Charity Commission for England and Wales consultation on the annual return
27 June 2022
The Charity Commission for England and Wales is consulting on changes to the annual return for charities. The number of core baseline questions being asked is doubling, from 16 to 32, and some charities may now need to answer 52 questions in total. Included is a new question for charities which are principally grant-makers on what percentage of grants were made to individuals and to other charities. The Commission will also ask whether any of those grants were to connected parties. Foundations may also appear as a risk category, as the Commission is seeking to identify which charities are reliant on a single income stream, and foundations with a single endowment could be included in this.
As well as this specific addition for grant-makers, there are lots of other questions ACF members will now have to answer questions on, from employment, salaries, premises and other aspects of their operation. Grantees who are charitable organisations will now also face an additional burden of reporting. Some of the proposed questions (from our first reading) could lead to misinterpretation, for instance about what counts as a “income stream” or who are employees and who external contractors. The reasons for the changes are to help the Commission spot risk types among charities. However, information from the annual return is also used by researchers and policy makers, and it is important that the information provided is accurate. Getting the questions right is therefore really important.
We are following up with the Commission on some of these issues and will report back further, but do have a look at the consultation yourself. The changes will come in from 2023. If you have any thoughts or concerns on the changes, please email [email protected].