friend has brought to our attention an important point. It has obviously caused a lot of concern in the sector; witness the postbag that those of us involved in the Bill have received.
I have some concerns about the way in which the amendment is phrased and the background to it. My concerns are twofold. The first is the read-across from the private corporate sector, where a company that goes into administration or receivership has to pay the costs of that receiver or administrator, and there is no charge to the Department of Trade and Industry. Moving the payment from the company that is in difficulty—or the charity, as in my noble friend's example—to the taxpayer seems to raise a difficult issue. The reason is that, if we are not careful, we end up with what might in effect be a subsidy for bad behaviour. If a charity is so badly run that a receiver or manager is appointed, why should the taxpayer, who is after all the funder of the Charity Commission, pick up the bill? A possible subtext is that there is a small, probably marginal, incentive for trustees to behave well, in that, if they behave badly and an administrator or receiver is appointed, there will be a penalty attached to their bad behaviour. Those are my two problems with what my noble friend has put before us this afternoon.
On the other hand, there is no doubt that there is an obligation on the receiver and manager to operate efficiently and on the Charity Commission to ensure that it is operating efficiently. My noble friend has given some examples of cases where the administrator, receiver or manager has been in the post for several years, where the sums involved have been very large. That is an important issue that needs to be addressed, although I am not sure that the way that my noble friend suggests is the right one. It is, the Minister will know, a frequent complaint about the behaviour of receivers and managers in the private sector that they are cavalier with their time and therefore cavalier with the funds of the company that they are managing or administering. Redress is not easy to obtain, because a company in administration or receivership has no capacity to fight the administrator or manager, because it is obviously on the back foot.
My noble friend has raised an important issue about how the Charity Commission is going to behave and the way in which future managers and receivers should behave to ensure that they are efficient and timely in their work. I look forward to hearing how the Government believe that that important balance will be struck.