Ms Helen Martin:

The Charities Regulator welcomes the opportunity provided by this committee to provide submissions to it on the general scheme of the Charities (Amendment) Bill 2022, which seeks to enhance and strengthen the existing framework for regulating charities in Ireland. As acknowledged by other witnesses, the Charities Regulator is a relatively young organisation. However, since our establishment in October 2014, we have gained extensive experience of implementing the Charities Acts. Through our work, we have identified a number of areas where statutory amendments would enable the Charities Regulator to carry out its functions more effectively. The amendments proposed in the scheme will facilitate greater accountability and transparency, which are vital for public trust and confidence in the charity sector. They will also further support a balanced and proportionate approach to regulation by expanding what is currently a relatively limited range of regulatory tools.

Ireland’s charity sector of almost 11,500 registered charities plays a pivotal role across every facet of society. The public and the State rely on registered charities and the tireless work of hundreds of thousands of volunteers across Ireland, over 75,000 of whom take on considerable legal responsibilities as charity trustees.

We are cognisant of the profile of the sector we regulate and its importance in communities. As our 2021 annual report highlights, the sector comprises a diverse range of organisations, from the simple to the complex and from those with little income and limited operations to those with substantial resources and extensive operations.

The majority of charities and charity trustees work hard towards achieving their charitable purpose in compliance with the Charities Act 2009. Our regulatory approach reflects this and is balanced and proportionate. This is evidenced by the fact that a substantial part of our work is focused on promoting compliance and supporting charities in achieving it.

Our work includes daily engagement with individual applicants for registration to guide them through the registration process and with registered charities to ensure they understand the statutory reporting requirements and standards of governance as set out in the charities governance code.

While the public is the single biggest source of the concerns we receive regarding charities, only a small proportion of the engagement we undertake with charities and charity trustees is visible to the wider public due to the small number of cases where we have had to appoint inspectors or take other formal action. The majority of our compliance engagement is directed towards assisting individual charities to come into compliance and meet their regulatory obligations. It is only when we are not assured by that engagement that, for example, inspectors are appointed.

The Charities Regulator has been seeking amendments to the Charities Acts for a number of years to address certain fundamental and practical issues regarding the application of those Acts. There are a few key provisions in the general scheme that I would like to highlight today. Fairness is essential for effective regulation. We are seeking amendments that are intended to ensure all registered charities, regardless of their legal form, are subject to the same regulatory framework, particularly in relation to the preparation and filing of financial statements. Clarity on legal obligations is also essential. Given our experience to date in the area of compliance and the work we continue to carry out to support and encourage better governance standards in the sector overall, we view the proposed amendment clarifying the fundamental responsibilities of charity trustees as essential. As previous witnesses have acknowledged, there is nothing new here and the amendment merely codifies what is already the case and provided for in law.

While we are committed to a balanced and proportionate regulatory approach, we are limited by the type of powers currently provided for under the 2009 Act. Sometimes the only option open to us is more far reaching and heavy handed than a breach merits. Therefore, we are also seeking the expansion of the circumstances in which the regulator can impose intermediate sanctions as an alternative to prosecution. This is not an extension of our powers per se but more a modification of the range of powers already available to us under the 2009 Act. An important point to highlight here is the significant role of the independent Charity Appeals Tribunal, the statutory body established under the 2009 Act to hear and adjudicate on appeals against certain decisions of the Charities Regulator. A charity’s right to natural justice, including the right to appeal a decision of the Charities Regulator, should be fully respected in the proposed amendments.

We would also like to briefly mention the proposed amendment set out in head 5(a) which has been referenced by previous witnesses. The amendment is intended to clarify that where a suspected offence under the Charities Act is subject to investigation and potential prosecution by the Charities Regulator, we are not obliged to notify those offences to other investigative authorities. However, the Charities Regulator will still be required to notify the appropriate authorities when we suspect that an offence under their legislation has been committed. The amendment, if enacted, will not affect other obligations under the Act governing our relationships with investigating authorities and other regulators.

Finally, there are amendments intended to address practical difficulties encountered in day-to-day operations. These amendments relate particularly to the withdrawal of applications for registration and the obligation on charities to notify the Charities Regulator if they are seeking to amend key provisions in their governing document, such as their main object and income and property clauses. This provides an important safeguard for charities themselves. It ensures that changes are not made to their governing documents that could unintentionally negatively impact their status as registered charities. Ensuring that key information crucial to an organisation’s charitable status is known to the regulator and is kept up-to-date on the register of charities is vital. The public needs to know that when they donate money, goods or time to a charity, those valuable resources will only be used for their intended purpose.

Our core function is to work to increase public trust and confidence which are the bedrock of the charity sector. We are committed to achieving this, working with all of our stakeholders. The amendments we are seeking are designed to assist with this work and, if enacted, will further strengthen and enhance our ability to deliver a balanced and proportionate approach to the regulation of Ireland’s valuable charity sector.