Charities and Trustee Investment (Scotland) Bill: Stage 3
The next item of business is stage 3 of the Charities and Trustee Investment (Scotland) Bill. For the first part of the stage 3 proceedings, members should have a copy of the bill, the marshalled list, the supplement to the marshalled list and the groupings of amendments.
On amendments, an extended voting period of two minutes will be allowed for the first division. Thereafter, a voting period of one minute will be allowed for the first division after a debate on a group. All other divisions will last 30 seconds.
Section 1—Office of the Scottish Charity Regulator
Group 1 relates to matters to which the Office of the Scottish Charity Regulator must have regard in exercising its functions. Amendment 1, in the name of Donald Gorrie, is in a group on its own.
The purpose of amendment 1 is to redress what most people consider to be the bill's general thrust. People think that the bill is about regulating charities and, by implication, that it could be regarded as being slightly anti-charity. I know that that is no one's intention, but I wanted to include in the bill some wording that would make that clear.
According to amendment 1, OSCR would have to have regard to
"the desirability of promoting—
(a) philanthropy,
(b) voluntary activity, and
(c) the health of the charitable sector."
It is important that people continue to have the confidence to give their money and time to charities and that the charitable sector as a whole will blossom and flourish.
There are always technical arguments about whether such a provision should be included in legislation, but it is important that we make it clear that the bill is pro-charity. I will listen with interest to what the minister has to say. If she says the right things, I will not press amendment 1.
I move amendment 1.
I trust that I can rise to the challenge of saying something that is sufficient to make Donald Gorrie act against his instincts.
Donald Gorrie made the point that he believes that the general thrust of the bill could be seen to be negative and, by implication, that it is anti-charitable sector. I argue that the bill's thrust is against the corrupt use and abuse of the word "charity", and against abuse of people who give of their time and resources to support good works. It is entirely right that, in regulating the sector, we will strengthen it rather than weaken it.
I acknowledge that amendment 1 is linked to the Communities Committee's recommendation in its stage 1 report that the Executive should consider including in the bill
"more general reference to promoting a flourishing charitable sector in Scotland".
I do not denigrate the thinking behind the lodging of amendment 1, but the bill has always been intended to help the charitable sector in Scotland to flourish by providing a robust but not overly onerous regulatory regime that will give the public confidence in donating to charity. That is the whole point of the bill.
We do not, however, believe that the bill should dictate how OSCR exercises its functions. OSCR is the independent regulator and should be concerned first and foremost with compliance with the law as set out in the bill. We intend that benefits to the sector will flow from that, in that public confidence will be increased and clarity will be provided to charities about what is required of them. Indeed, it is evident that the sector itself also has a responsibility to encourage the existence and development of a flourishing sector.
Although we agree whole-heartedly with the sentiment behind Donald Gorrie's amendment, we do not believe that it should be stated on the face of the bill. The argument is not technical; we genuinely believe that there is a broad range of roles for OSCR and for the sector that are entirely determined by the existence of the legislation. I urge Donald Gorrie, who has listened attentively, to seek to withdraw amendment 1.
The minister gets an alpha minus. I will not press amendment 1. With Parliament's leave, I will withdraw it.
Amendment 1, by agreement, withdrawn.
Group 2 is on guidance. Amendment 46, in the name of Patrick Harvie, is in a group on its own.
Donald Gorrie's amendment 1 nodded in the right direction; the sentiment behind amendment 46 is similarly intentioned. The placing of a duty on OSCR to consult representatives of the charity sector on guidance that will have a significant impact on the sector is a slightly stronger formulation than that which Donald Gorrie used. He said that OSCR
"must have regard to the desirability of promoting"
certain qualities in the sector. I do not expect a wave of support to come crashing down on me, as Donald Gorrie also somehow missed out on such a wave.
The intention behind amendment 46 is for the bill to lead to stronger and more constructive relationships between the regulator and the sector. It is possible to promote that kind of good practice through consultation and by working together in a number of different ways. It need not be on the face of the bill. It has been suggested that a concordat between the regulator and the sector could achieve that end.
Agreement to amendment 46 would make it crystal clear to all concerned that, where decisions have a significant impact on the sector—I am not talking about every little matter—the organisations concerned should expect to be consulted. Amendment 46 would not in any way undermine the independence of OSCR as a regulator. I hope that the minister will be open to the amendment.
I move amendment 46.
I support amendment 46. I refer Parliament to the spirit of the committee's stage 1 report. In paragraph 21 of the executive summary, we say:
"The Committee … encourages the Executive to ensure that charities have the advice and support necessary to help them adapt to the new regulatory framework."
The committee also made it plain that it did not want a burden to be placed on OSCR for specific guidance, but that charities should be given more general guidance about the appropriate direction in which to go, thereby helping them to avoid falling foul of regulations. The Scottish National Party supports amendment 46.
A similar amendment was lodged at stage 2 and the committee rejected it because it would have resulted in OSCR having to consult every time it issued any guidance. Although amendment 46 would not cause that problem, we will continue to resist such an amendment to the bill; its potential to cause difficulties outweighs any benefit. As the bill stands, there is nothing in it to prevent OSCR from producing guidance: in fact, OSCR already produces guidance on the current legislation and we expect it to continue to do so. It is entirely unnecessary to include a permissive provision.
On consultation, OSCR is already under a duty to consult on guidance on how it determines charitable status. It will also consult on some of the other guidance that it will issue. In deciding on the guidance on which it is to consult, OSCR—as a public body—is under a duty to be proportionate, accountable, consistent and transparent. Not only is it unnecessary to place a duty on OSCR to consult, to do so could have a negative impact on OSCR's regulatory function if, after repeated challenges of its assessment of what is significant under such a duty, OSCR were obliged to consult on even minor administrative guidance. Therefore, I ask Patrick Harvie to seek to withdraw amendment 46.
I am not convinced that amendment 46 leaves open the possibility that OSCR will be forced to consult on every minor issue; the phrase "significant impact" is fairly clear. Therefore, I will press the amendment to a vote.
The question is, that amendment 46 be agreed to. Are we agreed?
No.
There will be a division.
For
Adam, Brian (Aberdeen North) (SNP)
Baird, Shiona (North East Scotland) (Green)
Ballance, Chris (South of Scotland) (Green)
Ballard, Mark (Lothians) (Green)
Byrne, Ms Rosemary (South of Scotland) (SSP)
Canavan, Dennis (Falkirk West) (Ind)
Crawford, Bruce (Mid Scotland and Fife) (SNP)
Cunningham, Roseanna (Perth) (SNP)
Ewing, Fergus (Inverness East, Nairn and Lochaber) (SNP)
Ewing, Mrs Margaret (Moray) (SNP)
Fabiani, Linda (Central Scotland) (SNP)
Fox, Colin (Lothians) (SSP)
Gibson, Rob (Highlands and Islands) (SNP)
Grahame, Christine (South of Scotland) (SNP)
Harvie, Patrick (Glasgow) (Green)
Hyslop, Fiona (Lothians) (SNP)
Ingram, Mr Adam (South of Scotland) (SNP)
Leckie, Carolyn (Central Scotland) (SSP)
MacAskill, Mr Kenny (Lothians) (SNP)
Marwick, Tricia (Mid Scotland and Fife) (SNP)
Mather, Jim (Highlands and Islands) (SNP)
Matheson, Michael (Central Scotland) (SNP)
Maxwell, Mr Stewart (West of Scotland) (SNP)
McFee, Mr Bruce (West of Scotland) (SNP)
Morgan, Alasdair (South of Scotland) (SNP)
Neil, Alex (Central Scotland) (SNP)
Ruskell, Mr Mark (Mid Scotland and Fife) (Green)
Scott, Eleanor (Highlands and Islands) (Green)
Stevenson, Stewart (Banff and Buchan) (SNP)
Swinburne, John (Central Scotland) (SSCUP)
Swinney, Mr John (North Tayside) (SNP)
Turner, Dr Jean (Strathkelvin and Bearsden) (Ind)
Welsh, Mr Andrew (Angus) (SNP)
White, Ms Sandra (Glasgow) (SNP)
Against
Aitken, Bill (Glasgow) (Con)
Arbuckle, Mr Andrew (Mid Scotland and Fife) (LD)
Baillie, Jackie (Dumbarton) (Lab)
Baker, Richard (North East Scotland) (Lab)
Barrie, Scott (Dunfermline West) (Lab)
Boyack, Sarah (Edinburgh Central) (Lab)
Brankin, Rhona (Midlothian) (Lab)
Brocklebank, Mr Ted (Mid Scotland and Fife) (Con)
Brown, Robert (Glasgow) (LD)
Butler, Bill (Glasgow Anniesland) (Lab)
Chisholm, Malcolm (Edinburgh North and Leith) (Lab)
Craigie, Cathie (Cumbernauld and Kilsyth) (Lab)
Curran, Ms Margaret (Glasgow Baillieston) (Lab)
Deacon, Susan (Edinburgh East and Musselburgh) (Lab)
Douglas-Hamilton, Lord James (Lothians) (Con)
Eadie, Helen (Dunfermline East) (Lab)
Ferguson, Patricia (Glasgow Maryhill) (Lab)
Fergusson, Alex (Galloway and Upper Nithsdale) (Con)
Finnie, Ross (West of Scotland) (LD)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Gallie, Phil (South of Scotland) (Con)
Glen, Marlyn (North East Scotland) (Lab)
Godman, Trish (West Renfrewshire) (Lab)
Gorrie, Donald (Central Scotland) (LD)
Henry, Hugh (Paisley South) (Lab)
Home Robertson, John (East Lothian) (Lab)
Hughes, Janis (Glasgow Rutherglen) (Lab)
Jackson, Dr Sylvia (Stirling) (Lab)
Jackson, Gordon (Glasgow Govan) (Lab)
Jamieson, Cathy (Carrick, Cumnock and Doon Valley) (Lab)
Jamieson, Margaret (Kilmarnock and Loudoun) (Lab)
Johnstone, Alex (North East Scotland) (Con)
Kerr, Mr Andy (East Kilbride) (Lab)
Lamont, Johann (Glasgow Pollok) (Lab)
Livingstone, Marilyn (Kirkcaldy) (Lab)
Lyon, George (Argyll and Bute) (LD)
Macdonald, Lewis (Aberdeen Central) (Lab)
Macintosh, Mr Kenneth (Eastwood) (Lab)
Maclean, Kate (Dundee West) (Lab)
Macmillan, Maureen (Highlands and Islands) (Lab)
Martin, Paul (Glasgow Springburn) (Lab)
May, Christine (Central Fife) (Lab)
McCabe, Mr Tom (Hamilton South) (Lab)
McMahon, Michael (Hamilton North and Bellshill) (Lab)
McNeil, Mr Duncan (Greenock and Inverclyde) (Lab)
McNulty, Des (Clydebank and Milngavie) (Lab)
Milne, Mrs Nanette (North East Scotland) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Morrison, Mr Alasdair (Western Isles) (Lab)
Muldoon, Bristow (Livingston) (Lab)
Mulligan, Mrs Mary (Linlithgow) (Lab)
Munro, John Farquhar (Ross, Skye and Inverness West) (LD)
Murray, Dr Elaine (Dumfries) (Lab)
Oldfather, Irene (Cunninghame South) (Lab)
Peacock, Peter (Highlands and Islands) (Lab)
Peattie, Cathy (Falkirk East) (Lab)
Pringle, Mike (Edinburgh South) (LD)
Purvis, Jeremy (Tweeddale, Ettrick and Lauderdale) (LD)
Radcliffe, Nora (Gordon) (LD)
Rumbles, Mike (West Aberdeenshire and Kincardine) (LD)
Scanlon, Mary (Highlands and Islands) (Con)
Scott, John (Ayr) (Con)
Scott, Tavish (Shetland) (LD)
Smith, Elaine (Coatbridge and Chryston) (Lab)
Smith, Iain (North East Fife) (LD)
Smith, Margaret (Edinburgh West) (LD)
Stephen, Nicol (Aberdeen South) (LD)
Stone, Mr Jamie (Caithness, Sutherland and Easter Ross) (LD)
Wallace, Mr Jim (Orkney) (LD)
Watson, Mike (Glasgow Cathcart) (Lab)
Whitefield, Karen (Airdrie and Shotts) (Lab)
Wilson, Allan (Cunninghame North) (Lab)
The result of the division is: For 34, Against 72, Abstentions 0.
Amendment 46 disagreed to.
Group 3 is on OSCR's regulatory powers. Amendment 20, in the name of the minister, is grouped with amendments 27, 58, 33, 59, 64 and 45. If amendment 58 is agreed to, amendment 33 will be pre-empted.
I am sure that the committee agrees that, over the piece, the bill has been a good piece of work, in that there has been a lot of constructive discussion and debate as the bill has progressed through its stages. However, there was a lot of wrestling and disagreement over mismanagement and misconduct, which is the issue that we seek to address in this group of amendments. I hope that members will forgive me if I take a bit of time to elaborate on the Executive's position on those matters, as they are at the centre of some of the concerns about the bill.
The group is about OSCR's regulatory powers and the enforcement of trustee duties. There was a huge concern that, if trustee duties were considered to be too onerous, people would be deterred from taking up the responsibility of being trustees at all and that there would be a consequential impact on charities. That is a concern that we all share, and it is certainly not the Executive's intention to do anything to deter people from acting as trustees, so we were keen to find a way to make it clear that the regulatory framework was proportionate.
During stages 1 and 2 of the bill, there was significant discussion about what actions ought to be taken if breaches of charity trustee duties became apparent and about the definition of misconduct and the circumstances in which OSCR and the courts should take regulatory action against a charity trustee—or any other person—who breached any of the bill's provisions.
There was concern that making the duties of charity trustees and the consequences of breach too onerous could discourage volunteers or anyone else from taking on a role in charities. On the other hand, the bill is intended to establish a robust regulatory regime from which the public can take reassurance that any charity is well regulated, so that they can therefore have confidence when donating to or volunteering for a charity. It is at the heart of the bill that we strike the balance between not deterring those who wish to give of their time and re-establishing and sustaining confidence in the sector.
Existing charity law refers to both misconduct and mismanagement, allowing ministers, through OSCR, and the courts to take action in the event of either arising. The bill as introduced sets out that any breach of the provisions by a charity trustee is to be treated as misconduct. For clarification, mismanagement is defined in the bill as being included within misconduct. At stage 1, many of those who gave evidence suggested that they considered mismanagement to be more related to mistakes and minor breaches than misconduct, which was considered to cover intentional breaches. That distinction is not necessarily sustained, however, even if it is how people feel about those two words. I do not want to dance on the head of a pin as far as that is concerned, although the issues are substantial. The distinction is not substantiated by the dictionary definition. The dictionary establishes that the words "misconduct" and "mismanagement" do not distinguish between intent and error. Amendments based on that understanding consequently do not achieve what was desired and give rise to unintended difficulties.
Many people felt that OSCR and the courts should be able to take regulatory action only in serious or intentional cases. The Executive has argued that it is more appropriate for the bill to be unequivocal and that any breach is misconduct, but that OSCR will, in practice, take only action that is necessary. The Executive attempted to reassure the Communities Committee at stage 2 that when OSCR took action, it would do so proportionately. As a public body, OSCR has a duty to act proportionately and reasonably under common law, and its decisions and processes may be subject to appeal or judicial review.
Despite the power of the argument that the Executive presented to it, at stage 2 the committee agreed to amendment 149, which amended section 65(4) so that any breach of the trustee duty
"may be treated as being misconduct",
rather than
"is to be treated as being misconduct".
In light of our concerns, I indicated to the committee that we would wish to return to the matter at stage 3. I wrote to the convener, explaining why we would wish to reverse that amendment at this stage.
At stage 2, the committee also agreed to amendment 5, which changed the definition of misconduct in section 103 so that it did not include minor mismanagement. The Executive understood why that was done, and although I do not wish to minimise the concerns that were reflected in that amendment, the Executive was concerned that, together with amendment 149, which was agreed to at the preceding committee meeting, amendment 5 had the effect of undermining OSCR's discretion, removing clarity and making effective regulation more difficult.
Neither of those amendments offers charity trustees the sort of reassurances that the committee sought, because it is still within OSCR's discretion to decide whether or not a breach is misconduct, and even minor breaches—other than those related to bad management—can still be considered misconduct. It is normal practice in legislation that action can be taken by a regulator in any case of a breach of the law. As I argued in my recent letter to the committee, if action cannot be taken following a breach of legislation, there is little point in its being set out as part of the law; in practice, that merely amounts to guidance.
The amendments that we are proposing seek to impose specific requirements in the bill that OSCR must act proportionately and reasonably. Amendments 27 and 20 have been lodged to reassure members that actions against breaches of trustee duties and other cases of misconduct will not be taken unless they are really deemed necessary. That lies at the heart of the committee's concerns. Amendment 27 specifically restricts OSCR's section 31 powers to suspend a charity trustee unless such action is necessary and reasonable.
Amendment 20 is a more general provision that requires OSCR to act in accordance with best regulatory practice when carrying out all its functions. That provision is similar to the duty that has been proposed for the Charity Commission for England and Wales under the Home Office's recently reintroduced Charities Bill. The criteria that are used to describe best regulatory practice—proportionality, accountability, consistency, transparency and targeting—are those that are recommended for regulation and enforcement by the better regulation task force, and they have been widely accepted. OSCR's decisions are also subject to review and appeal, and it is under a duty to publish a report whenever it takes regulatory action under sections 30 and 31.
Donald Gorrie's amendment 58 appears to have the same intended effect as our amendments 20 and 27. However, amendment 58 is limited to instances in which OSCR may consider action against charity trustees; it does not address the instances in which OSCR may consider action against the employees of charities. I believe that OSCR needs to act proportionately in respect of both charity trustees and charity employees. Our amendment 20 achieves that; amendment 58 does not.
Amendment 58 could cause other problems. It would restrict OSCR's powers to take action against a breach of the charity trustee duties to ensure that they are appropriate and proportionate. That would be fine, but by also relating that restriction to the human resources of the charity, it would provide an unacceptable defence against breaching the law. The charity trustee duties are set out in the bill because they are important.
I turn to Donald Gorrie's amendments 59 and 64. I understand that amendment 64 is intended to replace amendment 59, so I shall limit my comments to it. Amendment 64 seeks to place all charity trustees under a duty to take such steps as are reasonably practicable to ensure that any breach of a charity trustee's duties is corrected by the trustee concerned and is not repeated and that any trustee who has been in serious or persistent breach of either or both duties under sections 65(1) and 65(2) is removed as a trustee. That complements the powers that OSCR has and I encourage the Parliament to support the amendment.
Amendments 33 and 45 reverse the changes that the committee made at stage 2. We trust that, as we have provided the reassurance in the bill that OSCR must act proportionately, members will understand the logic behind those amendments. Under amendment 20, OSCR will have a general duty to act proportionately in all its functions. Under amendment 27, OSCR's specific powers to suspend a person from being in management or control of a charity are subject to its being able to justify that the person has not acted honestly and reasonably in relation to the misconduct concerned and ought not to be excused. I urge members to accept Executive amendments 20, 27, 33 and 45 and Donald Gorrie's amendment 64, and to reject the other amendments in the group.
I move amendment 20.
I will take this bit by bit, because, as Johann Lamont said, the issue to which this group relates is at the heart of the bill.
The amendment that is now amendment 64 started off as amendment 59. It suffered the usual fate of my amendments and was rewritten by the wise people who do those things. I suppose that it has been improved, although I cannot honestly say that I know why. I am going with amendment 64—one has to go with the flow.
The point of amendment 64 is simple, and Johann Lamont set it out correctly. If a trustee of a charity finds that another trustee who is the treasurer or holds some other post is failing to do his job by not sending in the accounts on time, it is up to them to put the screws on that other trustee to ensure that the accounts are sent in on time next year. If a trustee is failing in his duties seriously and persistently, it is the duty of the other trustees to remove him. That seems fairly straightforward and the Executive supports it, which is fine.
I turn to the issue of proportionate regulation, which my amendment 58 tries to achieve. To give the Executive due credit, after discussing the issue with committee members it lodged amendments 20 and 27, which achieve most of what we were on about in raising the question of any penalty being proportionate to the wrongs done. We felt that the bill did not distinguish between somebody who had put in their accounts a day late and somebody who was off to the Bahamas with all the money. We want there to be proportionate penalties or disciplinary action against trustees. Executive amendment 20 meets that aim reasonably well as it states:
"regulatory activities should be proportionate, accountable, consistent, transparent and targeted only at cases in which action is needed".
If a small charity is slightly incompetent about its accounts, it gets a stern letter saying, "Look you really have to brace up and do this better next year." That is proportionate to the offence.
Amendment 27 deals with whether OSCR can suspend a charity trustee. It states that if
"the person has acted honestly and reasonably in relation to the misconduct concerned"
he or she will be excused.
The two Executive amendments 20 and 27 are helpful. Members will not be surprised to hear that I think that my amendment 58 is better, but I recognise that the world is as it is and I will go with the flow and not move amendment 58.
However, I feel strongly about the Government's amendments 33 and 45. Those amendments seek to overturn the amendments at stage 2 that related to misconduct. This is not a party-political issue; it is a common-sense or how-one-sees-the-world issue. As I see the world, misconduct is quite different from mismanagement. In support of that view, I will pray in aid a senior civil servant, Mr A J MacDonald, who is a civil service commissioner. This very important gentleman wrote a report for the benefit of Mr Elvidge, who runs our civil servants, as a follow-up to the report of the Fraser inquiry. In his report, Mr MacDonald clearly distinguishes between misconduct and mistakes in administration. For example, he says:
"there are, in my view, no instances of ‘misconduct' which would cause me to advise you to consider disciplinary proceedings against any official".
That means that there was no misconduct. He goes on to say:
"Mistakes were made in the administration of the Holyrood Project".
He is talking about the way in which the project was mismanaged, rather than a matter of misconduct. The problems were a matter of poor administration rather than misconduct. The judgment of officials might or might not have been satisfactory but the matter was not one of misconduct.
Although I could bore members with many more quotes, I will not. However, it is quite clear that, in the eyes of that civil service dignitary, there is a difference between misconduct and mismanagement. I still feel that there is an issue. I will not make a big political point about it, but I might well abstain when it comes to voting on amendments 33 and 45. The Executive has a genuine point of view on which it has been advised, and it will therefore go ahead and do its thing, but it is wrong.
I hope that members will support amendments 64, 20 and 27. They can make up their own minds about amendments 33 and 45.
The Scottish National Party supports amendments 20 and 27. I note that amendment 58 has been supplanted by amendment 64, which we also support.
I have the same concerns as Donald Gorrie has with regard to amendments 33 and 45. The committee was clear that there is a world of difference between mismanagement and misconduct. Mismanagement might be so gross that it can be interpreted as being misconduct, but there are minor errors that cannot be called misconduct. The SNP will not be supporting the Executive's amendments 33 and 45, which seem to fly in the face of the rather decent-spirited amendments that were agreed to at stage 2 and which reflected the strong views of the committee, whose stage 1 report says:
"The Committee recommends that the Executive should amend the definition of "misconduct" in section 103 to reduce the possibility of those charity trustees who make relatively minor and genuine errors of mismanagement having action taken against them."
That was a unanimous recommendation and, as far as I know, the committee's view has not shifted.
Members who have not followed the bill in as great a level of detail as committee members have might be slightly confused about the amount of time that we seem to have given this afternoon to the words "mismanagement" and "misconduct". However, I stress that the point is not anorakish or semantic. The committee's position reflects concerns that were raised with the committee by many witnesses and which were highlighted by a number of the committee's members who spoke in the stage 1 debate.
We have all struggled to find a way around the issue, given that we were dealing with the bill as it was and the fact that the Executive believed mismanagement and misconduct to mean the same thing, while almost everyone else thought that there was a clear distinction between the two terms. The debates and amendments on the issue at stage 2 reflected many people's desire to encompass that distinction in the bill.
As Johann Lamont said in her opening remarks, amendment 20 goes a considerable way towards helping us out of the difficulty that we appear to be in over this issue by making it clear that OSCR should act proportionately and be accountable. Agreeing to that amendment would go some way towards resolving some of the difficulties that some of us have had over the issue.
We must make it clear that we have laboured this point so consistently and strongly because we do not want to dissuade anybody from becoming a charity trustee. We certainly do not want to encumber people with a bad reputation because of a genuine error that may be construed, in other circumstances, as the action of someone who was at it. It is that distinction that we want to make.
Amendment 20 goes some way towards achieving the right balance and is a welcome addition at this stage. It is worthy of support.
I am happy to follow my committee colleagues and speak to the amendments, as have others, in a non-party-political way. This has been a serious issue for the committee, and I seek further clarification from the minister on amendments 27 and 45.
I, too, will be a bit of an anorak. The "Oxford English Dictionary" defines misconduct as:
"Improper or unacceptable conduct or behaviour."
It defines mismanage as:
"To manage badly or wrongly".
I am not sure that we have the solution to the problem today.
Amendment 27 states:
"OSCR's power to suspend a person by giving notice under subsection (4)(a) or (b) does not apply if OSCR considers that the person has acted honestly and reasonably in relation to the misconduct".
How can someone honestly and reasonably indulge in unacceptable or improper behaviour? I find that difficult to understand. I understand that a person could act honestly, reasonably and innocently in relation to mismanagement, but could they act honestly and reasonably in relation to misconduct? The definition of misconduct does not sit fairly and squarely with honest and reasonable behaviour. Someone cannot honestly and reasonably behave in an unacceptable and improper way.
If amendment 45 were agreed to, the bill would read, "‘misconduct' includes mismanagement". Does that mean honest and reasonable misconduct or downright serious, unforgivable, unacceptable or improper behaviour? I have serious problems with the amendments. It seems that we would be making misconduct acceptable. Amendment 27 states that misconduct is acceptable, as it attaches the words "honestly" and "reasonably" to it.
I seek further clarification from the minister on the matter. I would like to support amendments 27 and 45 but, like Donald Gorrie, I may have to abstain on the issue.
As Mary Scanlon says, there is a difference between misconduct and mismanagement. What the terms mean to potential trustees and the general public is important. I do not accept the argument that misconduct and mismanagement mean the same thing, and I believe that the vast majority of people do not think that they mean the same thing. I do not care about all the talk from the civil servants and the semantic dancing that is going on here. As far as I am concerned, if someone is accused of misconduct there is a perception that they have knowingly done something wrong.
I ask every MSP to consider what their own position would be if they were a charity trustee who was reported as having been guilty of misconduct. They would have the press all over the place, looking to see whether they had filched money, taken a holiday abroad or whatever. Mismanagement is a different thing. Someone who has submitted their accounts a day late has mismanaged and pays the penalty for that. Misconduct is completely different. I refuse to accept that the might of the civil service down the road could not come up with an acceptable way of reflecting the unanimous view of the Communities Committee.
It is obvious that consensus has managed to break down for a little while before we move on to more positive matters.
It is not the view of the civil service down the road that it is seeking to ensure that its will prevails over that of the Parliament. The Scottish Executive has come to a view, which it has expressed through its amendments, about how to address the concerns that have been raised. Members can criticise the Executive for that, but the situation has not arisen because civil servants want to dance on the head of a pin. I assure Linda Fabiani that although I might not have applied my intellectual faculties to the matter in the way that she would wish me to, I have actually tried to apply them, as have people throughout the Executive. Therefore, she can take dispute with me, rather than try to take the argument somewhere else.
Linda Fabiani and others have said before that they do not accept that, for the purposes of the law, mismanagement is regarded as a subset of misconduct. We can take a view one way or the other on whether we want to believe that, but we must determine how the law would be interpreted if a case came to court.
Although we do not want to deter trustees from taking an active part in the work of charities, there is another side to the matter. We must not create the impression that being a trustee brings no consequences and responsibilities with it if there is wilful misconduct, and trustees have a responsibility to try their best not to make mistakes.
I am intrigued that Donald Gorrie brought into his defence someone who reported on the Fraser inquiry report—I contend that that was a challenging comparison. The civil service commissioner to whom Donald Gorrie referred said that misconduct was distinct from blameworthy behaviour. However, the civil service commissioner was clear at the start of his report. He makes certain assumptions about culpability when he sets out his approach to determining whether misconduct has taken place. That he does so is evidence of the fact that any judgment about intent or error is not inherent in the term "misconduct". If it were, he would not have needed to set out that statement at the start of his report.
In some ways, the example of the Fraser inquiry and what it reported on highlights the fact that sometimes there is a false distinction between the consequences of misconduct and those of mismanagement. If anything were to happen in the Parliament as a consequence of a mistake rather than as a result of wilful error, there would still be a significant impact on the Parliament. Equally, we all accept that mistakes made over time would have an impact on a small charity, regardless of the motive of the people who made the mistakes. That is what we are wrestling with today, and what the Executive has wrestled with.
We were concerned about the committee's approach at stage 2 in trying to include in the bill a way of recognising and addressing the problem. We contend that the committee's approach was not the right way to address the problem because it would not give the reassurance about the position of trustees that people sought. Indeed, it would create in the legislation extra layers before OSCR could take action.
It is important that OSCR acts proportionately when it takes action. OSCR would be expected to act proportionately if someone did not put a stamp on an envelope or forgot to post their accounts. If a charity has a series of problems because a range of mistakes have been made, we would not expect OSCR not to intervene. However, the way in which OSCR intervened would still have to be proportionate.
I urge people not to think that there is a huge division in the chamber, but to recognise that we are wrestling with two distinct matters: the effective management of charities; and support for people who want to become active in charities. If we support the Executive amendments, the Executive will address those concerns with the committee and give strength to OSCR's role while making it clear that our expectation of OSCR is that it should act proportionately. I urge members to support amendments 20, 27, 33, 45 and 64.
Amendment 20 agreed to.
Section 7—The charity test
Group 4 is on the charity test and charitable purposes. Amendment 21, in the name of Scott Barrie, is grouped with amendments 2, 47, 3, 4, 48 and 5.
The effect of amendment 21 would be to extend the definition of "the advancement of education" in the list of charitable purposes in the bill to recognise the significant contribution that youth work makes through the provision of non-formal education opportunities to promote and support the development of young people.
Amendment 21 is similar to an amendment that I lodged at stage 2. When the Deputy Minister for Communities spoke to that amendment, she suggested that I had not provided an adequate definition of youth work. She also expressed concern that the amendment, rather than widening the definition of education, might narrow it by excluding other types of non-formal education. Clearly, that is the opposite of what I was trying to achieve.
Amending the definition of education in the bill's list of charitable purposes would complement the Scottish Executive's commitment, which it made in "A Partnership for a Better Scotland", to develop and launch a national youth work strategy before the end of the current session of Parliament. Amendment 21 should be seen in that context. If we extend the definition of education, we will not only recognise the significant contribution that youth work makes but help it to meet future challenges by making it more attractive for external funders to support and nurture the sector.
I am aware that section 7(2)(m) in the list of charitable purposes refers to
"any other purpose that may reasonably be regarded as analogous to any of the preceding purposes."
It may well be that the Minister for Communities thinks that that is enough to cover the issue that I raise. If so, I will welcome his further reassurance on the point. It would also be helpful if he could confirm that his understanding of the definition of education includes not just schools but education in its widest sense. That will go a long way to clarifying the point that I raise.
Amendments 2 and 47 deal with amateur sport, and I know that other members will speak to them extensively. There has been a lot of lobbying from sporting organisations about the outmoded and outdated use of the word "amateur", and we need to consider the matter. Amendments 2 and 47 are worthy of consideration and support.
I move amendment 21.
I have some sympathy with amendment 21 and I hope that the minister will be able to give reassurances on the point.
On amendments 2 and 47, I hope that all will end satisfactorily. As Scott Barrie said, there is a great deal of concern in the sporting world about the use of the word "amateur". Many British, Scottish and international sporting bodies have dropped the word from their titles because it is an outdated term. I lodged amendment 2, which seeks to leave out the word "amateur", but Karen Whitefield subsequently lodged amendment 47, which seeks to leave out the term "amateur sport" and include the term "public participation in sport". Amendment 47 is a reasonable amendment, which achieves what I was trying to achieve. I understand public participation to mean people who are on the park doing the thing, not people who are watching it on the telly in the bar or people in the crowd. I assume that that is how "public participation" is to be understood. I am content to support amendment 47 rather than amendment 2.
The Executive's amendments 3 and 4 seek to include in the list of charitable purposes the "organisation of recreational activities" as well as the provision of facilities. They stem from an amendment that I lodged at stage 2 and withdrew—because I am a nice sort of guy—under pressure from the deputy minister, so I am pleased to have converted her to the right cause. I will support amendments 3 and 4 because they help to deal with the issue that I raise in amendment 48. The bill says that a sport must involve "physical skill and exertion". Personally, I have little physical skill but I used to be quite good at exertion; brute force and ignorance are what one needs for middle-distance running, and I had that. I do not have physical skill, but I admire people who do. A sport can involve physical skill but not breaking into a sweat. For example, snooker, billiards, pool, gliding, croquet, angling, target shooting and other activities that I will not bore members with are recognised by sportscotland as sports, but most people would agree that they do not involve physical exertion. However, the bill will still cover those sports if we agree to amendment 4, which proposes to add "or activities" after the word "facilities". I am content not to push amendment 48 if amendments 3 and 4 cover the matter properly.
The Communities Committee did much good work on the charitable purposes and greatly improved them. Even the English have copied some of our proposed charitable purposes, so if we can educate them, we are really in business.
I lodged amendment 47 following representations by sportscotland and the Scottish Sports Association, which expressed concerns about the use of the term "amateur". As Scott Barrie said, the term "amateur" is outmoded and has no place in a modern sporting context. Sport seeks to improve how it works and part of that involves professionalisation of the governing bodies and the employment by organisations of qualified coaches and youth and volunteer development officers, for example. Far from holding back good sporting activities, those people are helping to increase participation and to ensure that participants develop their potential to the full.
Of course, a strict interpretation of the term "amateur" would rule out clubs that use professional coaches and other professionals to develop their sports. That would have a negative effect on the future of sport in Scotland. It is right that such activities are allowed to continue and that we encourage sport in Scotland in that.
The term "amateur" is little used today. The Commonwealth Games Council for Scotland used to confine competition in games to amateur athletes, but that requirement has been removed. The Olympic movement, which was founded on amateur participation, has also reflected changes. The word "amateur" cannot be found in today's Olympic charter. The list of other sports professional bodies that have done likewise goes on.
If we are serious about helping Scottish sport to develop in the 21st century, we must reflect how sport in the 21st century operates and recognise the benefits of participation in sport. Removal of the term "amateur sport" to be replaced by the words "public participation in sport" would be a sensible and positive step forward, on which I thank sportscotland and the Scottish Sports Association for their support. I urge members to support amendment 47.
I advise members that, as little time is left to complete this group and the next group, I exercise my rights under rules 9.8.4A(c) and possibly (a) of standing orders to extend the timetable at the end of this section. Members should understand that if we do not make up the time on later groups, that will impact on the final debate on the bill.
The bill was amended at stage 2 to include a charitable purpose that would cover charities that are recognised under the Recreational Charities Act 1958. Amendments 3 to 5 respond to the concern that was expressed at stage 2 that that purpose was not broad enough to cover bodies that arrange recreational activities but do not own the grounds on which they take place. The deputy minister agreed that we would consider that further. Having done so, we believe that the purpose should be extended to include organising recreational activities as well as providing facilities.
Amendment 21, in the name of Scott Barrie, is similar to one that he lodged at stage 2. We support what he is trying to do and fully recognise the importance of non-formal education and youth work. The purpose of "the advancement of education" already covers all forms of education, including non-formal education through youth work, as proposed in the amendment. Many charities that have a wide range of education purposes are already charities under the current law, and we certainly intend that that will continue. We are concerned that referring to specific forms of education in the bill could lead to the inference that other forms of education are not included. That is not to detract from the value that we place on youth work or non-formal education; it is merely that we do not wish that purpose to be artificially restricted. I hope that I have reassured Scott Barrie that our intention is certainly not to prevent bodies that provide non-formal education and youth work from becoming charities. I fully support the role that they play and repeat that non-formal education and youth work are already covered by the purposes.
Amendments 2 and 48, in the name of Donald Gorrie, and amendment 47, in the name of Karen Whitefield, deal with the purpose of
"the advancement of amateur sport".
The inclusion of amateur sport as a charitable purpose originated as an extension of "the advancement of health" purpose. For that reason, the current definition of which types of sport are considered to be charitable purposes is the same as that in the bill as drafted. They are restricted to sports that involve "physical exertion and skill". We are opposed to amendment 48, which would change the wording to "physical exertion or skill" because physical exertion is integral to the link with healthy activity.
Will the minister clarify whether any amendment in the group might impact in any way on the charitable status of private sports clubs?
I am not aware that that is relevant. However, if information is available to me, I will obviously give it to members later.
The current provision would exclude sports such as chess, snooker or darts. Amendment 48 would allow those activities to be charitable under the sports purpose, and we want to resist the amendment because we are keen to maintain the link with the encouragement of healthy activity.
The word "amateur" was included in the purpose to reflect the fact that it is the promotion of sporting activity by the general public that makes sport charitable. We do not believe that the use of the word "amateur" bars a club from employing a professional to coach and play for a team, as long as that is done to advance amateur sport. We understand the arguments that have been made by sportscotland and others about the use of the word "amateur" being outmoded, but we do not believe that amendment 2, which would remove the word "amateur", is the whole answer. That would not mean that high-profile professional sports clubs could automatically be charities, as they would in any event be barred by the asset distribution test in section 7(3)(a), but it could allow bodies that promote or support such clubs to be charities. We do not believe that those bodies are, or should be, charities. Instead, we prefer the wording that is used in amendment 47, which is aimed more clearly at the reasons why sport is a charitable purpose—that is, it is as an extension of "the advancement of health" purpose and bodies that encourage the general public to get involved in sport should have charitable status.
I ask Scott Barrie to seek to withdraw amendment 21, Donald Gorrie not to move amendments 2 and 48, and members to support amendment 47, in the name of Karen Whitefield, and the Executive amendments.
Christine Grahame should make her comments very brief.
I will be terribly brief.
I cannot accept the minister's position with respect to amendment 48. I understand that snooker is a sport, but the physical exertion that is involved is tiny—men simply lean over a table and push a little ball about. Therefore, the word "or" is more appropriate than the word "and". [Interruption.] I cannot see the definition.
I would like members' attention again. My second point is on amendment 47. I have only a tiny amount of time to speak—I will then let another member say something. I have difficulties with Karen Whitefield's proposal that the purpose should be "public participation in sport". If a person stands and shouts their lungs out in the hope that Scotland will score a goal, that is public participation in sport in my book, but I would not say that it is a charitable purpose. The definition is slack. I was content with the "amateur sport" wording that we started with and to leave it to OSCR to decide whether there was too much professionalism and therefore whether something was no longer a charity.
I have considerable sympathy with amendment 47, which fits in well with the Executive's declared policy of encouraging more sports participation by the general public. However, will the minister tell us whether the removal of the word "amateur" might open up a loophole that some people might exploit? I accept that the lines between amateurism and professionalism are not as clearly defined as they used to be, but some sports clubs are professional by nature. For example, most senior football clubs are professional clubs and some are big business. Not many clubs, if any, make a handsome profit or pay a handsome dividend to their shareholders, but some pay out huge—in some cases excessive—amounts of money to their players. As I understand it, currently even a professional football club can set up a separate charitable trust for a charitable purpose, which might fall into any of the categories in section 7(2), such as the advancement of sport or the relief of poverty. However, I question whether the professional activities of such clubs should be allowed to have charitable status. I ask the minister to tell us whether amendment 47 might create a loophole in that regard, but apart from that I am very much in agreement with the spirit of amendment 47.
On the points that Christine Grahame and Dennis Canavan made, the important point that we should bear in mind is that amendment 47 was lodged in response to representations from the sporting community.
I listened to what the minister said about the value that the Executive places on youth work and other forms of non-formal education and I take on board his assurance that such areas will not be excluded from the definition of charitable purpose and that non-formal education will be fully encompassed by section 7(2)(b), which provides for the charitable purpose of "the advancement of education".
On that basis, I ask the Parliament's agreement to withdraw amendment 21.
On a point of order, Presiding Officer. I simply want to make the point that I do not recollect the suggestion being made by sportscotland to the Communities Committee.
That was not a point of order; it was an observation.
Amendment 21, by agreement, withdrawn.
Amendment 2 not moved.
Amendment 47 moved—[Karen Whitefield].
The question is, that amendment 47 be agreed to. Are we agreed?
No.
There will be a division.
For
Arbuckle, Mr Andrew (Mid Scotland and Fife) (LD)
Baillie, Jackie (Dumbarton) (Lab)
Baird, Shiona (North East Scotland) (Green)
Baker, Richard (North East Scotland) (Lab)
Ballance, Chris (South of Scotland) (Green)
Ballard, Mark (Lothians) (Green)
Barrie, Scott (Dunfermline West) (Lab)
Boyack, Sarah (Edinburgh Central) (Lab)
Brankin, Rhona (Midlothian) (Lab)
Brown, Robert (Glasgow) (LD)
Butler, Bill (Glasgow Anniesland) (Lab)
Byrne, Ms Rosemary (South of Scotland) (SSP)
Canavan, Dennis (Falkirk West) (Ind)
Chisholm, Malcolm (Edinburgh North and Leith) (Lab)
Craigie, Cathie (Cumbernauld and Kilsyth) (Lab)
Curran, Ms Margaret (Glasgow Baillieston) (Lab)
Deacon, Susan (Edinburgh East and Musselburgh) (Lab)
Eadie, Helen (Dunfermline East) (Lab)
Ferguson, Patricia (Glasgow Maryhill) (Lab)
Finnie, Ross (West of Scotland) (LD)
Fox, Colin (Lothians) (SSP)
Glen, Marlyn (North East Scotland) (Lab)
Godman, Trish (West Renfrewshire) (Lab)
Gorrie, Donald (Central Scotland) (LD)
Harper, Robin (Lothians) (Green)
Harvie, Patrick (Glasgow) (Green)
Henry, Hugh (Paisley South) (Lab)
Home Robertson, John (East Lothian) (Lab)
Hughes, Janis (Glasgow Rutherglen) (Lab)
Jackson, Dr Sylvia (Stirling) (Lab)
Jackson, Gordon (Glasgow Govan) (Lab)
Jamieson, Cathy (Carrick, Cumnock and Doon Valley) (Lab)
Jamieson, Margaret (Kilmarnock and Loudoun) (Lab)
Kerr, Mr Andy (East Kilbride) (Lab)
Lamont, Johann (Glasgow Pollok) (Lab)
Leckie, Carolyn (Central Scotland) (SSP)
Livingstone, Marilyn (Kirkcaldy) (Lab)
Lyon, George (Argyll and Bute) (LD)
Macdonald, Lewis (Aberdeen Central) (Lab)
Macintosh, Mr Kenneth (Eastwood) (Lab)
Maclean, Kate (Dundee West) (Lab)
Macmillan, Maureen (Highlands and Islands) (Lab)
Martin, Paul (Glasgow Springburn) (Lab)
May, Christine (Central Fife) (Lab)
McAveety, Mr Frank (Glasgow Shettleston) (Lab)
McCabe, Mr Tom (Hamilton South) (Lab)
McMahon, Michael (Hamilton North and Bellshill) (Lab)
McNeil, Mr Duncan (Greenock and Inverclyde) (Lab)
McNeill, Pauline (Glasgow Kelvin) (Lab)
Morrison, Mr Alasdair (Western Isles) (Lab)
Muldoon, Bristow (Livingston) (Lab)
Mulligan, Mrs Mary (Linlithgow) (Lab)
Munro, John Farquhar (Ross, Skye and Inverness West) (LD)
Murray, Dr Elaine (Dumfries) (Lab)
Oldfather, Irene (Cunninghame South) (Lab)
Peacock, Peter (Highlands and Islands) (Lab)
Peattie, Cathy (Falkirk East) (Lab)
Pringle, Mike (Edinburgh South) (LD)
Purvis, Jeremy (Tweeddale, Ettrick and Lauderdale) (LD)
Radcliffe, Nora (Gordon) (LD)
Robson, Euan (Roxburgh and Berwickshire) (LD)
Ruskell, Mr Mark (Mid Scotland and Fife) (Green)
Scott, Eleanor (Highlands and Islands) (Green)
Scott, Tavish (Shetland) (LD)
Smith, Elaine (Coatbridge and Chryston) (Lab)
Smith, Iain (North East Fife) (LD)
Smith, Margaret (Edinburgh West) (LD)
Stephen, Nicol (Aberdeen South) (LD)
Stone, Mr Jamie (Caithness, Sutherland and Easter Ross) (LD)
Turner, Dr Jean (Strathkelvin and Bearsden) (Ind)
Wallace, Mr Jim (Orkney) (LD)
Watson, Mike (Glasgow Cathcart) (Lab)
Whitefield, Karen (Airdrie and Shotts) (Lab)
Wilson, Allan (Cunninghame North) (Lab)
Against
Adam, Brian (Aberdeen North) (SNP)
Aitken, Bill (Glasgow) (Con)
Brocklebank, Mr Ted (Mid Scotland and Fife) (Con)
Crawford, Bruce (Mid Scotland and Fife) (SNP)
Cunningham, Roseanna (Perth) (SNP)
Davidson, Mr David (North East Scotland) (Con)
Douglas-Hamilton, Lord James (Lothians) (Con)
Ewing, Fergus (Inverness East, Nairn and Lochaber) (SNP)
Ewing, Mrs Margaret (Moray) (SNP)
Fabiani, Linda (Central Scotland) (SNP)
Fergusson, Alex (Galloway and Upper Nithsdale) (Con)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Gallie, Phil (South of Scotland) (Con)
Gibson, Rob (Highlands and Islands) (SNP)
Goldie, Miss Annabel (West of Scotland) (Con)
Grahame, Christine (South of Scotland) (SNP)
Hyslop, Fiona (Lothians) (SNP)
Ingram, Mr Adam (South of Scotland) (SNP)
Johnstone, Alex (North East Scotland) (Con)
MacAskill, Mr Kenny (Lothians) (SNP)
Marwick, Tricia (Mid Scotland and Fife) (SNP)
Mather, Jim (Highlands and Islands) (SNP)
Matheson, Michael (Central Scotland) (SNP)
Maxwell, Mr Stewart (West of Scotland) (SNP)
McFee, Mr Bruce (West of Scotland) (SNP)
McGrigor, Mr Jamie (Highlands and Islands) (Con)
McLetchie, David (Edinburgh Pentlands) (Con)
Milne, Mrs Nanette (North East Scotland) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Monteith, Mr Brian (Mid Scotland and Fife) (Con)
Morgan, Alasdair (South of Scotland) (SNP)
Neil, Alex (Central Scotland) (SNP)
Scanlon, Mary (Highlands and Islands) (Con)
Scott, John (Ayr) (Con)
Stevenson, Stewart (Banff and Buchan) (SNP)
Swinburne, John (Central Scotland) (SSCUP)
Swinney, Mr John (North Tayside) (SNP)
Welsh, Mr Andrew (Angus) (SNP)
White, Ms Sandra (Glasgow) (SNP)
The result of the division is: For 74, Against 39, Abstentions 0.
Amendment 47 agreed to.
Amendments 3 and 4 moved—[Malcolm Chisholm]—and agreed to.
Amendment 48 not moved.
Amendment 5 moved—[Malcolm Chisholm]—and agreed to.
Group 5 is on the charity test and excluded bodies. Amendment 49, in the name of Patrick Harvie, is grouped with amendments 50 to 52, 18 and 63. On this grouping I can allow only Patrick Harvie to speak and the minister to respond.
I will try to be quick. Like the other amendments that I have lodged, my amendments in the group originate from the Scottish Council for Voluntary Organisations, which is the representative body of the charitable and voluntary sector in Scotland. My amendments cover three broad issues. I expect some of them to be resisted as the arguments have been rehearsed previously, but I hope that some of them will elicit a little more sympathy.
Amendment 49 would change the charity test in one small way in that a body would fail the charity test if its income or property—rather than its property alone—were distributed, or if its constitution allowed for its income or property to be distributed. The amendment would provide an additional safeguard and I hope that it will be seen as a constructive addition to the bill.
Amendments 50 and 51 are about the principle of independence. It is important to note that in general the bill has managed to achieve a central place for the idea that charities are independent. The bill has managed to preserve that principle, but certain aspects of the provisions could be improved. Independence for charities should mean independence from government at all levels. Amendment 50 would add local authorities, so that if charities were under the direct control of local authorities, that situation would have to change. It seems no more reasonable that local authorities should control an organisation that has charitable status than that other levels of government should do so. It is important to note that the amendment would not change the power of ministers to exempt certain categories, so that where councils would be unable to continue to provide a certain level of services if charitable status were lost, the matter could be addressed through ministerial order.
Amendment 51 deals not with direct control but with the appointment of trustees. The argument will be familiar to those who have been involved in the consideration of the bill. The idea comes from the original McFadden report recommendation that no more than a third of trustees should be appointed by public bodies. I do not expect any last-minute conversions on the issue, but I feel that the point of principle about public appointments undermining the independence of charities should be aired in our debate today. I look forward to hearing the minister's comments.
Finally, amendment 52 is about the disposal of property. The amendment reflects an important principle. It would ensure that property that may have been given to an organisation specifically because it had charitable status should not be distributed to non-charitable bodies. The SCVO has expressed serious concerns about the ministerial power on the issue and I am happy to give voice to those concerns in the chamber.
I move amendment 49.
Presiding Officer, this is a series of significant amendments so, although I shall try to speak at a canter, I hope that you will allow me leeway to make the points that need to be made.
Amendment 18 ensures that ministers can alter any enactment for the purposes of preventing a body from failing the charity test because its constitution allows asset distribution for a non-charitable purpose, as set out in section 7(3)(a), as well as because its constitution allows ministers to control its activities, as set out in section 7(3)(b). That will allow ministers to remove or alter any power in an enactment that allows a body to distribute its assets for a non-charitable purpose and will therefore allow it to meet the charity test.
Section 7(3)(a) prevents a body with a constitution that allows it to distribute or otherwise apply any of its property from being a charity. Amendment 49 would add to that section any income as defined under paragraphs (a) to (c) of section 19(1). That is unnecessary as the definition of property already includes any income the body receives. The addition of a separate reference to income in section 7 could cast doubt on what is meant by property elsewhere in the bill.
Section 19 includes a specific reference to the type of property that is subject to the section, because it is intended to ring fence the charitable assets and any income accrued from charitable assets of a body that is removed from the register, so that they can continue to be used for charitable purposes, and to exclude assets acquired after the body ceased to be charitable. That provision is not relevant to section 7. Any income received by a charity would automatically become the property of the charity and would be a charitable asset, so property does not need to be defined in the same way.
Patrick Harvie is right to say that there is an important debate to be had on the issue of independence and its significance to the sector. Amendment 50 would mean that a body would fail the charity test if a local authority had a power of direction over it. We believe that the independence of such bodies at local level is best assured by the trustee duties to act in the interest of the charity. Those will be strengthened if the Parliament agrees to amendment 57, in the name of Donald Gorrie, which deals with conflicts of interest.
Amendment 51 reflects the recommendation in the McFadden report that only a third of a charity's trustees should be allowed to be appointed by a third party. We have always argued and—Patrick Harvie may not be surprised to note—we continue to believe that what is important is not how a charity trustee is appointed but how they behave once in position. Amendment 57 provides further reassurance that if a conflict of interest arises, a trustee should put the interests of the charity first or refrain from taking part in any discussion or decision.
Amendment 52 would prevent ministers from exempting bodies from the asset distribution test that I have outlined. The amendment would prevent the five national collections non-departmental public bodies from remaining charities. During discussions of the status of those bodies at stage 1, it was argued that charitable status was extremely important to them and to Scotland, and that it should be protected. It was also argued that, because of the national importance of the collections that they hold, control of those collections should remain in the hands of ministers. The constitutions of the bodies provide that, if they cease to exist, their assets revert to ministers. That provides valuable protection, ensuring that nationally important collections remain in the hands of the nation. We would resist any change to the provision.
Amendment 52 would prevent the five bodies from retaining their status as charities. If amendment 51 is not agreed to, amendment 52 will fall. However if amendment 51 is agreed to and amendment 52 is not, some of the five national collections bodies will fail the test, because ministers appoint their trustees.
Amendment 63 would insert in section 103 a definition of a public body. The only references in the bill to public bodies relate to co-operation in section 20 and information-sharing powers in section 24. The definition that is set out in the amendment could cause problems for the operation of those sections, as it would exclude any public body established by enactment, including many regulators that also oversee charities, such as the Scottish further and higher education funding council and the care commission. OSCR itself would not be included in the definition.
I have two further points to make about independence. First, direction at ministerial level is enshrined in law, so it is distinct from local authority powers of direction. Secondly, any exemption that is applied by ministers will be subject to affirmative decision by the Parliament. I hope that that gives members the comfort that they seek. Clearly, this is an issue that has exercised members' minds from the bill's early stages.
I ask Patrick Harvie to withdraw amendment 49 and not to move the other amendments in his name. I ask the chamber to support amendment 18.
Mr Harvie, there is no time for you to do anything other than indicate whether you intend to press or to seek leave to withdraw amendment 49.
Given the minister's explicit assurance that income is covered, I seek permission to withdraw amendment 49.
Amendment 49, by agreement, withdrawn.
Amendment 50 moved—[Patrick Harvie].
The question is, that amendment 50 be agreed to. Are we agreed?
No.
There will be a division.
For
Adam, Brian (Aberdeen North) (SNP)
Baird, Shiona (North East Scotland) (Green)
Ballance, Chris (South of Scotland) (Green)
Ballard, Mark (Lothians) (Green)
Byrne, Ms Rosemary (South of Scotland) (SSP)
Crawford, Bruce (Mid Scotland and Fife) (SNP)
Cunningham, Roseanna (Perth) (SNP)
Ewing, Fergus (Inverness East, Nairn and Lochaber) (SNP)
Ewing, Mrs Margaret (Moray) (SNP)
Fabiani, Linda (Central Scotland) (SNP)
Fox, Colin (Lothians) (SSP)
Gibson, Rob (Highlands and Islands) (SNP)
Grahame, Christine (South of Scotland) (SNP)
Harper, Robin (Lothians) (Green)
Harvie, Patrick (Glasgow) (Green)
Hyslop, Fiona (Lothians) (SNP)
Ingram, Mr Adam (South of Scotland) (SNP)
Leckie, Carolyn (Central Scotland) (SSP)
MacAskill, Mr Kenny (Lothians) (SNP)
Marwick, Tricia (Mid Scotland and Fife) (SNP)
Matheson, Michael (Central Scotland) (SNP)
Maxwell, Mr Stewart (West of Scotland) (SNP)
McFee, Mr Bruce (West of Scotland) (SNP)
Morgan, Alasdair (South of Scotland) (SNP)
Neil, Alex (Central Scotland) (SNP)
Ruskell, Mr Mark (Mid Scotland and Fife) (Green)
Scott, Eleanor (Highlands and Islands) (Green)
Stevenson, Stewart (Banff and Buchan) (SNP)
Sturgeon, Nicola (Glasgow) (SNP)
Swinburne, John (Central Scotland) (SSCUP)
Swinney, Mr John (North Tayside) (SNP)
Turner, Dr Jean (Strathkelvin and Bearsden) (Ind)
Welsh, Mr Andrew (Angus) (SNP)
White, Ms Sandra (Glasgow) (SNP)
Against
Aitken, Bill (Glasgow) (Con)
Arbuckle, Mr Andrew (Mid Scotland and Fife) (LD)
Baillie, Jackie (Dumbarton) (Lab)
Baker, Richard (North East Scotland) (Lab)
Barrie, Scott (Dunfermline West) (Lab)
Boyack, Sarah (Edinburgh Central) (Lab)
Brankin, Rhona (Midlothian) (Lab)
Brocklebank, Mr Ted (Mid Scotland and Fife) (Con)
Brown, Robert (Glasgow) (LD)
Butler, Bill (Glasgow Anniesland) (Lab)
Canavan, Dennis (Falkirk West) (Ind)
Chisholm, Malcolm (Edinburgh North and Leith) (Lab)
Craigie, Cathie (Cumbernauld and Kilsyth) (Lab)
Curran, Ms Margaret (Glasgow Baillieston) (Lab)
Davidson, Mr David (North East Scotland) (Con)
Deacon, Susan (Edinburgh East and Musselburgh) (Lab)
Douglas-Hamilton, Lord James (Lothians) (Con)
Eadie, Helen (Dunfermline East) (Lab)
Ferguson, Patricia (Glasgow Maryhill) (Lab)
Fergusson, Alex (Galloway and Upper Nithsdale) (Con)
Finnie, Ross (West of Scotland) (LD)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Gallie, Phil (South of Scotland) (Con)
Glen, Marlyn (North East Scotland) (Lab)
Godman, Trish (West Renfrewshire) (Lab)
Goldie, Miss Annabel (West of Scotland) (Con)
Gorrie, Donald (Central Scotland) (LD)
Henry, Hugh (Paisley South) (Lab)
Home Robertson, John (East Lothian) (Lab)
Hughes, Janis (Glasgow Rutherglen) (Lab)
Jackson, Dr Sylvia (Stirling) (Lab)
Jackson, Gordon (Glasgow Govan) (Lab)
Jamieson, Cathy (Carrick, Cumnock and Doon Valley) (Lab)
Jamieson, Margaret (Kilmarnock and Loudoun) (Lab)
Johnstone, Alex (North East Scotland) (Con)
Kerr, Mr Andy (East Kilbride) (Lab)
Lamont, Johann (Glasgow Pollok) (Lab)
Livingstone, Marilyn (Kirkcaldy) (Lab)
Lyon, George (Argyll and Bute) (LD)
Macdonald, Lewis (Aberdeen Central) (Lab)
Macintosh, Mr Kenneth (Eastwood) (Lab)
Maclean, Kate (Dundee West) (Lab)
Macmillan, Maureen (Highlands and Islands) (Lab)
Martin, Paul (Glasgow Springburn) (Lab)
May, Christine (Central Fife) (Lab)
McAveety, Mr Frank (Glasgow Shettleston) (Lab)
McCabe, Mr Tom (Hamilton South) (Lab)
McGrigor, Mr Jamie (Highlands and Islands) (Con)
McLetchie, David (Edinburgh Pentlands) (Con)
McMahon, Michael (Hamilton North and Bellshill) (Lab)
McNeil, Mr Duncan (Greenock and Inverclyde) (Lab)
McNeill, Pauline (Glasgow Kelvin) (Lab)
McNulty, Des (Clydebank and Milngavie) (Lab)
Milne, Mrs Nanette (North East Scotland) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Monteith, Mr Brian (Mid Scotland and Fife) (Con)
Morrison, Mr Alasdair (Western Isles) (Lab)
Muldoon, Bristow (Livingston) (Lab)
Mulligan, Mrs Mary (Linlithgow) (Lab)
Munro, John Farquhar (Ross, Skye and Inverness West) (LD)
Murray, Dr Elaine (Dumfries) (Lab)
Oldfather, Irene (Cunninghame South) (Lab)
Peacock, Peter (Highlands and Islands) (Lab)
Peattie, Cathy (Falkirk East) (Lab)
Pringle, Mike (Edinburgh South) (LD)
Purvis, Jeremy (Tweeddale, Ettrick and Lauderdale) (LD)
Radcliffe, Nora (Gordon) (LD)
Robson, Euan (Roxburgh and Berwickshire) (LD)
Scanlon, Mary (Highlands and Islands) (Con)
Scott, John (Ayr) (Con)
Scott, Tavish (Shetland) (LD)
Smith, Elaine (Coatbridge and Chryston) (Lab)
Smith, Iain (North East Fife) (LD)
Smith, Margaret (Edinburgh West) (LD)
Stephen, Nicol (Aberdeen South) (LD)
Stone, Mr Jamie (Caithness, Sutherland and Easter Ross) (LD)
Wallace, Mr Jim (Orkney) (LD)
Watson, Mike (Glasgow Cathcart) (Lab)
Whitefield, Karen (Airdrie and Shotts) (Lab)
Wilson, Allan (Cunninghame North) (Lab)
The Deputy Presiding Officer: The result of the division is: For 34, Against 80, Abstentions 0.
Amendment 50 disagreed to.
I hope that, while the clock was running down during that division, Mr Harvie was considering his plans for amendments 51 and 52. Mr Harvie, will you be moving amendment 51?
I am afraid so.
Amendment 51 moved—[Patrick Harvie].
The question is, that amendment 51 be agreed to. Are we agreed?
No.
There will be a division.
For
Baird, Shiona (North East Scotland) (Green)
Ballance, Chris (South of Scotland) (Green)
Ballard, Mark (Lothians) (Green)
Byrne, Ms Rosemary (South of Scotland) (SSP)
Fox, Colin (Lothians) (SSP)
Harper, Robin (Lothians) (Green)
Harvie, Patrick (Glasgow) (Green)
Leckie, Carolyn (Central Scotland) (SSP)
Ruskell, Mr Mark (Mid Scotland and Fife) (Green)
Scott, Eleanor (Highlands and Islands) (Green)
Against
Adam, Brian (Aberdeen North) (SNP)
Aitken, Bill (Glasgow) (Con)
Arbuckle, Mr Andrew (Mid Scotland and Fife) (LD)
Baillie, Jackie (Dumbarton) (Lab)
Baker, Richard (North East Scotland) (Lab)
Barrie, Scott (Dunfermline West) (Lab)
Boyack, Sarah (Edinburgh Central) (Lab)
Brankin, Rhona (Midlothian) (Lab)
Brocklebank, Mr Ted (Mid Scotland and Fife) (Con)
Brown, Robert (Glasgow) (LD)
Butler, Bill (Glasgow Anniesland) (Lab)
Canavan, Dennis (Falkirk West) (Ind)
Chisholm, Malcolm (Edinburgh North and Leith) (Lab)
Craigie, Cathie (Cumbernauld and Kilsyth) (Lab)
Crawford, Bruce (Mid Scotland and Fife) (SNP)
Cunningham, Roseanna (Perth) (SNP)
Curran, Ms Margaret (Glasgow Baillieston) (Lab)
Davidson, Mr David (North East Scotland) (Con)
Deacon, Susan (Edinburgh East and Musselburgh) (Lab)
Douglas-Hamilton, Lord James (Lothians) (Con)
Eadie, Helen (Dunfermline East) (Lab)
Ewing, Fergus (Inverness East, Nairn and Lochaber) (SNP)
Ewing, Mrs Margaret (Moray) (SNP)
Fabiani, Linda (Central Scotland) (SNP)
Ferguson, Patricia (Glasgow Maryhill) (Lab)
Fergusson, Alex (Galloway and Upper Nithsdale) (Con)
Finnie, Ross (West of Scotland) (LD)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Gallie, Phil (South of Scotland) (Con)
Gibson, Rob (Highlands and Islands) (SNP)
Glen, Marlyn (North East Scotland) (Lab)
Godman, Trish (West Renfrewshire) (Lab)
Goldie, Miss Annabel (West of Scotland) (Con)
Gorrie, Donald (Central Scotland) (LD)
Grahame, Christine (South of Scotland) (SNP)
Henry, Hugh (Paisley South) (Lab)
Home Robertson, John (East Lothian) (Lab)
Hughes, Janis (Glasgow Rutherglen) (Lab)
Hyslop, Fiona (Lothians) (SNP)
Ingram, Mr Adam (South of Scotland) (SNP)
Jackson, Dr Sylvia (Stirling) (Lab)
Jackson, Gordon (Glasgow Govan) (Lab)
Jamieson, Cathy (Carrick, Cumnock and Doon Valley) (Lab)
Jamieson, Margaret (Kilmarnock and Loudoun) (Lab)
Johnstone, Alex (North East Scotland) (Con)
Kerr, Mr Andy (East Kilbride) (Lab)
Lamont, Johann (Glasgow Pollok) (Lab)
Livingstone, Marilyn (Kirkcaldy) (Lab)
Lyon, George (Argyll and Bute) (LD)
MacAskill, Mr Kenny (Lothians) (SNP)
Macdonald, Lewis (Aberdeen Central) (Lab)
Macintosh, Mr Kenneth (Eastwood) (Lab)
Maclean, Kate (Dundee West) (Lab)
Macmillan, Maureen (Highlands and Islands) (Lab)
Martin, Paul (Glasgow Springburn) (Lab)
Marwick, Tricia (Mid Scotland and Fife) (SNP)
Mather, Jim (Highlands and Islands) (SNP)
Matheson, Michael (Central Scotland) (SNP)
Maxwell, Mr Stewart (West of Scotland) (SNP)
May, Christine (Central Fife) (Lab)
McAveety, Mr Frank (Glasgow Shettleston) (Lab)
McCabe, Mr Tom (Hamilton South) (Lab)
McFee, Mr Bruce (West of Scotland) (SNP)
McGrigor, Mr Jamie (Highlands and Islands) (Con)
McLetchie, David (Edinburgh Pentlands) (Con)
McMahon, Michael (Hamilton North and Bellshill) (Lab)
McNeil, Mr Duncan (Greenock and Inverclyde) (Lab)
McNeill, Pauline (Glasgow Kelvin) (Lab)
McNulty, Des (Clydebank and Milngavie) (Lab)
Milne, Mrs Nanette (North East Scotland) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Monteith, Mr Brian (Mid Scotland and Fife) (Con)
Morgan, Alasdair (South of Scotland) (SNP)
Morrison, Mr Alasdair (Western Isles) (Lab)
Muldoon, Bristow (Livingston) (Lab)
Mulligan, Mrs Mary (Linlithgow) (Lab)
Munro, John Farquhar (Ross, Skye and Inverness West) (LD)
Murray, Dr Elaine (Dumfries) (Lab)
Neil, Alex (Central Scotland) (SNP)
Oldfather, Irene (Cunninghame South) (Lab)
Peacock, Peter (Highlands and Islands) (Lab)
Peattie, Cathy (Falkirk East) (Lab)
Pringle, Mike (Edinburgh South) (LD)
Purvis, Jeremy (Tweeddale, Ettrick and Lauderdale) (LD)
Radcliffe, Nora (Gordon) (LD)
Robson, Euan (Roxburgh and Berwickshire) (LD)
Scanlon, Mary (Highlands and Islands) (Con)
Scott, John (Ayr) (Con)
Scott, Tavish (Shetland) (LD)
Smith, Elaine (Coatbridge and Chryston) (Lab)
Smith, Iain (North East Fife) (LD)
Smith, Margaret (Edinburgh West) (LD)
Stephen, Nicol (Aberdeen South) (LD)
Stevenson, Stewart (Banff and Buchan) (SNP)
Stone, Mr Jamie (Caithness, Sutherland and Easter Ross) (LD)
Sturgeon, Nicola (Glasgow) (SNP)
Swinburne, John (Central Scotland) (SSCUP)
Swinney, Mr John (North Tayside) (SNP)
Wallace, Mr Jim (Orkney) (LD)
Watson, Mike (Glasgow Cathcart) (Lab)
Welsh, Mr Andrew (Angus) (SNP)
White, Ms Sandra (Glasgow) (SNP)
Whitefield, Karen (Airdrie and Shotts) (Lab)
Wilson, Allan (Cunninghame North) (Lab)
Abstentions
Turner, Dr Jean (Strathkelvin and Bearsden) (Ind)
The result of the division is: For 10, Against 104, Abstentions 1.
Amendment 51 disagreed to.
Amendment 52 not moved.
Thank you, Mr Harvie. Let us be grateful for small mercies. [Laughter.] When I said that, I was thinking only about the timetable.
Section 8—Public benefit
Group 6 is headed "Charity test—public benefit". Amendment 53, in the name of Mary Scanlon, is grouped with amendment 54.
With amendment 53, I seek to delete the words
"including any charge or fee",
which were inserted by an amendment moved by John Home Robertson at stage 2. Throughout the bill's progress, I have raised concerns over the phrase "unduly restrictive" in relation to public benefit. Many witnesses, including from OSCR, have explained how the term is likely to be interpreted. That has given some reassurance, although the phrase "unduly restrictive" is open to wide and variable interpretation. However, I have no doubt that the meaning will become enshrined in law as precedents are set.
The advancement of education is enshrined in a 1601 statute as a charitable purpose. There is no need for secondary justification for tax purposes. However, the addition of the words "any charge or fee" over and above "unduly restrictive" is a step too far.
The issue behind John Home Robertson's amendment was independent schools. It is surely for parents to decide whether they wish to make financial sacrifices to pay for their children's education on top of what they pay in income tax and council tax; it is surely for parents—not politicians or the Office of the Scottish Charity Regulator—to decide whether they are getting value for money.
All independent schools operate on a not-for-profit basis. Any revenue surpluses are ploughed back into investment in the provision of high-quality education, so how can OSCR say that a fee is too high? How can OSCR decide whether the education of our children is too high quality? If the overheads of some of our old independent schools, in their historic buildings and grounds, require a higher fee, it is surely for the parents to decide whether the money is worth paying. We are talking about the one chance that every parent gets to educate their child.
Section 8 challenges the basic tenet of individuals to exercise freedom of choice on how much of their own money they wish to spend and how they wish to spend it—whether it be on their children's education or to pay for treatment in an independent hospital. The inclusion of section 8 brings the politics of envy and not the politics of reason. The end result could be the loss of charitable status for tax purposes. Fees would have to be raised by up to 5 per cent, meaning that there would be less money to pay for bursaries to support those from less well-off families. The result would be elitism and exclusion, not the choice and inclusion that we have at present.
Independent schools should be deemed as charities, as they save the taxpayer £150 million a year. They contribute hugely to the quality of Scottish education and Scottish life. They cannot be deemed to be "unduly restrictive" on the basis of a charge or a fee. As I said, the advancement of education is a charitable purpose and requires no secondary justification. All surplus income is reinvested into serving pupils with the best education.
Inland Revenue issues are the responsibility of the Westminster Parliament. Amendment 53 refers to the loss of rates relief and anything else that relates to the Scottish Parliament.
I move amendment 53.
There are two separate issues and my amendment 54 tries to tease out what counts as "unduly restrictive". I shall be interested in what ministers have to say in response and I would like them to give assurances on the points that I raise.
A housing association clearly benefits its tenants, but it could be argued that it does not provide public benefit. Similarly, it could be argued that a faith charity that is restricted to members of that faith is "unduly restrictive". It could also be argued that a regimental association or a former pupils association was "unduly restrictive". I think that all those organisations can be genuine charities and can benefit the community. Amendment 54 says that an organisation can be a bona fide charity if its membership is restricted but it benefits the people in the group that it is supposed to benefit and does not discriminate unfairly between them, especially if
"the community as a whole benefits directly or indirectly".
Various people have criticised the wording of the amendment, as they always do, but I think that the idea behind it is important and I hope that the minister will make it clear that, even without amendment 54, "unduly restrictive" will be interpreted in a reasonable fashion.
I turn to amendment 53, in the name of Mary Scanlon. I supported John Home Robertson's amendment at stage 2, because the issue goes wider than fee-paying schools and covers a whole range of organisations, clubs, societies and associations. For example, a golf club that charges a modest fee and operates as a community enterprise can be a bona fide charity. However, a golf club that charges high fees and might not allow people in would not, in my view, be a charity, although running such a club is a perfectly respectable activity. The level of charges is a legitimate point for OSCR to take into account.
The issue of fee-paying schools has aerated some people in the press. It is worth making it clear to members that the Inland Revenue is a United Kingdom enterprise and tries to run things on a level playing field across the UK. The procedures of the Inland Revenue, as supported by legal judgments in the past, are such that, where there is a diversion between Scottish law and English law, English law is followed. Therefore, if by any remote chance OSCR were to interpret the bill as indicating that some fee-paying schools did not provide public benefit—and that is up to OSCR's chief executive and her colleagues—so long as the Westminster law, as interpreted by the Charity Commission for England and Wales, accepted fee-paying schools as charities, the Inland Revenue would go with the English decision.
People should not get too excited about the subject. A lot of people in the fee-paying sector genuinely feel that they can demonstrate a public benefit and I feel that there is no risk of their losing charitable status, but that is up to OSCR. We are trying to supply an independent organisation with sensible rules and I believe that we are achieving that.
If the minister says the right things, I will not press amendment 54, but I shall certainly vote against amendment 53.
I call John Home Robertson, to be followed by Christine Grahame, but I can give you only a minute each.
That is disappointing.
I have been accused of many things in my life, but never before have I been accused of indulging in the politics of envy. Amendment 53 would delete the change that was made by the amendment that I moved at stage 2 on 20 April, which was agreed to by eight votes to one. The single vote against it was Mary Scanlon's. My amendment sought to make crystal clear the meaning of the public benefit test in section 8. I wanted to emphasise that public benefit means just that—benefit to the public, not benefit that is restricted to people who can afford to purchase a particular service. The provision of benefits for financially exclusive groups of people is not what any reasonable person would recognise as a public benefit. As amended at stage 2, section 8 sets a realistic and fair test for OSCR, the independent regulator, to apply. The same test will apply to all charitable organisations, not just schools.
I read in today's press that some people are already looking for loopholes that might enable organisations that do not pass the public benefit test—and therefore do not satisfy the criteria for registration as Scottish charities—to get charitable tax relief. That would be an absurd state of affairs, but it raises bigger questions for the Inland Revenue than it does for us. It might be a useful start to establish that Musselburgh Grammar School, which is genuinely a public school, should not have to pay more rates than Loretto School, which is not quite so public, as is the case at present.
My former colleagues at Westminster are about to resume their consideration of the charities legislation for the rest of the United Kingdom. I suggest that they would do well to adopt the sound principle that we are establishing on the basis of wide political and public consensus here in Scotland. I urge the Parliament to reject amendment 53.
We need a little more light and a little less heat. Section 8 applies not just to independent schools, but to a wide spectrum of organisations, of which private hospitals and sports clubs are just two examples. The issue is proportionality. The test is whether the payment made is so great that it is unduly restrictive, which means that the organisation that charges the fee is not inclusive. That is a matter not for the Parliament, but for OSCR.
Mention has been made of the Inland Revenue. I understand that, as Donald Gorrie highlighted, the Inland Revenue will completely ignore the position that OSCR takes on charitable status in that it will treat organisations that have been disarmed of charitable status as if they were charities. I think that that is something to get excited about. It makes me despair when Westminster is prepared to override the will of the Scottish Parliament to do something for Scotland. That is not a constitutional point; it is a fact.
You must finish now.
The only reason why I feel that amendment 54 cannot be supported is that its use of the phrase "directly or indirectly" in paragraph (c) of the subsection that it seeks to insert is very woolly.
I ask the minister to be brief.
I will be as brief as I can.
Since the bill was introduced, an attempt has been made to turn its passage into an argument about people's views on a particular part of the independent sector, which of course is highly diverse. That is not what the bill is about. The issue of how people choose to spend their money on their children would be more appropriate to raise in a debate about education. We are talking about the regulation of charities and those organisations that are entitled to call themselves charities.
Amendment 53 seeks to reverse an amendment that was made at stage 2. It would remove the reference in the public benefit test that highlights the fact that, in deciding whether a body provides public benefit, OSCR can consider whether any charge or fee is unduly restrictive. The Executive did not object to that amendment at stage 2 because it did not alter the public benefit test. It was always intended that OSCR would be able to consider charging as part of the test and the amendment made that clear in the bill. That does not mean that a body will automatically fail the test because it charges a fee, but OSCR will have to have regard to that issue.
I hope that I can reassure all charities that charging a fee so that access is granted to services will not automatically prevent bodies from being deemed as charities. Whether charitable status is granted will depend on individual circumstances and OSCR will consider each body on a case-by-case basis.
Amendment 54 is intended to address an issue that Donald Gorrie raised at stage 2. He seeks to clarify that the public benefit test does not prevent a body that is targeted at specific groups from being deemed as charitable. I assure him that, as it stands, the bill does not prevent that. That is made clear by the fact that the public benefit provision refers specifically to circumstances in which the benefit is provided only to a section of the public.
Although I have no difficulty in offering reassurance on the point, I have some concern about the possible impact of amendment 54 as drafted. Because it outlines which conditions should never be considered as unduly restrictive, OSCR could find itself unable to deny charitable status to bodies with a discriminatory membership condition that would otherwise have been considered to be unduly restrictive. Moreover, some membership bodies that charge different rates for students or older people, for example, might be viewed under the provision as discriminating between members.
As I said, the public benefit test as it stands will include those bodies that are targeted at specific groups. I hope that what I have said will reassure Donald Gorrie. On that basis and because of the possible problems that I have highlighted, I ask him not to move amendment 54.
I emphasise that at the heart of the purpose of the public benefit test is the desire to give confidence to the charitable sector and to those who wish to give of their time and money. There is no presumption against or in favour of any group. Equally, any group that seeks charitable status should be able to establish public benefit. I am confident that OSCR, as an independent regulator, can take a rational, dispassionate and objective view of these matters. I believe that the public benefit test, as identified in the bill, gives sufficient guidance on the matter.
As we have run out of time, I ask Mary Scanlon whether she wants to press or withdraw amendment 53.
I would like to press amendment 53.
The question is, that amendment 53 be agreed to. Are we agreed?
No.
There will be a division.
For
Aitken, Bill (Glasgow) (Con)
Brocklebank, Mr Ted (Mid Scotland and Fife) (Con)
Davidson, Mr David (North East Scotland) (Con)
Douglas-Hamilton, Lord James (Lothians) (Con)
Fergusson, Alex (Galloway and Upper Nithsdale) (Con)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Gallie, Phil (South of Scotland) (Con)
Goldie, Miss Annabel (West of Scotland) (Con)
Johnstone, Alex (North East Scotland) (Con)
McGrigor, Mr Jamie (Highlands and Islands) (Con)
McLetchie, David (Edinburgh Pentlands) (Con)
Milne, Mrs Nanette (North East Scotland) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Monteith, Mr Brian (Mid Scotland and Fife) (Con)
Scanlon, Mary (Highlands and Islands) (Con)
Scott, John (Ayr) (Con)
Tosh, Murray (West of Scotland) (Con)
Against
Adam, Brian (Aberdeen North) (SNP)
Arbuckle, Mr Andrew (Mid Scotland and Fife) (LD)
Baillie, Jackie (Dumbarton) (Lab)
Baird, Shiona (North East Scotland) (Green)
Baker, Richard (North East Scotland) (Lab)
Ballance, Chris (South of Scotland) (Green)
Ballard, Mark (Lothians) (Green)
Barrie, Scott (Dunfermline West) (Lab)
Boyack, Sarah (Edinburgh Central) (Lab)
Brankin, Rhona (Midlothian) (Lab)
Brown, Robert (Glasgow) (LD)
Butler, Bill (Glasgow Anniesland) (Lab)
Byrne, Ms Rosemary (South of Scotland) (SSP)
Canavan, Dennis (Falkirk West) (Ind)
Chisholm, Malcolm (Edinburgh North and Leith) (Lab)
Craigie, Cathie (Cumbernauld and Kilsyth) (Lab)
Crawford, Bruce (Mid Scotland and Fife) (SNP)
Cunningham, Roseanna (Perth) (SNP)
Curran, Ms Margaret (Glasgow Baillieston) (Lab)
Deacon, Susan (Edinburgh East and Musselburgh) (Lab)
Eadie, Helen (Dunfermline East) (Lab)
Ewing, Fergus (Inverness East, Nairn and Lochaber) (SNP)
Ewing, Mrs Margaret (Moray) (SNP)
Fabiani, Linda (Central Scotland) (SNP)
Ferguson, Patricia (Glasgow Maryhill) (Lab)
Finnie, Ross (West of Scotland) (LD)
Fox, Colin (Lothians) (SSP)
Gibson, Rob (Highlands and Islands) (SNP)
Glen, Marlyn (North East Scotland) (Lab)
Gorrie, Donald (Central Scotland) (LD)
Grahame, Christine (South of Scotland) (SNP)
Harper, Robin (Lothians) (Green)
Harvie, Patrick (Glasgow) (Green)
Henry, Hugh (Paisley South) (Lab)
Home Robertson, John (East Lothian) (Lab)
Hughes, Janis (Glasgow Rutherglen) (Lab)
Hyslop, Fiona (Lothians) (SNP)
Ingram, Mr Adam (South of Scotland) (SNP)
Jackson, Dr Sylvia (Stirling) (Lab)
Jackson, Gordon (Glasgow Govan) (Lab)
Jamieson, Cathy (Carrick, Cumnock and Doon Valley) (Lab)
Jamieson, Margaret (Kilmarnock and Loudoun) (Lab)
Kerr, Mr Andy (East Kilbride) (Lab)
Lamont, Johann (Glasgow Pollok) (Lab)
Leckie, Carolyn (Central Scotland) (SSP)
Livingstone, Marilyn (Kirkcaldy) (Lab)
Lyon, George (Argyll and Bute) (LD)
MacAskill, Mr Kenny (Lothians) (SNP)
Macdonald, Lewis (Aberdeen Central) (Lab)
Macintosh, Mr Kenneth (Eastwood) (Lab)
Maclean, Kate (Dundee West) (Lab)
Macmillan, Maureen (Highlands and Islands) (Lab)
Martin, Paul (Glasgow Springburn) (Lab)
Marwick, Tricia (Mid Scotland and Fife) (SNP)
Mather, Jim (Highlands and Islands) (SNP)
Matheson, Michael (Central Scotland) (SNP)
Maxwell, Mr Stewart (West of Scotland) (SNP)
May, Christine (Central Fife) (Lab)
McAveety, Mr Frank (Glasgow Shettleston) (Lab)
McCabe, Mr Tom (Hamilton South) (Lab)
McFee, Mr Bruce (West of Scotland) (SNP)
McMahon, Michael (Hamilton North and Bellshill) (Lab)
McNeil, Mr Duncan (Greenock and Inverclyde) (Lab)
McNeill, Pauline (Glasgow Kelvin) (Lab)
McNulty, Des (Clydebank and Milngavie) (Lab)
Morgan, Alasdair (South of Scotland) (SNP)
Morrison, Mr Alasdair (Western Isles) (Lab)
Muldoon, Bristow (Livingston) (Lab)
Mulligan, Mrs Mary (Linlithgow) (Lab)
Munro, John Farquhar (Ross, Skye and Inverness West) (LD)
Murray, Dr Elaine (Dumfries) (Lab)
Neil, Alex (Central Scotland) (SNP)
Oldfather, Irene (Cunninghame South) (Lab)
Peacock, Peter (Highlands and Islands) (Lab)
Peattie, Cathy (Falkirk East) (Lab)
Pringle, Mike (Edinburgh South) (LD)
Purvis, Jeremy (Tweeddale, Ettrick and Lauderdale) (LD)
Radcliffe, Nora (Gordon) (LD)
Robson, Euan (Roxburgh and Berwickshire) (LD)
Ruskell, Mr Mark (Mid Scotland and Fife) (Green)
Scott, Eleanor (Highlands and Islands) (Green)
Scott, Tavish (Shetland) (LD)
Smith, Elaine (Coatbridge and Chryston) (Lab)
Smith, Iain (North East Fife) (LD)
Smith, Margaret (Edinburgh West) (LD)
Stephen, Nicol (Aberdeen South) (LD)
Stevenson, Stewart (Banff and Buchan) (SNP)
Stone, Mr Jamie (Caithness, Sutherland and Easter Ross) (LD)
Sturgeon, Nicola (Glasgow) (SNP)
Swinburne, John (Central Scotland) (SSCUP)
Swinney, Mr John (North Tayside) (SNP)
Turner, Dr Jean (Strathkelvin and Bearsden) (Ind)
Wallace, Mr Jim (Orkney) (LD)
Watson, Mike (Glasgow Cathcart) (Lab)
Welsh, Mr Andrew (Angus) (SNP)
White, Ms Sandra (Glasgow) (SNP)
Whitefield, Karen (Airdrie and Shotts) (Lab)
Wilson, Allan (Cunninghame North) (Lab)
The result of the division is: For 17, Against 98, Abstentions 0.
Amendment 53 disagreed to.
Amendment 54 not moved.
Section 13—References to charitable status
Group 7 is on references to charitable status. I am afraid that we will have to move very quickly on the group. Amendment 6, in the name of the minister, is grouped with amendments 7 to 11.
All the amendments in the group are aimed at the provisions relating to references made about a body's charitable status. Amendment 6 corrects an inconsistency in section 13. Section 13(4) does not refer to bodies that are
"established under the law of Scotland",
which is referred to in section 13(2). Amendment 6 corrects that omission and brings subsections (2) and (4) into line with each other.
Amendments 7 to 11 will allow OSCR and the Court of Session to act against charities that falsely represent themselves, or that are so represented by persons, as Scottish charities or registered Scottish charities. Without that provision, the requirement that charities are not to describe themselves as Scottish charities or registered Scottish charities is unenforceable. The bill already contains similar provisions in relation to bodies that represent themselves as charities or are so represented.
I move amendment 6.
Amendment 6 agreed to.
After section 18
Group 8 is on the removal of charities from the register. Amendment 22, in the name of Christine Grahame, is in a group on its own.
Amendment 22 is a humble and practical amendment that I hope will find favour—indeed, I think that a similar amendment that I lodged at stage 2 found favour with some committee members. The amendment simply seeks to provide for a list of charities that are defunct or have been removed from the register.
Members may wonder what the purpose of the amendment is. One often thinks of the student with no money who tries to find a charity to help them. A charity that was set up some time ago may still be lurking somewhere; even if it is no longer functioning, it may still have assets that, under its charitable purposes, are directed specifically to a football bursary, let us say. The student might not know that the charity existed and might have great difficulty finding it. However, if OSCR kept a list, anyone who sought to find out whether a defunct charity or a charity that had been removed from the register still had assets would be able to find such bodies centrally and, perhaps, access them.
When I raised that idea in committee, the minister rejected my amendment, saying that
"such a list is unnecessary, as section 47 allows financial institutions to inform OSCR of any dormant charity accounts."—[Official Report, Communities Committee, 27 April 2005; c 2095.]
That is simply allowing; it is not compelling. If we were to compel, a comprehensive list would be available to the whole of Scotland. I cannot understand why the minister is so resistant to that idea. The amendment seems sensible and practical. The measure would be useful to many people throughout Scotland and I look forward to hearing what the minister has to say about it.
I move amendment 22.
I am overwhelmed by members' humility.
Christine Grahame lodged a similar amendment at stage 2 but withdrew it after the Executive agreed to consider the issue further. Following careful consideration, I still fail to see what benefits amendment 22 would bring.
Although the bill does not place a duty on OSCR to maintain or publish a list of defunct charities or charities that have been removed from the register, nothing would prevent OSCR from creating a list of charities that have been removed from the register if it wished to do so, as I have said before. Indeed, it is anticipated that OSCR will maintain such a list. However, to require OSCR to do that has the potential to cause confusion, particularly as the amendment provides for a single list of charities that are defunct and of those bodies that are no longer charities. If OSCR maintained the information voluntarily, it could separate the bodies and have two lists. Moreover, if the list led some people to the mistaken belief that a particular body was still a charity, OSCR could suspend the list, whereas, because the amendment would oblige OSCR to keep a publicly available list, OSCR would be unable to react in that way if a problem were to arise.
It has been argued that a list would provide greater clarity but, given that the only real charities will be those bodies that are named on the register, the situation is arguably already very clear: any body that did not appear on the register would not be a charity. If it was necessary to establish whether a body had previously been a charity, OSCR could specifically be requested to provide that information. In any event, OSCR is required to publish a report on each case on which it takes action, which would include action that results in removing a charity from the register.
It has also been argued that a list of defunct charities would facilitate the revival of such charities or the redistribution of their assets. However, provisions in the bill allow OSCR to deal with charities that would previously have lain dormant, so a list of defunct charities is unnecessary. Assets of a charity that is removed from the register are protected by section 19 and dormant charities are covered by regulations under section 48. Under the accounting regulations, it is proposed that any dormant or defunct charity will still have to submit its accounts to OSCR. If it has failed to do so or, on examination of the accounts, there was concern, OSCR could apply to the Court of Session to reorganise the charity under section 41 to enable its resources to be applied for charitable purposes to better effect. The Executive believes that those provisions mean that the number of defunct charities should be relatively few, which makes a list of them unnecessary.
There is a risk that requiring OSCR to produce and maintain such a list could be an inefficient use of its resources. OSCR should retain the flexibility to produce lists if it feels that there is sufficient demand, but it should not be under a duty to do so. Therefore, I humbly ask Christine Grahame to seek agreement to withdraw amendment 22.
Does Christine Grahame wish to press or withdraw the amendment?
I wish to press it.
The question is, that amendment 22 be agreed to. Are we agreed?
No.
There will be a division.
For
Adam, Brian (Aberdeen North) (SNP)
Aitken, Bill (Glasgow) (Con)
Baird, Shiona (North East Scotland) (Green)
Ballance, Chris (South of Scotland) (Green)
Ballard, Mark (Lothians) (Green)
Brocklebank, Mr Ted (Mid Scotland and Fife) (Con)
Byrne, Ms Rosemary (South of Scotland) (SSP)
Crawford, Bruce (Mid Scotland and Fife) (SNP)
Cunningham, Roseanna (Perth) (SNP)
Davidson, Mr David (North East Scotland) (Con)
Douglas-Hamilton, Lord James (Lothians) (Con)
Ewing, Fergus (Inverness East, Nairn and Lochaber) (SNP)
Ewing, Mrs Margaret (Moray) (SNP)
Fabiani, Linda (Central Scotland) (SNP)
Fergusson, Alex (Galloway and Upper Nithsdale) (Con)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Gallie, Phil (South of Scotland) (Con)
Gibson, Rob (Highlands and Islands) (SNP)
Goldie, Miss Annabel (West of Scotland) (Con)
Grahame, Christine (South of Scotland) (SNP)
Harper, Robin (Lothians) (Green)
Harvie, Patrick (Glasgow) (Green)
Hyslop, Fiona (Lothians) (SNP)
Ingram, Mr Adam (South of Scotland) (SNP)
Johnstone, Alex (North East Scotland) (Con)
MacAskill, Mr Kenny (Lothians) (SNP)
Marwick, Tricia (Mid Scotland and Fife) (SNP)
Mather, Jim (Highlands and Islands) (SNP)
Matheson, Michael (Central Scotland) (SNP)
Maxwell, Mr Stewart (West of Scotland) (SNP)
McFee, Mr Bruce (West of Scotland) (SNP)
McGrigor, Mr Jamie (Highlands and Islands) (Con)
McLetchie, David (Edinburgh Pentlands) (Con)
Milne, Mrs Nanette (North East Scotland) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Morgan, Alasdair (South of Scotland) (SNP)
Neil, Alex (Central Scotland) (SNP)
Ruskell, Mr Mark (Mid Scotland and Fife) (Green)
Scanlon, Mary (Highlands and Islands) (Con)
Scott, Eleanor (Highlands and Islands) (Green)
Scott, John (Ayr) (Con)
Stevenson, Stewart (Banff and Buchan) (SNP)
Sturgeon, Nicola (Glasgow) (SNP)
Swinburne, John (Central Scotland) (SSCUP)
Swinney, Mr John (North Tayside) (SNP)
Welsh, Mr Andrew (Angus) (SNP)
White, Ms Sandra (Glasgow) (SNP)
Against
Arbuckle, Mr Andrew (Mid Scotland and Fife) (LD)
Baillie, Jackie (Dumbarton) (Lab)
Baker, Richard (North East Scotland) (Lab)
Barrie, Scott (Dunfermline West) (Lab)
Boyack, Sarah (Edinburgh Central) (Lab)
Brankin, Rhona (Midlothian) (Lab)
Brown, Robert (Glasgow) (LD)
Butler, Bill (Glasgow Anniesland) (Lab)
Canavan, Dennis (Falkirk West) (Ind)
Chisholm, Malcolm (Edinburgh North and Leith) (Lab)
Craigie, Cathie (Cumbernauld and Kilsyth) (Lab)
Curran, Ms Margaret (Glasgow Baillieston) (Lab)
Deacon, Susan (Edinburgh East and Musselburgh) (Lab)
Eadie, Helen (Dunfermline East) (Lab)
Ferguson, Patricia (Glasgow Maryhill) (Lab)
Finnie, Ross (West of Scotland) (LD)
Glen, Marlyn (North East Scotland) (Lab)
Gorrie, Donald (Central Scotland) (LD)
Henry, Hugh (Paisley South) (Lab)
Home Robertson, John (East Lothian) (Lab)
Hughes, Janis (Glasgow Rutherglen) (Lab)
Jackson, Dr Sylvia (Stirling) (Lab)
Jackson, Gordon (Glasgow Govan) (Lab)
Jamieson, Cathy (Carrick, Cumnock and Doon Valley) (Lab)
Jamieson, Margaret (Kilmarnock and Loudoun) (Lab)
Kerr, Mr Andy (East Kilbride) (Lab)
Lamont, Johann (Glasgow Pollok) (Lab)
Livingstone, Marilyn (Kirkcaldy) (Lab)
Lyon, George (Argyll and Bute) (LD)
Macdonald, Lewis (Aberdeen Central) (Lab)
Macintosh, Mr Kenneth (Eastwood) (Lab)
Maclean, Kate (Dundee West) (Lab)
Macmillan, Maureen (Highlands and Islands) (Lab)
Martin, Paul (Glasgow Springburn) (Lab)
May, Christine (Central Fife) (Lab)
McAveety, Mr Frank (Glasgow Shettleston) (Lab)
McCabe, Mr Tom (Hamilton South) (Lab)
McMahon, Michael (Hamilton North and Bellshill) (Lab)
McNeil, Mr Duncan (Greenock and Inverclyde) (Lab)
McNeill, Pauline (Glasgow Kelvin) (Lab)
McNulty, Des (Clydebank and Milngavie) (Lab)
Morrison, Mr Alasdair (Western Isles) (Lab)
Muldoon, Bristow (Livingston) (Lab)
Mulligan, Mrs Mary (Linlithgow) (Lab)
Munro, John Farquhar (Ross, Skye and Inverness West) (LD)
Murray, Dr Elaine (Dumfries) (Lab)
Oldfather, Irene (Cunninghame South) (Lab)
Peacock, Peter (Highlands and Islands) (Lab)
Peattie, Cathy (Falkirk East) (Lab)
Pringle, Mike (Edinburgh South) (LD)
Purvis, Jeremy (Tweeddale, Ettrick and Lauderdale) (LD)
Radcliffe, Nora (Gordon) (LD)
Robson, Euan (Roxburgh and Berwickshire) (LD)
Scott, Tavish (Shetland) (LD)
Smith, Elaine (Coatbridge and Chryston) (Lab)
Smith, Iain (North East Fife) (LD)
Smith, Margaret (Edinburgh West) (LD)
Stephen, Nicol (Aberdeen South) (LD)
Turner, Dr Jean (Strathkelvin and Bearsden) (Ind)
Watson, Mike (Glasgow Cathcart) (Lab)
Whitefield, Karen (Airdrie and Shotts) (Lab)
Wilson, Allan (Cunninghame North) (Lab)
The result of the division is: For 47, Against 62, Abstentions 0.
Amendment 22 disagreed to.
Section 19—Removal from Register: protection of assets
Group 9 is on removal from the register and the protection of assets. Amendment 55, in the name of Patrick Harvie, is in a group on its own.
Many of the arguments on this subject were rehearsed when we discussed one of my previous amendments. The issue of the protection of assets concerns charities that are removed from the register and organisations losing their charitable status. I hope that the minister can respond on the principle of protecting assets and distributing them only to other charities. That does not relate to organisations whose existence will continue, including the national collections. I look forward to the minister's response.
I move amendment 55.
Section 19 sets out procedures for protecting the assets of a charity that is removed from the register. It requires the body to continue to apply its assets in line with its charitable purposes, following removal from the register. Section 19(8), which amendment 55 seeks to remove, was intended to allow ministers to disapply the provisions by order in special circumstances. Ministers would have to have good reasons to exempt a body that was losing its charitable status from section 19, and any order that was made would be subject to the affirmative procedure, and would therefore have to be justified to and considered by Parliament. It is important to be able to disapply section 19 so that if, for example, a non-departmental public body lost its charitable status, property that had been obtained with public funds could remain under that NDPB's full control. I ask Patrick Harvie to withdraw amendment 55.
I will press the amendment.
The question is, that amendment 55 be agreed to. Are we agreed?
No.
There will be a division.
For
Baird, Shiona (North East Scotland) (Green)
Ballance, Chris (South of Scotland) (Green)
Ballard, Mark (Lothians) (Green)
Byrne, Ms Rosemary (South of Scotland) (SSP)
Harper, Robin (Lothians) (Green)
Harvie, Patrick (Glasgow) (Green)
Ruskell, Mr Mark (Mid Scotland and Fife) (Green)
Scott, Eleanor (Highlands and Islands) (Green)
Turner, Dr Jean (Strathkelvin and Bearsden) (Ind)
Against
Adam, Brian (Aberdeen North) (SNP)
Aitken, Bill (Glasgow) (Con)
Arbuckle, Mr Andrew (Mid Scotland and Fife) (LD)
Baillie, Jackie (Dumbarton) (Lab)
Baker, Richard (North East Scotland) (Lab)
Barrie, Scott (Dunfermline West) (Lab)
Boyack, Sarah (Edinburgh Central) (Lab)
Brankin, Rhona (Midlothian) (Lab)
Brocklebank, Mr Ted (Mid Scotland and Fife) (Con)
Brown, Robert (Glasgow) (LD)
Butler, Bill (Glasgow Anniesland) (Lab)
Canavan, Dennis (Falkirk West) (Ind)
Chisholm, Malcolm (Edinburgh North and Leith) (Lab)
Craigie, Cathie (Cumbernauld and Kilsyth) (Lab)
Crawford, Bruce (Mid Scotland and Fife) (SNP)
Cunningham, Roseanna (Perth) (SNP)
Curran, Ms Margaret (Glasgow Baillieston) (Lab)
Davidson, Mr David (North East Scotland) (Con)
Deacon, Susan (Edinburgh East and Musselburgh) (Lab)
Douglas-Hamilton, Lord James (Lothians) (Con)
Eadie, Helen (Dunfermline East) (Lab)
Ewing, Fergus (Inverness East, Nairn and Lochaber) (SNP)
Ewing, Mrs Margaret (Moray) (SNP)
Fabiani, Linda (Central Scotland) (SNP)
Ferguson, Patricia (Glasgow Maryhill) (Lab)
Fergusson, Alex (Galloway and Upper Nithsdale) (Con)
Finnie, Ross (West of Scotland) (LD)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Gallie, Phil (South of Scotland) (Con)
Gibson, Rob (Highlands and Islands) (SNP)
Glen, Marlyn (North East Scotland) (Lab)
Goldie, Miss Annabel (West of Scotland) (Con)
Gorrie, Donald (Central Scotland) (LD)
Grahame, Christine (South of Scotland) (SNP)
Henry, Hugh (Paisley South) (Lab)
Home Robertson, John (East Lothian) (Lab)
Hughes, Janis (Glasgow Rutherglen) (Lab)
Hyslop, Fiona (Lothians) (SNP)
Ingram, Mr Adam (South of Scotland) (SNP)
Jackson, Dr Sylvia (Stirling) (Lab)
Jackson, Gordon (Glasgow Govan) (Lab)
Jamieson, Cathy (Carrick, Cumnock and Doon Valley) (Lab)
Jamieson, Margaret (Kilmarnock and Loudoun) (Lab)
Johnstone, Alex (North East Scotland) (Con)
Kerr, Mr Andy (East Kilbride) (Lab)
Lamont, Johann (Glasgow Pollok) (Lab)
Livingstone, Marilyn (Kirkcaldy) (Lab)
Lyon, George (Argyll and Bute) (LD)
MacAskill, Mr Kenny (Lothians) (SNP)
Macdonald, Lewis (Aberdeen Central) (Lab)
Macintosh, Mr Kenneth (Eastwood) (Lab)
Maclean, Kate (Dundee West) (Lab)
Macmillan, Maureen (Highlands and Islands) (Lab)
Martin, Paul (Glasgow Springburn) (Lab)
Marwick, Tricia (Mid Scotland and Fife) (SNP)
Mather, Jim (Highlands and Islands) (SNP)
Matheson, Michael (Central Scotland) (SNP)
Maxwell, Mr Stewart (West of Scotland) (SNP)
May, Christine (Central Fife) (Lab)
McAveety, Mr Frank (Glasgow Shettleston) (Lab)
McCabe, Mr Tom (Hamilton South) (Lab)
McFee, Mr Bruce (West of Scotland) (SNP)
McGrigor, Mr Jamie (Highlands and Islands) (Con)
McLetchie, David (Edinburgh Pentlands) (Con)
McMahon, Michael (Hamilton North and Bellshill) (Lab)
McNeil, Mr Duncan (Greenock and Inverclyde) (Lab)
McNeill, Pauline (Glasgow Kelvin) (Lab)
McNulty, Des (Clydebank and Milngavie) (Lab)
Milne, Mrs Nanette (North East Scotland) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Morgan, Alasdair (South of Scotland) (SNP)
Morrison, Mr Alasdair (Western Isles) (Lab)
Muldoon, Bristow (Livingston) (Lab)
Mulligan, Mrs Mary (Linlithgow) (Lab)
Munro, John Farquhar (Ross, Skye and Inverness West) (LD)
Murray, Dr Elaine (Dumfries) (Lab)
Neil, Alex (Central Scotland) (SNP)
Oldfather, Irene (Cunninghame South) (Lab)
Peacock, Peter (Highlands and Islands) (Lab)
Peattie, Cathy (Falkirk East) (Lab)
Pringle, Mike (Edinburgh South) (LD)
Purvis, Jeremy (Tweeddale, Ettrick and Lauderdale) (LD)
Radcliffe, Nora (Gordon) (LD)
Robson, Euan (Roxburgh and Berwickshire) (LD)
Scanlon, Mary (Highlands and Islands) (Con)
Scott, John (Ayr) (Con)
Scott, Tavish (Shetland) (LD)
Smith, Elaine (Coatbridge and Chryston) (Lab)
Smith, Iain (North East Fife) (LD)
Smith, Margaret (Edinburgh West) (LD)
Stephen, Nicol (Aberdeen South) (LD)
Stevenson, Stewart (Banff and Buchan) (SNP)
Sturgeon, Nicola (Glasgow) (SNP)
Swinburne, John (Central Scotland) (SSCUP)
Swinney, Mr John (North Tayside) (SNP)
Wallace, Mr Jim (Orkney) (LD)
Watson, Mike (Glasgow Cathcart) (Lab)
Welsh, Mr Andrew (Angus) (SNP)
White, Ms Sandra (Glasgow) (SNP)
Whitefield, Karen (Airdrie and Shotts) (Lab)
Wilson, Allan (Cunninghame North) (Lab)
The result of the division is: For 9, Against 101, Abstentions 0.
Amendment 55 disagreed to.
Section 24—Disclosure of information by and to OSCR
Group 10 is on the duty of auditors. Amendment 23, in the name of the minister, is grouped with amendments 24, 25, 28, 29, 56, 31, 31A, 32, 39, 40 and 42 to 44.
The central amendment in this group is amendment 31. It inserts into the bill a duty for auditors, independent examiners and reporting accountants to report to OSCR matters of material significance to the exercise of OSCR's functions under sections 28, 30 and 31. The new section introduced by amendment 31 will also allow those who examine a charity's accounts to report any other matter that they believe to be of relevance to OSCR's functions, but which is not covered by that duty. Amendment 42 ensures that a report made in accordance with that duty must be in writing.
The amendments have been lodged in response to calls from the Institute of Chartered Accountants of Scotland and the Communities Committee that the bill as introduced did not give those examining a charity's accounts enough guidance or protection to enable them to report matters to OSCR. I have some more details on those amendments, but I will turn instead to amendment 31A. It removes the reference to an external examiner who has been appointed to audit or examine independently a charity's statement of account being appointed by the charity mentioned in subsection (2) of the new section introduced by amendment 31. We lodged amendment 31A after it was pointed out to us that not all charities appoint their own external examiner.
Amendment 56 is similar to one that was lodged at stage 2, and will not be necessary if the Executive amendments are agreed to.
Amendment 25 links the removal of the restrictions on disclosure because of an obligation of confidentiality under section 25 to the new duty to disclose inserted by amendment 31. In doing so it answers ICAS's concerns that the provision did not extend to reporting accountants examining the accounts of a charitable company.
Amendment 28 inserts further provisions into section 38 so that the duty to report and the removal of confidentiality also apply to auditors, independent examiners and reporting accountants when OSCR's functions have been delegated to Scottish ministers or another public authority.
Amendments 23, 24, 29, 32, 39, 40, 43 and 44 are technical and their purpose is to reposition existing provisions as a consequence of the new section proposed in amendment 31.
I urge members to support the Executive amendments in the group. I ask Donald Gorrie not to move amendment 56, as it will no longer be necessary.
I move amendment 23.
I am happy to satisfy the minister. My amendment 56 had the same objective as the Executive amendments; the minister has produced voluminous amendments that cover the issue much better. They provide the protection that the auditors felt they required from being sued for breach of confidentiality if they reported adversely on a charity to OSCR. I will not move amendment 56.
Minister, you will not have anything to add to that.
Amendment 23 agreed to.
Section 25—Removal of restrictions on disclosure of certain information
Amendments 24 and 25 moved—[Malcolm Chisholm]—and agreed to.
Section 28—Inquiries about charities etc
Group 11 is on inquiries about charities. Amendment 26, in the name of John Home Robertson, is in a group on its own.
Amendment 26 would provide explicitly for OSCR to make inquiries about any charity in response to information or representations that it might receive from any source about that charity. It would provide for OSCR to take action on information received from whistleblowers, but I stress that OSCR would have full discretion to decide whether to act on such information. The amendment is not intended to be a charter for malicious clypes.
We all want to improve the reputation of Scottish charities. That is one of the key objectives of the bill. We know from experience that virtually all the charities in Scotland, big and small, are good, efficient and conscientious organisations— genuine charities. That makes it all the more important that any organisations that do not come up to those high standards should be dealt with promptly and fairly to safeguard the reputation of all the good charities.
I have been in elected office for a long time— some would say far too long.
Hear, hear.
I knew members were awake. During that time I have come across just two cases involving questionable charities. People tried to blow the whistle, but under the old arrangement, nothing happened. I went into some detail about the Atlantic Salmon Conservation Trust (Scotland) and the Algrade Trust in the Communities Committee, and what I said can be found at column 2100 of the Official Report of the committee meeting on 27 April 2005. That is on the record, so I will not repeat it now. The point is that I tried to raise questions about the Algrade Trust and the Atlantic Salmon Conservation Trust (Scotland) as the local MP, but as far as I know, nothing was done about either case.
I am grateful to the minister for undertaking to reflect on the case for a whistleblower provision in the bill when she replied to the debate in the committee. I hope that OSCR will ensure that appropriate inquiries can be made into such matters in future, and I offer amendment 26 to the Parliament as a way to ensure that that can happen.
I move amendment 26.
John Home Robertson's amendment 26 would set out in the bill that OSCR may make inquiries either of its own accord or as a result of representations by the public. It is likely that a large proportion of the inquiries that OSCR undertakes will be sparked by a complaint or inquiry by the public. One of the aims of the bill is to reassure the public by providing an independent regulator to whom they can turn if they are concerned about a charity's activities. As the bill stands, any member of the public may make a complaint to OSCR that could lead to an inquiry. It is nevertheless important to retain a degree of discretion for OSCR, and to state that it does not have a duty to investigate every complaint. There is, after all, always a possibility of vexatious or malicious complaints. OSCR will be accountable and will have to be reasonable in deciding not to investigate a complaint. Given the arguments made by John Home Robertson both today and at stage 2, which are on record in the Official Report, and the fact that amendment 26 sits well with the objectives of the bill, we agree with it and urge the Parliament to support it.
Amendment 26 agreed to.
Section 31—Powers of OSCR following inquiries
Amendments 7, 8 and 27 moved—[Malcolm Chisholm]—and agreed to.
Section 32—Suspensions and directions: procedure
Amendment 9 moved—[Malcolm Chisholm]—and agreed to.
Section 34—Powers of Court of Session
Amendments 10 and 11 moved—[Malcolm Chisholm]—and agreed to.
Section 38—Delegation of functions
Amendment 28 moved—[Malcolm Chisholm]—and agreed to.
Section 39—Bodies controlled by a charity
Amendment 29 moved—[Malcolm Chisholm]—and agreed to.
Section 43—Reorganisation: supplementary
Group 12 is on the reorganisation of charities. Amendment 30, in the name of the minister, is in a group on its own.
The amendment removes the exclusion preventing local authority charitable trusts from being reorganised under sections 40 and 41 of the bill. It follows concerns raised by OSCR, and will allow local authorities to apply to OSCR to approve a reorganisation scheme, under the new legislation, of many charitable trusts held by them. We understand that several local authorities have indicated that the provision would be of significant benefit, and it will allow more efficient operation of many small trusts.
I move amendment 30.
Amendment 30 agreed to.
Section 45—Accounts
Amendment 56 not moved.
After section 46
Amendment 31 moved—[Malcolm Chisholm].
Amendment 31A moved—[Malcolm Chisholm]—and agreed to.
Amendment 31, as amended, agreed to.
Section 56—Conversion of charity which is a company or registered friendly society: applications
Amendment 32 moved—[Malcolm Chisholm]—and agreed to.
Section 65—Charity trustees: general duties
Group 13 is on the duties of charity trustees. Amendment 57, in the name of Donald Gorrie, is in a group on its own.
The purpose of the amendment is to make it clear that when, as quite often happens, a person is put on to a charity as a charity trustee from another body—which might be the local council, a chamber of commerce, a church, a school or whatever—their first duty is to be a charity trustee rather than to look after the interests of the other body. The amendment is supposed to cover the issue of the independence of arm's-length companies and other charities of that sort. The issue is quite clear and the wording of the amendment has had the acceptance of those up aloft. I therefore hope that members will vote for it.
I move amendment 57.
As I mentioned in an earlier discussion, Donald Gorrie's amendment is helpful. It clarifies in the bill how conflicts between the interests of the charity and that of any person responsible for appointing a trustee should be dealt with. We believe that the amendment reflects current good practice relating to how such conflicts are dealt with by charities. Putting the text of the amendment in the bill will help to reassure the public of the practical independence of trustees in whose appointment an outside body or person has had a role. We therefore encourage Parliament to agree to it.
Amendment 57 agreed to.
Amendment 58 not moved.
Amendment 33 moved—[Malcolm Chisholm].
The question is, that amendment 33 be agreed to. Are we agreed?
No.
There will be a division.
For
Aitken, Bill (Glasgow) (Con)
Arbuckle, Mr Andrew (Mid Scotland and Fife) (LD)
Baillie, Jackie (Dumbarton) (Lab)
Baker, Richard (North East Scotland) (Lab)
Barrie, Scott (Dunfermline West) (Lab)
Boyack, Sarah (Edinburgh Central) (Lab)
Brankin, Rhona (Midlothian) (Lab)
Brocklebank, Mr Ted (Mid Scotland and Fife) (Con)
Butler, Bill (Glasgow Anniesland) (Lab)
Canavan, Dennis (Falkirk West) (Ind)
Chisholm, Malcolm (Edinburgh North and Leith) (Lab)
Craigie, Cathie (Cumbernauld and Kilsyth) (Lab)
Curran, Ms Margaret (Glasgow Baillieston) (Lab)
Deacon, Susan (Edinburgh East and Musselburgh) (Lab)
Douglas-Hamilton, Lord James (Lothians) (Con)
Eadie, Helen (Dunfermline East) (Lab)
Ferguson, Patricia (Glasgow Maryhill) (Lab)
Fergusson, Alex (Galloway and Upper Nithsdale) (Con)
Finnie, Ross (West of Scotland) (LD)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Gallie, Phil (South of Scotland) (Con)
Glen, Marlyn (North East Scotland) (Lab)
Goldie, Miss Annabel (West of Scotland) (Con)
Henry, Hugh (Paisley South) (Lab)
Home Robertson, John (East Lothian) (Lab)
Hughes, Janis (Glasgow Rutherglen) (Lab)
Jackson, Dr Sylvia (Stirling) (Lab)
Jackson, Gordon (Glasgow Govan) (Lab)
Jamieson, Cathy (Carrick, Cumnock and Doon Valley) (Lab)
Jamieson, Margaret (Kilmarnock and Loudoun) (Lab)
Johnstone, Alex (North East Scotland) (Con)
Kerr, Mr Andy (East Kilbride) (Lab)
Lamont, Johann (Glasgow Pollok) (Lab)
Livingstone, Marilyn (Kirkcaldy) (Lab)
Lyon, George (Argyll and Bute) (LD)
Macdonald, Lewis (Aberdeen Central) (Lab)
Maclean, Kate (Dundee West) (Lab)
Martin, Paul (Glasgow Springburn) (Lab)
May, Christine (Central Fife) (Lab)
McAveety, Mr Frank (Glasgow Shettleston) (Lab)
McCabe, Mr Tom (Hamilton South) (Lab)
McGrigor, Mr Jamie (Highlands and Islands) (Con)
McLetchie, David (Edinburgh Pentlands) (Con)
McMahon, Michael (Hamilton North and Bellshill) (Lab)
McNeil, Mr Duncan (Greenock and Inverclyde) (Lab)
McNulty, Des (Clydebank and Milngavie) (Lab)
Milne, Mrs Nanette (North East Scotland) (Con)
Morrison, Mr Alasdair (Western Isles) (Lab)
Muldoon, Bristow (Livingston) (Lab)
Mulligan, Mrs Mary (Linlithgow) (Lab)
Munro, John Farquhar (Ross, Skye and Inverness West) (LD)
Murray, Dr Elaine (Dumfries) (Lab)
Oldfather, Irene (Cunninghame South) (Lab)
Peacock, Peter (Highlands and Islands) (Lab)
Peattie, Cathy (Falkirk East) (Lab)
Pringle, Mike (Edinburgh South) (LD)
Purvis, Jeremy (Tweeddale, Ettrick and Lauderdale) (LD)
Radcliffe, Nora (Gordon) (LD)
Robson, Euan (Roxburgh and Berwickshire) (LD)
Rumbles, Mike (West Aberdeenshire and Kincardine) (LD)
Scanlon, Mary (Highlands and Islands) (Con)
Scott, John (Ayr) (Con)
Scott, Tavish (Shetland) (LD)
Smith, Elaine (Coatbridge and Chryston) (Lab)
Smith, Iain (North East Fife) (LD)
Smith, Margaret (Edinburgh West) (LD)
Stephen, Nicol (Aberdeen South) (LD)
Stone, Mr Jamie (Caithness, Sutherland and Easter Ross) (LD)
Swinburne, John (Central Scotland) (SSCUP)
Tosh, Murray (West of Scotland) (Con)
Wallace, Mr Jim (Orkney) (LD)
Watson, Mike (Glasgow Cathcart) (Lab)
Whitefield, Karen (Airdrie and Shotts) (Lab)
Wilson, Allan (Cunninghame North) (Lab)
Against
Adam, Brian (Aberdeen North) (SNP)
Ballard, Mark (Lothians) (Green)
Crawford, Bruce (Mid Scotland and Fife) (SNP)
Cunningham, Roseanna (Perth) (SNP)
Ewing, Fergus (Inverness East, Nairn and Lochaber) (SNP)
Ewing, Mrs Margaret (Moray) (SNP)
Fabiani, Linda (Central Scotland) (SNP)
Grahame, Christine (South of Scotland) (SNP)
Harper, Robin (Lothians) (Green)
Harvie, Patrick (Glasgow) (Green)
Hyslop, Fiona (Lothians) (SNP)
MacAskill, Mr Kenny (Lothians) (SNP)
Marwick, Tricia (Mid Scotland and Fife) (SNP)
Mather, Jim (Highlands and Islands) (SNP)
Matheson, Michael (Central Scotland) (SNP)
Maxwell, Mr Stewart (West of Scotland) (SNP)
McFee, Mr Bruce (West of Scotland) (SNP)
Morgan, Alasdair (South of Scotland) (SNP)
Neil, Alex (Central Scotland) (SNP)
Ruskell, Mr Mark (Mid Scotland and Fife) (Green)
Scott, Eleanor (Highlands and Islands) (Green)
Stevenson, Stewart (Banff and Buchan) (SNP)
Sturgeon, Nicola (Glasgow) (SNP)
Swinney, Mr John (North Tayside) (SNP)
Welsh, Mr Andrew (Angus) (SNP)
White, Ms Sandra (Glasgow) (SNP)
Abstentions
Brown, Robert (Glasgow) (LD)
Byrne, Ms Rosemary (South of Scotland) (SSP)
Fox, Colin (Lothians) (SSP)
Gorrie, Donald (Central Scotland) (LD)
Leckie, Carolyn (Central Scotland) (SSP)
Turner, Dr Jean (Strathkelvin and Bearsden) (Ind)
The result of the division is: For 74, Against 26, Abstentions 6.
Amendment 33 agreed to.
Amendment 59 not moved.
Amendment 64 moved—[Donald Gorrie]—and agreed to.
Section 66—Remuneration for services
Group 14 is on the remuneration of charity trustees. Amendment 34, in the name of the minister, is grouped with amendments 35 to 38.
This is an important group of amendments that have generated a great deal of discussion and debate. I hope that you will give me sufficient time, Presiding Officer, to outline what we seek to do. The amendments deal with the section of the bill that relates to remuneration for services. The remuneration of charity trustees has been much debated during the progress of the bill. I am grateful to those who gave evidence to the Communities Committee and to members of the committee for their input, and I am pleased that there is now agreement on the way forward.
Some people in the charity sector strongly believe that, to cement their position in the voluntary sector and to avoid any conflict of interest, charity trustees should not be remunerated for any work that they carry out as charity trustees. That view is held by some members of the Opposition parties. The contrary argument is that the level of service that is required of the trustees of some charities demands payment, otherwise people would not agree to be charity trustees in the first place. That is particularly true for larger charities. Many charity trustees are paid or receive a benefit for their services as trustees. For instance, many student associations pay students to be a charity trustee—for example, the treasurer—of their association. That covers lost income and allows them to take a sabbatical from their studies for a limited period.
It might be helpful if I clarify the existing position in charity law in Scotland. There is currently no restriction on the payment of charity trustees or those who are in control of charities provided that there is express legal authority for such payment to be made. The authority for payment can be included in a charity's constitution or in another enactment, or it can be given by a Court of Session order. If authority by one of those means exists, a charity may remunerate a person who is carrying out the normal duties of a charity trustee; a person who is providing additional services that a trustee would not normally provide; or a trustee who is also an employee of the charity.
The bill will tighten up the circumstances in which a charity trustee may receive remuneration in the future. Although there is a view that the payment of trustees should not be the norm, we need to provide sufficient flexibility to allow the bill to suit the wide range of charities in the sector. Permitting remuneration only in highly defined circumstances is the best way of achieving that.
Amendment 34 and amendment 35, which is consequential on amendment 34, will clarify the position. Amendment 34 will add a new subsection to set out clearly that a charity trustee cannot be remunerated for their services as a charity trustee, for other services or for services as an employee of the charity unless the strict conditions in section 66 are complied with. The conditions are that the maximum payment must be reasonable and set out in a written agreement and that the charity trustees must be satisfied that the payment is in the interests of the charity. Also, only a minority of charity trustees may receive remuneration, and there must be no provision in the charity's constitution that expressly prohibits the payment. The bill will also ensure that payment cannot be made to persons who are connected to charity trustees unless the same conditions apply. That will prevent a charity from being controlled by charity trustees who pay their close family for providing services to the charity, for instance.
It would be wrong for us to remove existing rights for some charity trustees who already have a right to be paid, or for whom Parliament or the Court of Session has decided that payment is appropriate. That was covered in section 66(5) of the bill as introduced. Discussion during stage 1 indicated concern that the provisions were not tight enough, so the Executive's amendments 36 to 38 will clarify that the exemption from having to meet the conditions in that section for a charity whose existing constitution allows payment will apply only where payment is specifically allowed by an "authorising provision". There had been concern that some charity constitutions might contain non-specific, wide-ranging provisions allowing any payment that the charity trustees considered to be in the interests of the charity. The constitution will now be required to refer specifically to the payment or remuneration of a charity trustee and the provision will apply only to charities with an authorising provision in their constitution prior to the introduction of the bill on 15 November 2004.
A slightly separate but related issue is whether the employees of a charity should be allowed to serve as trustees of their employer. In an ideal world, it might be preferable for those controlling a charity to be entirely independent of those employed by it, but neither we nor the charitable sector live there.
I am aware that the rules that we are setting in this bill must be suitable for the wide range of charities in the sector. It is accepted that we expect more and more of our charities—more efficiency, more effectiveness and for them to be more businesslike. In some cases, it is particularly useful for the employees of a charity to be represented on the controlling body. For example, many further education colleges and universities have both academic and non-academic staff members on their board of management. That is also of wider value. It is desirable for employees to have an input in deciding the direction of their company, and perhaps that should also apply to charities.
With the amendments, the bill will give us an appropriate, flexible system that will provide reassurance to charities and the public that their funds will be used sensibly and transparently but will also help the sector to be more businesslike and effective in its operations.
I move amendment 34, and urge members to accept the other Executive amendments in the group.
Amendment 34 agreed to.
Amendments 35 to 38 moved—[Malcolm Chisholm]—and agreed to.
Section 67—Remuneration: supplementary
Amendment 39 moved—[Malcolm Chisholm]—and agreed to.
Section 75—Appeals to Scottish Charity Appeals Panel
Group 15 is on the Scottish charity appeals panel. Amendment 12, in the name of the minister, is grouped with amendment 19.
The amendments address whether the Scottish charity appeals panel should be allowed to award expenses or compensation. The issue was debated by the committee at some length at stage 2.
Following further consideration, the Executive has decided that the Scottish charity appeals panel should have the power to award expenses but not compensation. That is in line with the views expressed by the committee in the debate.
Accordingly, amendment 12 will remove the subsection in section 75 that prevents the panel from awarding expenses to OSCR or to any person who appeals a decision. Amendment 19 will add a power to the provisions in schedule 2 to allow ministers to set out that the panel may award expenses to both OSCR and the appellant in certain circumstances. That is important to safeguard against malicious or vexatious appeals. The detail on making awards of expenses will be set out in the rules on the practice and procedure of the panel, which will be made following consultation with the Council on Tribunals.
I move amendment 12.
Amendment 12 agreed to.
Section 78—Interpretation of Part 2
Amendment 40 moved—[Malcolm Chisholm]—and agreed to.
Section 84—Regulation of public benevolent collections
Group 16 is on regulation of public benevolent collections. Amendment 13, in the name of the minister, is grouped with amendments 14 and 15.
Amendments 13 to 15 relate to the bill's provisions on public benevolent collections. They were drafted after concerns were raised in relation to similar proposals in the Home Office Charities Bill.
Section 84(2)(c) allows a benevolent body to hold a collection on land that it owns or occupies without obtaining local authority consent if the body must expressly or implicitly allow public access to the land. There is concern that land that a benevolent body occupies but to which the public have access by virtue of an enactment, such as the Land Reform (Scotland) Act 2003, would not be covered. Therefore, the occupier would be required to obtain local authority permission for the collection that they wished to hold on the land. That is a valid concern, so we have lodged amendment 13, which seeks to extend section 84(2)(c) to cover the situation.
Amendments 14 and 15 are consequential on amendment 13.
I move amendment 13.
Amendment 13 agreed to.
Amendments 14 and 15 moved—[Malcolm Chisholm]—and agreed to.
Section 92—Extension of general powers of trustees
Group 17 is on the investment powers of trustees. Amendment 60, in the name of Christine Grahame, is grouped with amendments 41, 61 and 62.
I will move amendment 60, but I may have to seek leave to withdraw it. I want to hear what the minister has to say about his amendment 41.
Amendments 60 and 61 are Law Society of Scotland amendments and they are quite technical. Under old Scots law rules, there is a general rule against the delegation of trust duties. Current market practice has developed in such a way that, to comply with electronic market deadlines, individual shareholders have shares held in nominee names. If anything goes wrong with the nominee, the trustee could be exposed to unlimited personal liability. Therefore, amendment 60 seeks to give authorisation to trustees to have investments held by a nominee company. Under the same general rule against the delegation of trust duties, if anything went wrong with a third party, the trustee could be exposed to unlimited liability. Amendment 61 seeks to give authorisation to trustees to delegate investment decisions to a suitably qualified person.
Amendments 60 and 61 seek to give trustees the power to wield the wider investment powers that are contained in the bill. I look forward to hearing the minister advise whether his amendments deal with those issues.
I move amendment 60.
During the consultation on the draft bill and the evidence taking by the Communities Committee and the Finance Committee, there were calls for a provision to allow trustees to appoint nominees in relation to trust investments. There were also calls for the bill to be amended to include a provision on the power of trustees to delegate decision-making powers. It was argued that that would bring improvements in both investment performance and income for some charities and trusts. The Communities Committee recommended in its stage 1 report that further consideration should be given to ensuring that trustees have the specific power to delegate investment of funds to fund managers. Amendment 41 provides a default power for trustees to appoint nominees in relation to trust investments and to transfer the title of the assets to the nominees.
The purpose of Christine Grahame's amendment 60 is similar to that of amendment 41, but I believe that her amendment would be less effective than amendment 41 because it does not set out the key elements of the duty of care to which trustees must pay particular regard in exercising the power. Therefore, I ask Christine Grahame to withdraw her amendment 60.
Amendment 62 will provide a default power for trustees to delegate to agents the management of investments, including discretionary management of investments. The purpose of Christine Grahame's amendment 61 is similar to that of amendment 62, but I believe that it would be less effective than amendment 62 because it does not indicate that this is a clarification of the current law, nor that the law extends to the discretionary management of investments. The Executive amendments were drafted in consultation with the Scottish Law Commission and they have its support. Therefore, I ask Christine Grahame not to move amendment 61. I ask the Parliament to support amendments 41 and 62.
Amendment 60, by agreement, withdrawn.
Amendment 41 moved—[Malcolm Chisholm]—and agreed to.
Amendment 61 not moved.
Amendment 62 moved—[Malcolm Chisholm]—and agreed to.
Section 97—Population of Register etc
Group 18 is on pre-existing charities that are included in the register and the powers of OSCR. Amendment 16, in the name of the minister, is grouped with amendment 17.
Amendment 16 is necessary to dispel any doubt about whether OSCR has the ability to remove charities from the register when they no longer meet the charity test. Although section 97 is aimed at achieving the transition from the current regulatory regime to that provided for under the bill, it is not a temporary provision.
The charities that transfer to the register from the current HM Revenue and Customs index—the former Inland Revenue index—will be able to continue to operate as charities under the bill. Like any new charities that will be recognised and registered after the bill is passed, they will cease to be charities only if they decide not to continue as charities, when they can apply for removal from the Scottish charity register under section 18, or if it appears to OSCR, following inquiries, that they no longer meet the charity test, when they will be removed from the register. Amendment 16 is intended to make it clear that section 97 does not make charities' status unassailable and that OSCR can remove them in the same way as it will be able to remove new charities from the register.
The first half of amendment 17 mirrors amendment 16, but the second part attempts to include text from stage 2 amendment 93. The amendment would require OSCR to inform an existing charity that it believed that the charity did not meet the charity test and to listen to the charity's response before using its power in section 30 to remove the charity from the register.
I understand and agree with the intention of amendment 17, but it is unnecessary, as section 30 provides OSCR with an alternative power to direct a charity to take such steps as it considers necessary to ensure that the charity meets the test. Therefore, OSCR can issue a charity with such a direction before deciding whether it needs to remove the charity from the register.
In practice, if a straightforward way exists to ensure that a charity can continue to meet the charity test, OSCR is unlikely to remove it from the register without giving it a chance to remedy the problems and time to respond. That is particularly the case since amendment 20 provides that in performing its regulatory functions, OSCR must be proportionate.
OSCR is also required to prepare a report on the subject matter of inquiries that result in the removal of a charity from the register. Any decision by OSCR to remove a charity from the register can, of course, be reviewed or appealed if the charity disagrees with OSCR's decision. Removal from the register does not occur until the time that is set out under the appeal mechanism has passed. If a review or appeal is requested, it must run its course before the charity is removed. That gives a charity time to consider OSCR's decision and to respond to or remedy the problems that have been identified. Therefore, I ask Donald Gorrie not to move amendment 17.
I move amendment 16.
I call Donald Gorrie to speak to amendments 17 and 16 very briefly.
Amendment 17's purpose is to give a second kick at the ball to existing charities that might not satisfy OSCR's new rules. The amendment would give them a second chance. The minister gave a satisfactory explanation of the various consultation procedures that OSCR will follow with organisations if they are in danger of not qualifying. In the light of that, I am happy not to move amendment 17.
I am sure that the deputy minister has nothing to add to that.
Amendment 16 agreed to.
Amendment 17 not moved.
Section 98—Notices, applications etc
I invite the minister to move amendments 42, 18 and 43 to 45 en bloc.
No.
The minister must move the amendments before I can ask whether members object.
Amendments 42, 18 and 43 to 45 moved—[Malcolm Chisholm].
Any member who wishes to object to a single question being put should object now.
We object.
I will put the question on each amendment in turn.
Amendment 42 agreed to.
Section 100—Ancillary provision
Amendment 18 agreed to.
After section 102
Amendment 43 agreed to.
Section 103—General interpretation
Amendment 44 agreed to.
The question is, that amendment 45 be agreed to. Are we agreed?
No.
There will be a division.
For
Arbuckle, Mr Andrew (Mid Scotland and Fife) (LD)
Baillie, Jackie (Dumbarton) (Lab)
Baker, Richard (North East Scotland) (Lab)
Barrie, Scott (Dunfermline West) (Lab)
Boyack, Sarah (Edinburgh Central) (Lab)
Brankin, Rhona (Midlothian) (Lab)
Butler, Bill (Glasgow Anniesland) (Lab)
Byrne, Ms Rosemary (South of Scotland) (SSP)
Canavan, Dennis (Falkirk West) (Ind)
Chisholm, Malcolm (Edinburgh North and Leith) (Lab)
Craigie, Cathie (Cumbernauld and Kilsyth) (Lab)
Curran, Frances (West of Scotland) (SSP)
Curran, Ms Margaret (Glasgow Baillieston) (Lab)
Deacon, Susan (Edinburgh East and Musselburgh) (Lab)
Eadie, Helen (Dunfermline East) (Lab)
Ferguson, Patricia (Glasgow Maryhill) (Lab)
Finnie, Ross (West of Scotland) (LD)
Fox, Colin (Lothians) (SSP)
Glen, Marlyn (North East Scotland) (Lab)
Henry, Hugh (Paisley South) (Lab)
Home Robertson, John (East Lothian) (Lab)
Hughes, Janis (Glasgow Rutherglen) (Lab)
Jackson, Dr Sylvia (Stirling) (Lab)
Jackson, Gordon (Glasgow Govan) (Lab)
Jamieson, Cathy (Carrick, Cumnock and Doon Valley) (Lab)
Jamieson, Margaret (Kilmarnock and Loudoun) (Lab)
Kerr, Mr Andy (East Kilbride) (Lab)
Lamont, Johann (Glasgow Pollok) (Lab)
Leckie, Carolyn (Central Scotland) (SSP)
Livingstone, Marilyn (Kirkcaldy) (Lab)
Lyon, George (Argyll and Bute) (LD)
Macdonald, Lewis (Aberdeen Central) (Lab)
Macintosh, Mr Kenneth (Eastwood) (Lab)
Maclean, Kate (Dundee West) (Lab)
Macmillan, Maureen (Highlands and Islands) (Lab)
Martin, Paul (Glasgow Springburn) (Lab)
May, Christine (Central Fife) (Lab)
McAveety, Mr Frank (Glasgow Shettleston) (Lab)
McCabe, Mr Tom (Hamilton South) (Lab)
McMahon, Michael (Hamilton North and Bellshill) (Lab)
McNeil, Mr Duncan (Greenock and Inverclyde) (Lab)
McNeill, Pauline (Glasgow Kelvin) (Lab)
McNulty, Des (Clydebank and Milngavie) (Lab)
Morrison, Mr Alasdair (Western Isles) (Lab)
Muldoon, Bristow (Livingston) (Lab)
Mulligan, Mrs Mary (Linlithgow) (Lab)
Munro, John Farquhar (Ross, Skye and Inverness West) (LD)
Murray, Dr Elaine (Dumfries) (Lab)
Oldfather, Irene (Cunninghame South) (Lab)
Peacock, Peter (Highlands and Islands) (Lab)
Peattie, Cathy (Falkirk East) (Lab)
Pringle, Mike (Edinburgh South) (LD)
Purvis, Jeremy (Tweeddale, Ettrick and Lauderdale) (LD)
Radcliffe, Nora (Gordon) (LD)
Robson, Euan (Roxburgh and Berwickshire) (LD)
Rumbles, Mike (West Aberdeenshire and Kincardine) (LD)
Scott, Tavish (Shetland) (LD)
Smith, Elaine (Coatbridge and Chryston) (Lab)
Smith, Iain (North East Fife) (LD)
Smith, Margaret (Edinburgh West) (LD)
Stone, Mr Jamie (Caithness, Sutherland and Easter Ross) (LD)
Wallace, Mr Jim (Orkney) (LD)
Watson, Mike (Glasgow Cathcart) (Lab)
Whitefield, Karen (Airdrie and Shotts) (Lab)
Wilson, Allan (Cunninghame North) (Lab)
Against
Adam, Brian (Aberdeen North) (SNP)
Baird, Shiona (North East Scotland) (Green)
Ballance, Chris (South of Scotland) (Green)
Ballard, Mark (Lothians) (Green)
Crawford, Bruce (Mid Scotland and Fife) (SNP)
Cunningham, Roseanna (Perth) (SNP)
Ewing, Fergus (Inverness East, Nairn and Lochaber) (SNP)
Ewing, Mrs Margaret (Moray) (SNP)
Fabiani, Linda (Central Scotland) (SNP)
Gibson, Rob (Highlands and Islands) (SNP)
Grahame, Christine (South of Scotland) (SNP)
Harper, Robin (Lothians) (Green)
Harvie, Patrick (Glasgow) (Green)
Hyslop, Fiona (Lothians) (SNP)
Ingram, Mr Adam (South of Scotland) (SNP)
MacAskill, Mr Kenny (Lothians) (SNP)
Marwick, Tricia (Mid Scotland and Fife) (SNP)
Mather, Jim (Highlands and Islands) (SNP)
Matheson, Michael (Central Scotland) (SNP)
Maxwell, Mr Stewart (West of Scotland) (SNP)
McFee, Mr Bruce (West of Scotland) (SNP)
Morgan, Alasdair (South of Scotland) (SNP)
Neil, Alex (Central Scotland) (SNP)
Ruskell, Mr Mark (Mid Scotland and Fife) (Green)
Scott, Eleanor (Highlands and Islands) (Green)
Stevenson, Stewart (Banff and Buchan) (SNP)
Swinburne, John (Central Scotland) (SSCUP)
Swinney, Mr John (North Tayside) (SNP)
Welsh, Mr Andrew (Angus) (SNP)
White, Ms Sandra (Glasgow) (SNP)
Abstentions
Aitken, Bill (Glasgow) (Con)
Brocklebank, Mr Ted (Mid Scotland and Fife) (Con)
Brown, Robert (Glasgow) (LD)
Davidson, Mr David (North East Scotland) (Con)
Douglas-Hamilton, Lord James (Lothians) (Con)
Fraser, Murdo (Mid Scotland and Fife) (Con)
Gallie, Phil (South of Scotland) (Con)
Goldie, Miss Annabel (West of Scotland) (Con)
Gorrie, Donald (Central Scotland) (LD)
Johnstone, Alex (North East Scotland) (Con)
McGrigor, Mr Jamie (Highlands and Islands) (Con)
McLetchie, David (Edinburgh Pentlands) (Con)
Milne, Mrs Nanette (North East Scotland) (Con)
Mitchell, Margaret (Central Scotland) (Con)
Scanlon, Mary (Highlands and Islands) (Con)
Scott, John (Ayr) (Con)
Turner, Dr Jean (Strathkelvin and Bearsden) (Ind)
The result of the division is: For 65, Against 30, Abstentions 17.
Amendment 45 agreed to.
Amendment 63 not moved.
Schedule 2
Scottish Charity Appeals Panel
Amendment 19 moved—[Malcolm Chisholm]—and agreed to.