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Bogus Charity Bag Collections Debate

October 13, 2010

Nick Hurd replies to a debate on bogus charity bag collections, fake charities and theft of genuine charity bags which deprive charities of funds and undermine public confidence.

The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd): It is a great pleasure to serve under your chairmanship, Mr Gray. I warmly congratulate my hon. Friend the Member for Chatham and Aylesford (Tracey Crouch) not only on securing the debate, but on presenting her arguments extremely forcefully. It is also important to register the presence of the hon. Member for East Dunbartonshire (Jo Swinson), who performed a similar useful exercise back in 2007, so she represents some continuity in terms of pressing the case for continued action on this extremely emotive and difficult issue.

As my hon. Friend said so well, we clearly have a problem. We all know, even just from walking the streets of our constituencies and knocking on the doors, that the public are more and more exposed to leaflets, bags and requests for information, and that is irritating them. There has been a change in the economic incentives underlying the behaviour that my hon. Friend is concerned about. Prices for second-hand textiles and clothing are at about £700 to £900 a tonne, so there is some serious money to be made.

The Fundraising Standards Board tells me that there has been a 100% increase in complaints to it over the past year. The media and various Members of Parliament are taking an interest in the issue, which is clearly serious. However, this is not so much about the sums involved or the cash cost to charities, which outside bodies estimate at between £5 million and £15 million a year. What concerns me is the issue of public confidence in charities at exactly the time when we want to encourage more people to give. This is clearly an important issue of public confidence.

Three types of collection activity potentially damage the sector’s reputation. The first is outright fraud, which involves fake charities adopting the names of real charities for their collections, pretending to be charitable and stealing clothes that are left on doorsteps; my hon. Friends the Members for Chatham and Aylesford and for Truro and Falmouth (Sarah Newton) identified such activities. The second area of activity involves misleading literature that gives the impression that there is a charitable beneficiary, when that is not in fact the case. The third area of concern is the actual theft of bags of clothing left out for legitimate charities to collect.

All that behaviour is absolutely reprehensible, but the question is what we can do about it, and I take on board the point that the issue has been raised over some time. A lot of activity is going on, but the question is how effective it is, and it is important to review that. There are three levers that the Government can pull: more and clearer regulation, enforcement and education. The Government’s position is that the challenge and the priority relate more to enforcement and education than to further regulation.

The regulatory base that is in place is sufficient, and, as my hon. Friend the Member for Chatham and Aylesford will know, collections are regulated under the House to House Collections Act 1939 and the House to House Collections Regulations 1947. Where collections are undertaken by a commercial collector on a charity’s behalf, the necessary commercial participation agreement under part 2 of the Charities Act 1992 must be in place. As a Government who see themselves as being in the business of deregulation rather than of adding to regulation, our instinct is therefore not to reach immediately for the regulatory lever, not least because we would be concerned about imposing additional costs and burdens on those who perform their activities in a wholly legitimate way.

My hon. Friend rightly pressed me about the implementation of the Charities Act 2006. She will be aware that it is due for review next year-there is a requirement on the Government to review its workings and implementation-and I have already made an explicit commitment in public that a review of the issues before us will be an explicit part of that process.

The honest answer to my hon. Friend is that if I thought that full implementation of that measure would transform the landscape and make a huge difference, I would have carried that out some time ago. In fact, the advice that I have received is that the net impact of implementation could be marginally deregulatory, in the sense that it would effectively replace the requirement to get a local authority licence to operate in a specific area with a requirement to get certification from the Charity Commission to operate anywhere. I am not entirely persuaded that that would solve the problem, but research is being conducted and, as I have said, there will be an explicit review of the issue in the context of the review of the Charities Act 2006. My hon. Friend has that undertaking from me.

Enforcement was a central concern of my hon. Friend the Member for Chatham and Aylesford. We look to various players in the field to make a difference and an impression: local trading standards officers, the police and, of course, those responsible for regulating advertising standards in the context of leaflets that are arguably misleading. The debate has prompted me to review what is going on, and on the face of it I am reasonably encouraged by the level of activity and what that tells me about the underlying concern of the agencies responsible.

For example, I welcome the work that the Fundraising Standards Board is doing with the Trading Standards Institute to develop a toolkit to guide all trading standards officers through the relevant legislation and through what evidence is needed to tackle bogus charity collections and effect successful prosecutions. As my hon. Friend will know, the process in relation to detection and evidence is extremely difficult. However, there is clearly partnership work going on to develop a toolkit that will help trading standards officers in that difficult work.

Tracey Crouch: I thank the Minister for what he has outlined, but I dispute whether it is difficult to detect the people in question. Quite often they clearly state where they will be, and at what time. It is misleading or misguided to think that it is difficult to catch them and find evidence. It is often very easy to catch the perpetrators in the act. I feel that sometimes it is not a question of catching them; it is a question of the process afterwards-prosecuting them. That is where the slow-down is.

Mr Hurd: I understand and accept the point that my hon. Friend makes. As to difficulty of detection I was thinking not so much of the person in the van as of the mastermind in the control room-the real villain of the piece. I also think that the public will play an increasingly important role in detection and evidence. For example, in my constituency we have rolled out the concept of neighbourhood and street champions, people who have value as the eyes and ears of public agencies, on a range of issues. In the present context they could play an important role in detection and evidence-gathering.

I was trying to summarise some of the welcome activity that I detect is going on among various agencies who are trying to work together to develop better practice. The Institute of Fundraising has a current consultation on its code of fundraising practice on house-to-house collections. That code will apply to all collections of money and goods made house to house, whether they are carried out by volunteers, fundraising organisations or third party agencies.

I note that the National Association of Licensing and Enforcement Officers is doing some work on developing guidance for local authority licensing officers on house-to-house collection of goods. I have looked again at what the Advertising Standards Authority is doing as the UK’s independent regulator of advertising. Again, I am satisfied that it takes the issue seriously and that its connections with the Office for Fair Trading are reasonably robust, so as to create the opportunity to act against those who mislead the public through advertising material.

The police’s sense of their local priorities clearly presents an issue, but the Office of the Third Sector, as was-it is now the Office for Civil Society-has been in regular contact with the Association of Chief Police Officers. I give my hon. Friend the Member for Chatham and Aylesford a personal undertaking to write again to ACPO to press the issue, and to raise the matter of cross-border co-operation that she specified.

The level of fines and the effectiveness of deterrence also needs to be considered. I understand that one of the maximum fines, for collecting without a licence, is about £1,000. There seems to be a mismatch between that and the price of a tonne of textiles, so again I shall write to the Ministry of Justice to explore its appetite for a review of the level of fines and deterrence.

To deal briefly with education, I have reviewed what has been done. My hon. Friend the Member for Chatham and Aylesford will know that the Office of the Third Sector was instrumental in co-ordinating the “Give with Care” campaign. It distributed about 500,000 leaflets around the country. That was relaunched in 2010. The Charity Commission has been extremely proactive, and keen to raise awareness of fraud and theft. The media, Members of Parliament and various other stakeholders have played an important part in raising the profile of the issue, notifying the public and encouraging them to report suspicious behaviour and perhaps to be more rigorous in checking the claims made on the material shoved through their letter boxes.

I acknowledge that there is a problem, and I congratulate my hon. Friend the Member for Chatham and Aylesford on raising it again. The more I look at the matter, the less easy it is to see an easy, quick-fit solution. The nature of the activity is in the shade and at the margin of the law. As I have tried to stress, our instinct is that the question is much more one of enforcement and education than regulation. There is a lot of activity and there are many programmes. The question has been raised-and I join in asking it-whether the activity is sufficiently robustly co-ordinated. Despite the levels of activity, there is always scope to do more and think harder about the issue. My hon. Friends the Members for Chatham and Aylesford and for Truro and Falmouth have both put some concrete, specific ideas on the table.

I want to close with an invitation to my hon. Friend the Member for Chatham and Aylesford: given the scale and complexity of the problem, it is time to convene a round table of those people who are actively engaged in trying to reach a solution. I will do that, and my hon. Friend is invited to participate in that event, given the leadership role that she has played, through tabling her early-day motion and obtaining the debate.

The challenge will be for the people around that table to think afresh, review what we are doing and consider whether we could take cleverer, more co-ordinated and more robust actions to get on top of the problem. There is clearly a significant risk that the problem will undermine the confidence of the British public in giving to charity, at exactly the time when we want them to give more.

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