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Charities Bill [Lords]

I am grateful to the hon. Member for Cheltenham (Martin Horwood) for raising this important issue. The letters from various charities that he read out were quite compelling and I hope that I can help to offer a way forward. I shall also address our amendment No. 35. As the hon. Gentleman said, the purpose of new clause 3 is to change the regime under which trustees may sell land belonging to a charity, where the land has been given to it through a bequest made under a will. One normal feature of that regime is that the charity trustees must obtain a surveyor’s report about the proposed sale. I have seen a letter from the Society of Trust and Estate Practitioners—STEP. I suspect the organisation has also written to other Front Benchers. The letter raises a number of concerns, which I have discussed with the Charity Commission. It seems pretty clear that the question is not, as the hon. Gentleman suggests, one of law but more of perception or administration—either the perception of the charities or the administration of the commission, as I shall explain when I have set out the legal position. The concern seems to be that, at present, separate reports have to be obtained in some cases where land is given to a charity in a will. One report has to be obtained by the personal representatives of the donor—that is, of the estate—and another by the trustees of the beneficiary charity or charities, resulting in unnecessary expense for the charity. I have talked to the Charity Commission about that concern at some length. In its view, the legal position is that there is never any need for double compliance with the regime. If the estate’s personal representatives sell the land in the course of their administration of the donor’s estate, the charity land disposal regime does not apply. If the administration of the estate has been completed and the land belongs to the charity, the personal representatives can sell it only as agents of the charity, or as its trustees. The charity trustees must comply with the charity land disposal regime, but their personal representatives need not. I hope that that makes clear the legal position on double compliance. STEP says in its letter—the point was repeated by the hon. Gentleman—that the situation is particularly difficult for legacy-receiving charities with non-executive trustees, because a surveyor’s report and a certification of compliance with the procedures must be obtained by the charity trustee personally. I checked with the Charity Commission on that point, and found that a whole range of powers given to trustees can be delegated to members of staff; the section 36 power is one of them. There is no need for the trustees personally to give approval—that was one of the concerns raised by STEP. I have made the position on double compliance clear, but to enhance understanding on all sides I have agreed with the Charity Commission that it will listen to representations about the practical implementation of the law on the subject, so that we can clear up any misperceptions or administrative problems. If the intention behind the amendment was the removal of the need for anyone to follow the normal requirements of the charity land disposal regime when selling land left to a charity as a legacy, there would be no justification for it. In other words, charity trustees should not be exempt simply because land has been given to them in a will. The regime is sensible, and it clearly encourages the trustees to carry out their duties properly and effectively; in addition, it ensures that, if charity land is sold, a proper price is obtained, so it is a necessary protection for charities and their beneficiaries. Having said that, the necessary content of the surveyor’s report is set out in regulations that are nearly 15 years old, so there is a question of administration, too. I said in Committee that the Government have undertaken to review those regulations, with a view to simplifying them, thereby reducing the costs of surveyors’ reports. Finally, although we note the intentions behind the hon. Gentleman’s amendment, as he set them out, I am advised that its wording will have quite a different effect. If charity trustees have followed the requirements set out in section 36(3) of the Charities Act 1993, they need not seek the authority of the commission for the sale. I know that this is not his intention, but if we removed the possibility of complying with those requirements, trustees selling land that they received in a will would always have to seek the authority of the commission. In practice, that would involve complying once again with a bureaucratic requirement.