Reclaiming the concept of public benefit

At the heart of what it means to be a charity in the UK is the concept of ‘public benefit’. It is what sets us apart from other organisations, and it is the other side of the bargain that provides us with the advantages of tax breaks and high levels of public trust.

Public benefit has always been a rather loose concept. This changed after the Charities Act in 2006, which finally made it explicitly a part of what it means to be a charity. Under the definition given by the Charity Commission, charities must have identifiable benefits to the public and it must be clear what these benefits are. Moreover, people in poverty must not be excluded from these benefits.

Over the last two years, this definition has generated many hours of debate.

Perhaps inevitably, this debate has been dominated by lawyers. In particular, there has been a furore surrounding the status of fee-paying independent schools, most of which are charities under UK law but – let’s be honest about it – have drifted away from the spirit of their original aims.

In the squabble, the sense of what public benefit is and why it matters has been lost. The majority of the 170,000 registered charities in the UK, who need not worry about their status, and the hundreds of thousands of people that they help, have been forgotten.

It is time to reclaim the debate on public benefit.

One implication of letting lawyers dominate the discussion has been that it has been too narrowly focused on what we mean by doing good (for example, in the case of independent schools, answering the question of whether providing education that requires the beneficiary to pay a substantial fee can be considered charitable).

Is this enough to ask of charities? Surely there is a second element – being good at what you do – which should also be part of any definition?

The Charity Commission requires charities to report on public benefit in their annual report. Alongside details about what services they are providing and who is benefiting, why shouldn’t this also include an explanation about what differences they have made to people’s lives? If they are to continue to benefit from the privilege of charitable status then why shouldn’t they tell us what they are achieving and what processes they have in place to make sure they are as good as they can be?

To really benefit the public, the debate about public benefit must be opened up to a wider audience. We need to move beyond the distracting legal quarrels and focus on what is really important – making charities work better for their beneficiaries.