Clause 40
Charities Bill [Lords]
5:15 pm
Edward Miliband (Parliamentary Under-Secretary, Cabinet Office; Doncaster North, Labour)
I am grateful to the hon. Member for Isle of Wight for tabling his amendment and I shall try as best I can to explain the clause—although, as a health warning, I should say that it is not easy to explain.
My key response is to suggest that new section 74A of the 1993 Act must be taken with new section 74B. In other words, for the property to be transferred, the charity trustees of the transferor charity must be satisfied that that would further the purposes for which the property is held. In other words, the trustees must believe that the transfer will further and transfer the purposes for which the gift or the assets were originally put.
I can best explain the effect of the amendment in the following way. Suppose, for the sake of argument, a charity had purposes A, B and C and thought about transferring property to one that had purposes B, D and F. Under the clause as it stands, the first charity could decide to transfer the property or asset to the second charity because it had purpose B. The second charity would not share all the first charity’s purposes, but the two would have a purpose in common.
If the amendment were made, the transfer would not be possible because the purposes of the charity to which transfer was to take place would not be substantially similar to the purposes of the transferring charity or any of the purposes, because purposes B, D and F of the second charity would not be the same as A, B and C, or as A or B or C. That explanation is incredibly convoluted, but it is the best that I can do. I give way to the hon. Member for Cheltenham, who I hope will simplify the explanation.