Tuesday, 7 January 2014

Time to review Fairfield Halls charity governance arrangements again

A special meeting of the Scrutiny & Strategic Overview Committee should be held to review of the governance and management issues of Fairfield Halls, because the Croydon Tories have had to go back to the drawing board on their attempted take-over of the Trustee Board of the Fairfield Halls charity. 

Such a meeting would enable both Parties to make detailed statements in the lead up to the local elections in May, to invite Trustees and the CEO of the Halls to discuss the improvements it plans on the programme offer, and invite community activities to present their views based on the discussions initiated by South Croydon Community Association on the future of the Halls and the subsequent Arts Debate last year. A key question that could be usefully examined is whether the freehold of the Halls could be asset transferred by the Council to the charity.

It seems that the Tories are back to the drawing board because of the intervention by the Charity Commission at my request last April, the outcome of which has been emailed to me.

On 29 April last year the Tories agreed the plan for the Council to take control of Fairfield Halls and London Mozart Players as Council run charities. The Cabinet papers can be  https://secure.croydon.gov.uk/akscroydon/users/public/admin/kab14.pl?operation=SUBMIT&meet=15&cmte=CAB&grpid=public&arc=1.

Issues of Concern

The decision raised a lot of issues including:

·    the current conflict of interest for existing members of the Council who are members of the Halls Board in the debate at Cabinet and later at the Council meeting which will discuss the Cabinet decisions
·    whether the summary of the position of the Charity Commission is correct especially in the light of a past admission by the Commission of its concern over the governance of charities by local authorities
·    the artistic integrity of LMP
·   whether being a Council run charity will make it more difficult to fund raise from cultural charity funders
·    whether such a major change to charitable rules will require a formal public consultation process
·    whether Council control will exclude the development of community partnerships that may emerge from the South Croydon Community Association initiative about the future of the Halls

The reports did not contain any letters from the Charity Commission stating that what is proposed was acceptable and did not need its permission. 

Advice Sought of Charity Commission

I emailed the Commission earlier in the day on 29 April to draw its attention to what was intended. ‘The papers suggested that to do this the Council does not need the Commission’s approval.’ I cited the concern about the whole way the Halls are managed. I pointed out that that when I had correspondence with the Commission over the Beaufoy Trust in Lambeth that it had concerns about the way Councils run charities. I asked whether what was said about the Commission in the Cabinet papers was correct or not.

The Commission’s initial reply was that it assumed

‘that the Council are taking over as sole trustee of these two charities.  If this is correct, we can confirm that we would have no objection.  However, the charities must retain their independence, for example keep their own separate bank accounts.’ Further the ‘trustees will need to amend the governing documents of the charities to show that the Council is now the trustee.  They can either rely on the power of amendment in the governing document (if there is one) or use the statutory power within section 280 of the Charities Act 2011 to make this amendment.  Once the amendment has been made, the trustees should inform us by completing the online amendment form’.

In replying to the Commission I pointed out that the Cabinet papers I had sent them made it clear that the Council was not taking over as sole trustee but appointing a majority of trustees. ‘This seems to me to pose lots of conflicts of interest.’

I drew the Commission’s attention to Inside Croydon’s review of the overlapping involvements of Councillor Mead and his wife, inc. with Fairfield Halls and London Mozart Players. (http://insidecroydon.com/2013/05/08/councils-mr-mrs-act-that-defies-proper-declarations).

Commission Starts Inquiry

The Commission reply on 24 May apologised ‘if your original e-mail was misinterpreted however it may be helpful if I clarify that we are re-considering the information you have provided to determine whether there is any regulatory interest for the Commission.’

Its investigations dragged on. On 22 October this was explained to me as follows: ‘As detailed in my email of 20 August the matters you raised with the Charity Commission's First Contact department have been forwarded to the London Operations team and I have been looking into your concerns. I can confirm that we are still engaging with the charities and we will notify you of the outcome when we have finished our case. Due to resource issues we are not able to provide ongoing updates to you with regards to the case so sometimes it can take a while before you hear from us with the outcome.’

Commission’s Conclusions

The Commission’s reply to me (6 January) states:

‘I have considered the information you identified and the information provided by the trustees of the charity in line with the Commission’s risk framework when deciding if any further action should be taken.

The page on our website How we regulate charities sets out our approach to regulating charities. We are obliged to abide by the principles of best regulatory practice in our work. We will use our powers proportionately according to the nature and level of the risk and our potential impact. Even where we have regulatory concerns and do take further action, it may not, in some instances, be proportionate for us to investigate a charity. Sometimes the best use of our resources, and the best impact, will be achieved by us focussing on providing corrective regulatory advice and guidance to put the charity back on a secure footing.

During on going correspondence with the charity the trustees were asked to provide information related to the status of the proposals, any legal advice they had received and the basis of their decision making. The charity has now confirmed that the Council has decided not to pursue the proposals you identified. However, the charity informed us that the Council has made further proposals which would be likely to need the consent of the Charity Commission. These proposals are still being discussed and it may take some time for both parties to discuss and negotiate the proposals properly. We will be contacting the charity again in due course to get an update and to ensure that the plans are appropriate.’


My paper 'The Future of Fairfield Halls' to the SCCA inquiry can be seen http://southcroydoncommunityassociation.files.wordpress.com/2013/02/the-future-of-fairfield-halls.pdf

my email: sean.creighton1947@btinternet.com 

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