Charities Warned of Crypto Donations.
The Charity Commission has updated its CC8 guidance to reflect the rise of digital payments and cryptocurrency donations.
The updated guidance sets out the role strong internal financials controls can play in ensuring trustees can safeguard their charity’s assets and use them properly.
It now features sections on mobile payment systems, such as Google Pay and Apple Pay, donations of crypto assets and an updated checklist to help trustees review internal financial controls.
The Commission also refreshed current advice on risks when holding public collections and fundraising events, making payments to related parties and operating overseas.
The Commission said the updated guidance is “more concise, clearer and covers issues that were not in existence or widely relevant to the sector” when first published in 2012.
On mobile payment systems, it said that trustees “should have the same controls in place as for payment by debit, credit or charge cards.”
Charities should stipulate in their policy on donations whether they accept donations of crypto assets and how these are dealt with.
It warned charities of the risks associated with crypto assets such as the volatility of their value and the lack of protection compared with traditional currencies or financial products.
Trustees have “a legal duty to manage your charity’s resources responsibly, including by implementing appropriate financial controls and managing risk,” the guidance said.
“Understand the risks of holding, and the limitations of using, crypto assets before you accept donations of them. You should be certain you have the expertise to manage these risks carefully. If you hold any crypto assets, you should be prepared for them to lose their value.”
Do not ‘weaponise’ the Charity Commission in Trustee Disputes
The Charity Commission has told trustees not to “weaponise” the regulator in internal charity disputes.
Helen Stephenson said she sees too many cases that revolve around “two or more warring parties with differing visions for the future of the charity.”
“Do not try to weaponise the Commission as a tactic in a quarrel with fellow trustees, and do not assume that by coming to the Commission as one party to a dispute, you will achieve the outcome you hope for.
“There is no guarantee that we will ‘side’ with you – indeed intractable disputes can cause us to take other types of regulatory action in response to governance failures that arise.”
Stephenson did not name any particular charity but said disputes often revolve around who the “rightly appointed trustees actually are” and that arguments like this should be resolved internally instead of being referred to the regulator.
Stephenson said that the challenging climate for charities due to the pandemic and cost-of-living crisis could be what has led to “cracks in relationships.”
Trussell Trust Staff Under ‘Immense Pressure’ as Record Number of Food Parcels Delivered.
The Trussell Trust has said its staff and volunteers are under “immense pressure” amid “ever-growing” need for its services, as the charity reported delivering a record number of food parcels last year.
Figures published by the food bank charity show it delivered almost three million emergency food parcels in the 12 months to the end of March, up from 2.2 million the year before and more than double the amount five years earlier.
Helen Barnard the charity’s director of policy, research and impact said it had been “challenging emotionally” for staff and volunteers and it was “becoming harder to fulfil the need from donations.”
The charity reported that it delivered three million emergency food parcels in 2022-23, with more than one million going to children for the first time.
Its overall total exceeds the second highest amount delivered in 2020-21 (2.6 million) and is more than double the number distributed in 2017-18 (1.4 million).
Asked about the impact on the charity’s workforce, Barnard said: “It is pretty immense pressure on both staff and volunteers. People are telling us that they are really, really tired.
“We have been through the pandemic – that was really tough. We then went straight into the cost-of-living crisis. But actually, the increase we are seeing this year is part of a longer-term trend, where need is going up steeply.
Barnard said the charity’s local members had found that it was “becoming harder to fulfil the need from donations” of food.
The charity is lobbying the government, alongside the Joseph Rowntree Foundation, for an increase to Universal Credit payments by at least £35 a week to cover the cost of essential items for a single person.
Barnard said it was important for the charity to continue its campaigning work despite having stretched resources.
Charity Donations Halved to £4.3bn Last Year Amid Cost-of-living Pressures
The value of charitable donations in the UK fell by more than half last year to £4.3bn, according to a new report.
Benefact Group’s inaugural Value of Giving report says that charitable donations fell by £5bn in 2022 from £9.3bn the year before, which it attributes to increased living costs for UK households and soaring bills over the past year.
The report also says that while the average cash value of donations and amount of time spent volunteering have decreased during the cost-of-living crisis, the number of people giving and volunteering is higher than pre-pandemic levels.
It says that 76% of UK adults donated to charity in 2022, up from 64% in 2018-19, but average amount given by those donating over a year has more than halved since the beginning of the pandemic, falling from £261 in 2018-19 to £101 in 2022.
The research says the value of volunteering rose sharply in the last decade, from £11.2bn in 2011 to £18.7bn in 2019. This fell to £11bn during the 2020 lockdowns and rose back to £18.7bn in 2022.
The report also found that while the average cash value of donations and amount of time spent volunteering have decreased during the cost-of-living crisis, the number of people giving and volunteering is higher than pre-pandemic levels.
Mark Hews, group chief executive of Benefact Group, said: “The charity sector is a cornerstone of British society, and this report quantifies the combined value of the charitable donations and volunteering to the economy, for the first time.”
The research in the report was based on analysis of the UK Household Longitudinal Survey (UKHLS), which provides detailed information on life in the UK at an individual level.
Charities Act 2022 Implementation
In February the Charities Act 2022 was passed. The first phase of implementation started in October 2022, and the next phase begins this spring.
Key changes coming into force soon include the following:
changes to the sale, leasing or other disposal of land. It will become easier to dispose of charity land as a wider range of people will be able to advise trustees,
New statutory powers will come into effect for charities with a permanent endowment which will change how charities can spend or borrow against their endowment,
The Commission will gain powers to stop charities using names that are too similar to other organisations, or are offensive misleading,
the definition of ‘connected persons’ will be updated and clarified.
To read the full Charities Act 2022 implementation plan please click here
Campaigning and Political Activity Guidance for Charities
As we approach the local elections, trustees and charity leaders should think about their campaigning roles. Charities can campaign on areas which relate to their objectives and advance their purposes, as long as these are not party political.
There are also areas of election law that affect non-political campaigners like charities. To learn more about charities and campaigning please click here