As a professional commission watcher, it’s been a bit of a full-on fortnight what with all that’s been going on with the Charity Commission.
Headlines have been the release of the National Audit Office report on the commission and its resulting analysis by the sector, the appearance by Paula Sussex, chief executive of the regulator, in front of the Public Accounts Committee to be grilled both on said report, and on its action in the bizarre case of the Durand Academy, a school with a dating agency registered to the same address, and the reappointment of chairman William Shawcross. Read more on A full-on fortnight for the commission…
There was a sense of excitement as the outspoken Sir Tim Smit, the co-founder and executive vice-chair of the Eden Project took to the stage at the Acevo Annual Conference 2014 yesterday. Smit is never backwards about coming forward (appropriate really, since ‘Tim Smit’ is a palindrome), and started his speech/rant – he admitted that he hadn’t really planned what he was going to say – by warning that he was “going to say some very horrible things”. Read more on My day with the vain, corrupt, and unmerged…
With a keynote that was well argued and well received, with attendees nodding their approval, Philip Kirkpatrick was perhaps the highlight of Monday’s Trustee Conference, organised by the National Council for Voluntary Organisations and supported by Kirkpatrick’s firm Bates Wells Braithwaite, which marked the start of Trustees’ Week.
Here’s a buffet of the other things that piqued my appetite in between Kirkpatrick, and the short and light speech from the charities minister Rob Wilson that rounded off the day. Bon appétit! Read more on Talking points from the Trustee Conference…
Small charities and staff pension schemes do not seem to go well together. Too often, when combined, they lead to disaster, particularly for the trustees.
A good example of this is Hirwaun YMCA, a small charity which, many years ago, hired two people without realising it was opening itself up to a large future pensions deficit. When the last member of staff left, the charity’s liability crystallised and it was required to pay off its debt immediately.
Hirwaun said it couldn’t afford to pay, and as a result the chair of the trustees has been sued personally for the money.
Hirwaun is by no means the only unincorporated charity to face closure because of a large and unexpected pensions bill for which the trustees are personally liable. And it is not the only charity where the pension plan trustee is considering suing trustees to get its money back.
In a way, the chair of Hirwaun is lucky. He can sell his charity’s building, close the YMCA down, and pay the debts. Others may not have the luxury of valuable fixed assets to help them out.
The problem is potentially widespread. Small charities up and down the land have signed up to unsuitable pension plans which they will find difficult to get out of, and will leave them with enormous bills when the last employee leaves. Incredibly, small charities are still signing up today to highly risky defined benefit pension plans, while at the same time large corporations are desperately shutting theirs down.
Why do trustees get themselves in these situations? Often because they don’t know what they are signing up for. It takes a lot of work and plenty of technical knowledge to find out your potential worst-case pensions liability, and anyone without a background in finance stands little chance.
Volunteers should not have to take on such risks. But they do, often without realising. And there is little by way of a safety net to help them.
Read more on Small charities and staff pension schemes do not mix…