Local authorities in England and Wales have been warned about the use of charitable land for which they are acting as trustees. The Charity Commission for England and Wales (the Charity Commission) has written warning them not to improperly dispose of or change the use of land for which they have responsibility.
The Charity Commission has updated its guidance in conjunction with the Local Government Association, highlighting that it has been handling cases involving council trusteeship and warns of the “significant administrative headaches” that councils could face from any failure to correctly comply with their duties.
More than 1,200 registered charities list a local authority as a trustee, primarily running community facilities such as recreation grounds, public gardens, concert halls and buildings of historic interest.
The Charity Commission says council trustees are changing the use or status of charitable land or disposing of it in a way that is incompatible with its charitable purpose and it is often done because the local authority does not understand it is acting as a trustee, rather than beneficial owner. In the last three years, the Commission has dealt with 38 separate cases involving local authorities and charitable land.
Issues that commonly arise as part of the regulator’s casework include when a council:
- Is unaware that it is a trustee of a charity.
- Does not keep separate accounts for the charity.
- Does not submit accounts or annual returns to the Commission when due.
- Unknowingly uses charity land for its own council purposes.
- Disposes of charity land without managing conflicts of interest that can arise between its role as trustee and statutory authority.
The Charity Commission accepts that the increased financial pressure on councils is likely to see a rise in the disposal of, or change of purpose for, charitable assets such as buildings or land.
External links
The Charity Commission Guidance: Local authorities (or councils) as trustees of charities
Press release: Regulator CEO urges councils to improve compliance with trustee duties
