19 March 2019 - Article
From 19 September, charities will need to ensure they comply with the terms of the Transparency of Lobbying, Non-party Campaigning and Trade Union Act 2014 (the ‘Lobbying Act’).
Under the new rules, charities that undertake activities which result in ‘controlled expenditure’ must register with the Electoral Commission (EC). Once registered, charities are subject to limits on the amounts they can spend on campaigning activities and must make regular reports to the EC.
Activities which could result in ‘controlled expenditure’ now include:
- distributing materials to the public;
- spending on public events;
- press conferences;
- transport; and
- all associated staff costs.
Costs associated with these activities will be controlled expenditure if the EC considers they can ‘reasonably be regarded as intended’ to promote or oppose the electoral success of a party, candidate or group of candidates and are aimed at, or seen/heard by, the public. This is an objective test, so while charities may not consider themselves to be supporting a particular candidate or party, if they promote particular policy issues they may be regarded as supporting party/candidates who support the same policy positions. According to EC guidance, a charity’s ‘committed supporters’ do not constitute the public.
Non-party campaigners are required to register with the EC if their controlled expenditure exceeds £20,000 in England or £10,000 in Scotland, Wales or Northern Ireland within the ‘regulated period’. For the coming election, that period is from 19 September; in future years, it will be the 12 months preceding an election. There is a spending limit of £9,750 in any one constituency and overall limits for England, Scotland, Wales and Northern Ireland.
Charities registered as non-party campaigners will need to make quarterly reports to the EC of donations they receive in respect of campaigning activities and weekly reports during the period between the dissolution of Parliament and election day. Failure to comply with the reporting requirements could result in a court ordering a charity to forfeit an amount equal to value of the relevant donation.
In addition to existing Charity Commission guidance, the EC issued guidance on the Act in July (and updated it at the end of August). The guidance for charities can be seen here: www.electoralcommission.org.uk/__data/assets/pdf_file/0010/165961/intro-campaigning-charities-npc.pdf
Following implementation, charities will need to consider whether they spend more than the given limits on qualifying activities that could reasonably be considered as intended to influence voters. If so, they will need to register with the EC as non-party campaigners and begin tracking their spending.