Noel Ahern (Dublin North West, Fianna Fail)

The Government decided it was unacceptable to continue to have a completely unregulated charities sector. In the programme for Government we undertook to enact a comprehensive reform of the law relating to charities to ensure accountability and to protect against abuse of charitable status and fraud.

Some areas of charitable fund-raising are particularly vulnerable to abuse under the current system. For example, modern methods such as selling tokens like flowers and lapel pins, or collecting promises of money such as standing orders or direct debits, do not need a permit from the Garda. The lack of regulation to date has meant that there is no reliable information on the number of active charities, their financial worth and how they spend their funds. Moreover, there is no requirement to show where donations come from, how much money was received, or what it was spent on; there is no legal obligation to spend donations on the charitable purpose for which they were collected; and there is no requirement to show what percentage of donations was spent on, for example, administration, advertising, professional fund-raisers etc.

These are just some examples of the kind of issues that will need to be tackled by the regulatory body to be established under the legislation which my Department will now prepare. A statutory body to regulate charities will specifically aim to supervise charities and subject them to full regulatory scrutiny. I intend there to be a requirement for charities to provide regular accounts to this body to ensure public accountability. This body will regulate and monitor charities, including their charitable fund-raising activities, on an ongoing basis, and it will protect the public interest by monitoring and investigating possible abuses, including in regard to charitable fund-raising activities.

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The body will also be tasked with issuing performance reports on areas of the charities sector and I would expect matters such as the publication of league tables to come under this aspect of its responsibilities.

Informed, vigilant trustees also have a crucially-important role to play in guarding against fraud or abuse. I am pleased to report, in that regard, that the Law Reform Commission has been engaged to assist and advise my Department on the updating of charitable trust law, which will form an integral part of the draft charities regulation Bill. This specialist area of the reform will be the subject of a separate public consultation, under the aegis of the Law Reform Commission, in December 2004. At this stage, the current best estimate for publication of the Bill is end 2005. This is a hugely ambitious goal, as the legislation is likely to run to about 200 sections and numerous schedules.

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