Mr. Ivan Cooper:

I would like to tie a few of those contributions together. We fully support regulation in the public interest, and have no issue with regulation per se, but it is all about the nature and approach of the regulation. The regulator has an obligation and its primary objective is to increase public trust and confidence in charities. That requires a balance. There is an element of holding to account and setting and ensuring standards, and that is what this hard piece is about in relation to the legislation, but there is a piece to which the Chair has alluded in relation to supporting organisations. That is very important as a component. There is also a worry that in the background to the proposals we have on the table here, there might be a sense of the cliché that hard cases make bad law. Therefore, what is going on here, although unsaid, is that the regulator is making up for the fact that it perhaps felt it did not have sufficient power at a specific point to deal with a handful of hard cases that are unlikely to occur in any kind of similar way again, especially as the sector has been culturally adjusting to the standards that are now there in relation to charity regulation and governance. It would appear that the balance in this draft legislation is wrong at the moment. There is too much emphasis on giving the regulator more powers. It is almost like the regulator will become ever present in the mind of trustees when going about their daily business, to an extent that will cause worry and fear, and a reluctance to become involved. We just need to be really careful in relation to how we move from here.

The Cathaoirleach captured it very well. We do not believe there is anything that fundamentally prevents the regulator from taking a more supportive approach, if that is what it chooses to do, and we would encourage it to do so. Ms Murphy mentioned a debate when the original charities Act came in as to whether the regulator would be a policeman or a pal. However, being either completely will not work. The art of the regulator is to be both policeman and pal. We think it is possible in relation to this draft legislation to make the amendments we are suggesting to get a better balance. Legislation or law determines culture. Culture can often result from that. Structures and processes determine the way we do things around here so it is really important that we get that right.

I will make a final observation. There is this reality that applies across other regulatory regimes, where authorities and powers attempt to shift risk away from themselves in all circumstances. It is a process of general risk shifting. I am sure members are all aware of difficulties in the insurance market at the moment and the problems many organisations are having finding insurance. It is the same culture of risk shifting that prevails. How that manifests fundamentally is that if regulators are unwilling to share a degree of the risk on behalf of the sectors they are regulating, then services are removed or disappear. Fundamentally, it is individuals, families and members of communities who are reliant and depend on the services provided by charities governed by trustees who will suffer if we find people walking away and if charities have to invest disproportionate amounts of times and energy in over-focusing on eliminating risk, which cannot be done. We all know that risks cannot be eliminated. We need to have a risk appetite, and trustees cannot be punished for determining that there are risks that they wish to take, which they do not have to report as significant potential events to the regulator.