Nurseries and childcare providers: is the Charity Commission now assessing the quality of your provision?

25 August 2017

The Charity Commission recently concluded an inquiry into an independent school. In its report the Commission touched upon issues relating to the quality of the school’s educational provision and its failure to comply with school regulations. This same approach could also be applied to any registered charity which carries on a nursery, play group or out-of-hours service regulated by Ofsted. Will the Commission now start assessing the quality of their educational provision?

Background

The Charity Commission launched the statutory inquiry into Rabia Educational Trust in May 2016. The charity operates an independent Islamic school, The Rabia Girls’ and Boys’ School, in Luton. The inquiry followed several years of correspondence with, and visits by, the Charity Commission.

The inquiry report noted:

“Whilst the Commission does not investigate matters relating to education standards in schools, it is the responsibility of the trustees to ensure that the charity complies with other laws that relate to the charity and its activities. The Ofsted report and Sir Michael Wilshaw’s letter [to the Secretary of State of Education] raised the level of the Commission’s concerns about the charity and its management by the trustees.”

Inquiry

The Charity Commission’s inquiry was therefore opened in order to investigate:

• the administration, governance and management of the charity by the trustees;
• the financial controls and management of the charity; and
• the conduct of the trustees and whether or not they had complied with and fulfilled their duties and responsibilities as trustees under charity law, including compliance with other laws relevant to the charity and its activities.

Findings

The inquiry concluded that there had been numerous examples of mismanagement and misconduct by the trustees in the administration of the charity over a number of years. This included:

• repeatedly failing to submit the charity’s accounts and annual returns on time;
• failing to address concerns previously raised by the Charity Commission;
• failing to comply with an action plan issued by the Charity Commission; and
• failing to obtain the Charity Commission’s consent before disposing of charity land to connected parties.

Significantly, the Charity Commission also noted that the charity had repeatedly failed to comply with the legal requirements and regulations overseen by Ofsted and the Department of Education. In particular, the Charity Commission’s inquiry report cross-refers at several places to Ofsted’s published reports and a critical letter from Ofsted’s then Chief Inspector, Sir Michael Wilshaw.

As well as making other directions, the Charity Commission therefore directed the trustees (under section 84 of the Charities Act 2011) to address these regulatory concerns by appointing someone with expertise in the Education (Independent School Standards) Regulations 2014 (known as “the Independent School Standards”) to ensure that the charity’s schooling met the statutory requirements.

Wider issues

It is highly unusually for the Charity Commission to steps into questions of educational quality – territory usually occupied by Ofsted – and it remains to be seen whether or not this is an exceptional case.

The principal matters of concern to Ofsted here related to incidents of gender segregation and inappropriate religious speakers, which also crosses over into the Charity Commission’s "public benefit" remit in relation to non-discrimination and preventing extremism.

In this instance, the intervention concerned an independent school. But, on the same basis, it is well imaginable that the Charity Commission could intervene if, for example, Ofsted found that a nursery, play group or out-of-hours provider with charitable status had inadequate safeguarding policies and procedures. After all, these matters also go to the question of whether or not charity trustees are discharging their duties and the charity is providing "public benefit".

What is likely is that, if the Commission already has regulatory concerns of its own, it may draw upon evidence collected by other statutory regulators to support its investigations and, if appropriate, to broaden their scope to ensure matters of concern are fully addressed.

Chris Hook?is an solicitor?in Newcastle upon Tyne.?He provides specialist legal advice to charities, social enterprises and educational institutions on a wide range of charity, commercial, regulatory and public law matters.?

Disclaimer: This article contains information which is necessarily general. It does not constitute legal advice. It is essential that, before proceeding with a particular course of action, you take specialist legal advice on any relevant considerations which may apply in your specific circumstances so that you can properly assess your options and any associated risks and benefits.

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