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Introduce a de minimis level for Commercial Participators

Comment 27th August 2010

s59 of the Charities Act 1992 requires all people who want to raise money for charity through donating some of their profits from the sale of goods in the course of business and tell people that they are doing so (commercial participators) to enter into a written, signed agreement with the charity for which they are raising funds.  There are obviously very good reasons for this.

I think commercial participators who expect to raise £1,000 or less in a year should be permitted to do so without a written, signed agreement.  Alternatively, they should be required to comply with whatever terms the charity requires (these could be posted on charity websites).  If a charity wanted to require a written agreement this could be listed as one of their requirements, thereby allowing charities to 'opt out' of this change.  Small CPs should still be required to make the same statement to customers about the amount that they are giving to charity as CPs do under the current legislation.

There would be a risk of fraud, however, this would not be that different from the risk of a person organising another sort of fundraising event and not sending all the money to the charity.  If the charity became aware of such cases they could report them to the police.

The current legislation does not prevent fraud, a number of charities have been hit by clothing collection scams. Adding a de minimis would not substantially increase the risk of fraud.

The change could lead to businesses that a charity does not approve of raising money for the charity. However, this is not that different from the current system as such business can currently carry out non-CP fundraising events without informing the charity. The legislation could require such a small CP to stop their activitites if requested to do so by the charity.

 

Why does this matter?

It is not time or cost efficient for  large chariites to enter into written, signed agreements with commercial participators who expect to raise £1,000 or less and consequently they have to refuse permission for lots of small businesses to raise money.

This excludes lots of people (e.g. those who don't have wealthy social networks or the resources,  time, inclination or  ability to organise other types of fundraising event  or those who don't have sufficient spare cash to make straight forward donationss) from supporting causes that are close to their hearts.

Adding a de minimis for commercial participators would  make it easier for small businesses to be part of big society.  It would increase the amount of money raised for charity and create and encourage lifelong supporters for charities.  Such small businesses are often at the heart of their communities and are usually well placed and highly motivated to encourage other people to support the charity.

Imagine Beryl the Baker. Her sister has just died of leukeamia and Beryl currently raises money for leukemia charities which are very appreciative of her efforts, even though she  sends them 'only' a few hundred pounds a year.  However, in the recession her circumstances change.  She has to move to a new town where she doesn't know anyone so she can't organise fundraising social events, she doesn't have the spare cash to make a donation of her own money and she is too frail to take part in the charity's own events.  She decides to raise money by donating 10p for every cake she sells during November.  She expects to raise £300.  She contacts her favourite charity full of enthusiasm and but they say that the amount that she will raise is too small for it to be worth their while enterring into an agreement with her and she isn't allowed to carry out her plan without an agreement.  She is is shocked and hurt and decides to stop supporting the charity and writes it out of her will.  this outcome is bad for her, bad for the charity and bad for society.  Such stories could be prevented by adding a de minimis to this requirement.


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