The current statutory obligation on the Commission, relating to removing charities from the Register, says that the Commission will remove from the Register an institution which it no longer considers is a charity. This would include both organisations which never have been a charity, but which the Commission registered in error, as well as organisations which may have been a charity but, because of a change in the law, the Charity Commission no longer considers it is. The wording proposed in the draft Bill would deal only with the second case and not the first. This is because the wording presupposes that the organisation’s charitable status has changed. In practice, because of the haste with which existing organisations had to be placed on the Register in the early 1960s after the Register was first created, there are many organisations registered which perhaps, looked at now, can be seen never to have been a charity. It is important that the Commission should be under an obligation to remove those and should not have to create a fiction that they were charitable but no longer are.

This is extremely important in the context of the charity’s assets. If an organisation was never a charity but was registered in error, then there is no difficulty about that organisation retaining its assets on ceasing to be registered. If an organisation was a charity but now is removed because it no longer is, then its assets (as the current law stands) will have to be applied cy-près and cannot be retained by the organisation.