Contents

Summary

Chapter 1: Introduction

The changing role of charities

The focus of the Committee

Figure 1: Voluntary organisations by area of activity (2013/14)

The work of the Committee

Chapter 2: The history and shape of the charity sector

Charities and charity law

Regulation and the role of government

Box 1: Exempt and excepted charities

The shape and funding of the charity sector

Figure 2: Proportion of charities by annual income and proportion of the income of the sector that they receive

The contribution of charities

Chapter 3: Improving governance and accountability

Good governance

The role of trustees

Trustee skills

Trustee training

Board diversity and turnover

Diversity of the Charity Commission’s board

Executive leadership

Payment of trustees

Transparency, accountability and impact

Financial reporting

Governance reporting

Evaluation and impact reporting

Chapter 4: Funding: grants, contracts and commissioning

The decline of public sector grants

Figure 3: Charities’ income from government contracts and grants, 2000/01 to 2013/14 (£bn, 2013/14 prices)

Charities and contracts

Commissioning processes

Commissioning skills and co-operative development of contracts

Public Services (Social Value) Act 2012

Financial and planning challenges

Payment by Results

Core costs

Duration of contracts

Innovation by charities

A revitalised role for grants

Chapter 5: Supporting sustainability

Fundraising

Economic and tax policy

Support within the charity sector

Role of volunteers

Expectations and trust

Mergers

Closures

Chapter 6: Charities and digital technology

The potential of digital technology

Digital fundraising

Awareness raising

Engagement

The challenges of digital for the charity sector

Helping charities to embrace digital technology

Chapter 7: Alternative forms of charity finance

Social investment: potential and barriers

Social investment and small charities

Investment capacity and skills

Investor expectations

Social Impact Bonds

Chapter 8: Regulation and the role of government

Office for Civil Society: priorities, initiatives and sector engagement

Local government engagement

Charities and devolution

National and local compacts

Legislation

The role of charity advocacy

Impact on charities of the UK’s departure from the European Union

Regulation of the charity sector

Summary of conclusions and recommendations

Appendix 1: List of Members and declarations of interest

Appendix 2: List of witnesses

Appendix 3: Call for evidence

Appendix 4: Note of Committee visit to Body & Soul

Appendix 5: Note of Committee visit to the Charity Commission

Appendix 6: Note of Committee visit to Manchester

Appendix 7: Note of roundtable discussion in Westminster

Appendix 8: Note of roundtable discussion in Cardiff

Appendix 9: Acronyms

Evidence is published online at http://www.parliament.uk/charities-adhoc and available for inspection at the Parliamentary Archives (020 7219 3074).

Q in footnotes refers to a question in oral evidence.