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Charities Bill [HL]

My Lords, as in previous debates on this subject on this Bill, I declare an interest as the deputy chairman of the Association of Governing Bodies of Independent Schools. We have already discussed at some length the position of independent schools, and I do not intend to go over the previous ground in any detail. The only way I will follow the noble Lord is in being as brief as I can about the issues. I strongly disagree with the noble Lord about the value of charitable status and the way that independent schools look at it. He put particular emphasis on the financial benefits. The tax benefits amount to something like £100 million a year. In past debates I have gone into rather greater detail about the financial aspects, but suffice it to say that, if one takes into account all the other aspects, broadly speaking, the independent schools contribute twenty times that to education as a whole and to the public good. So one may well ask, ““Why put such emphasis on the financial benefits?””. The noble Lord conceded the financial benefit point and suggested that this could best be dealt with in a Finance Bill. We have debated this in Committee, and he knows as well as I do that that is no commitment. It would perhaps be an inappropriate place to deal with the issue. Given the nature of the problems facing the Chancellor with his fiscal deficit, I doubt whether it would happen. We cannot go down that route. There is another point. If the financial benefits seem to go the other way, why does the independent sector value charitable status so much? There are two basic reasons. It has a strong sense of public good, and charitable status underlines that. There is another practical problem. If charitable status is lost, there would be difficulties regarding all the assets that belong to independent schools. That would threaten the whole nature of independent schools. I wish that the noble Lord had not talked only about Eton and Harrow. I could have talked about a much wider range of independent schools that make a major contribution to public benefit—indeed a substantial proportion of pupils now attending independent schools receive some form of bursary help. That leads me on to my second point about public benefits. I want to underline the fact that the independent schools entirely accept the position in the Bill about public benefit. Increasingly over the past 10 years, more and more has been done by the schools to provide public benefit in all sorts of ways. I have elaborated on those before and do not intend to do so now. They take the matter very seriously. I have two reasons for speaking against the amendments, and they follow the general principles that have run through our debates on the Bill. First, we have constantly emphasised—in relation not just to this sector but to all charities—the importance of flexibility in defining public benefit, as social needs and conditions change. That is best preserved as it is in the Bill. Secondly, we have stressed above all the independence of the commission. We have resisted setting out detailed definitions of public benefit in the Bill, and we should not therefore legislate for a Secretary of State’s direction on one charitable activity alone for that one sector. Those two principles are undermined by the amendment. Ministers have rightly insisted on those principles throughout our debates. As this is possibly my last contribution to the Bill, I would like to pay tribute to the Minister, my noble friend Lord Hodgson of Astley Abbotts and the noble Lord, Lord Phillips of Sudbury, for the way in which they have conducted the passage of the Bill. It has been a model of how the House of Lords can contribute greatly to the legislative process. The Minister has been superb in the way he has listened to the debates and dealt with points and as a result the Bill is greatly strengthened. I agree with the two principles that Ministers have insisted on in the Bill, and I hope that we shall stick with them.