§ [SECOND READING.]
§ Order of the Day for the Second Reading read.
§ LORD PARMOOR
My Lords, the purpose of this Bill is aptly denoted in the title, and its objects are further and concisely stated in the Memorandum attached to the Bill itself. The real purpose of the Bill is to provide for the application of charities where there has been a shifting of the population, and the Bill is limited to town areas where the difficulty has been found to arise in the proper application of charitable funds through the population intended to benefit by them having moved out of the particular area. Your Lordships will note in the form of the Bill that it is limited either to municipal boroughs or to parishes or defined districts within municipal boroughs.
It is not necessary for me to explain to your Lordships what has been going on in many of our larger towns in regard to the shifting of the population from places in which it was settled years ago to outside districts or to the suburbs. That may have arisen from the beneficial effect of clearing out some slum area or because a manufactory to which the working population was attached had itself gone outside the town where it was originally situated. So far as the Bill itself is concerned, the difficulty is dealt with in a reasonable and practicable manner. The principle is that in the application of charitable funds the purpose of the donor should as much as possible be carried out, and in order to do that you must follow the population in reference to which the donor intended the benefits to apply in the first instance. In fact, when dealing with charitable funds of this character you can apply only one of two principles. You must either follow the population and confine yourself to the original purpose, which I suggest is the right doctrine, or you must apply in some form what is called the cy-près doctrine—that is, find some analogous purpose because the population to which the original purpose is applicable has shifted to some other area.
The Bill is carefully safeguarded as regards its provisions, and I will call your Lordships' attention to what the safeguards are. In the first place, nothing can be done under the Bill except by scheme 422 of the Charity Commissioners or by an application to the High Court of Chancery; and in the case of any scheme made by the Charity Commissioners all the safeguards of the Charitable Trusts Acts, 1853 to 1894, are made applicable. That means that where the original purpose can be carried out no change is to be made, and that so long as that purpose can be effectively carried out the principles laid down by the donor himself are to be carefully followed. In addition to the safeguard that a new proposal can only be carried out by scheme made either by the Charity Commissioners or by the High Court of Chancery, your Lordships will find that it is provided that no application can be made at all except by the trustees or other persons acting in the administration of the charity or by a majority of those persons. That, of course, is a safeguard of a very important kind. It provides that the initiation can only come from the persons primarily interested in seeing that the real purposes of the charitable fund are properly carried out.
There is one exception, and one only, and that is in accordance with the general principle of the Charitable Trusts Acts. The only exception is that application may be made of his own initiative by the Attorney-General to the High Court of Chancery. So that unless the application is made by the Attorney-General himself it cannot be made without the assent of the trustees or persons acting in the administration of the particular charity. That is a safeguard which I think is essential in a Bill of this kind. It not only provides that the local interest should be properly protected, but it leaves the power of initiation wholly in the hands either of the trustees or of other persons who are acting in the administration of the charity. There is a further safeguard in the same clause by the incorporation of Section 17 of the Charitable Trusts Act, 1853. I do not want to be too technical upon a point of this kind, but the effect of the inclusion of that section is that no movement can be made at all so far as the Charity Commissioners are concerned without their authority is given by the trustees or managers in the first instance. So that you have the public guarantee as regards the first step, and you safeguard what is subsequently done by limiting it to the initiation either of the trustees or of the managers acting in the administration of the charity.
423 Then there are certain exceptions which have necessarily to be made in a Bill of this kind. In the first place, all educational endowments are excepted. The reason for that is that educational endowments are now dealt with in a special manner by the Board of Education. They are no longer under the authority of the Charity Commissioners, who are the public authority responsible as regards other public charities in this country. Secondly, there is the provision, which has really been adopted from the Local Government Act, 1894, Section 14, that no charity is to be affected without its being in operation for forty years; and if the donor, or one of the donors, is still alive it is not to be affected until forty years from the passing of this Bill. Again, the City of London is not brought within the purview of the Bill. Your Lordships may remember that in 1883 an Act was passed which dealt exhaustively with the charities in the City of London. One of the difficulties in that case arose from the shifting of population, which has gone on to a very large extent as regards the City area; but as all the City of London charities were adequately dealt with in the Act of 1883 they are exempted from the purview of this Bill.
There is another provision to which I think I ought to call attention. So far as the main object of the Bill is concerned, it does not affect the purposes for which the charity can be used but only the area in which it can be applied. As I have already said, that is a most important provision as regards the proper administration of charities in this country. But there is a provision which allows dole charities—that is, charities which are provided for by the distribution of money or kind—to be applied, under certain safeguards, for other purposes. For a long time it has been recognised that dole charities have not really performed the purposes for which they were originally initiated, and there have been very strong comments on various occasions that dole charities could be more properly utilised in other ways and for other purposes. Many years ago, in the case of the Camden charities, attention was called to the fact that, whereas a few shillings used to be given for dole charities in Kensington, by the growth of the population and the growing value of the property that had increased to several hundred pounds. It was pointed out on that occa- 424 sion that unless dole charities of that kind could be applied for other purposes, not only was their object lost, but they could be used in a way that brought about evils rather than benefit to the poor in any particular locality. And your Lordships, I dare say, will recollect that in a Report which contains much valuable information but which has not been very much acted upon up to the present time—I mean the Report of the Royal Commission on the Poor Laws and Relief of Distress—there is a special recommendation dealing with dole charities, and especially suggesting that they could be more fully applied if they were utilised for wider purposes. In this Bill the proposal is that, under certain conditions, these dole charities may be applicable for the relief of distress or sickness, or for inproving, by such means as may be provided in the scheme, the physical, social, or moral condition of the poor in the area as extended. Therefore you see that the area is maintained, but in that one case, and in that one case only, there is a change in the purpose—a change which I suggest to your Lordships is beneficial having regard to what has been the general experience of those who have been engaged in the administration of charitable funds.
In order to prevent any misunderstanding, I should like to add that bringing the schemes in this case under the Charitable Trusts Acts, 1853 to 1894, amply guarantees such funds which are used for what are called denominational purposes against any alienation or diversion. All those Acts guarantee that where church or religious funds are being used for church or religious purposes they should be so used and not diverted into any alien direction; and this Bill, by incorporating the provisions of the Charitable Trusts Acts, 1853 to 1894, incorporates all the safeguards that ought to be incorporated in order to preserve as nearly as possible the carrying out of the original wishes of the donors in connection with charitable funds left for the public benefit. The true object of trust funds is to have a continuity of purpose over a period of time. This protects the use of funds from what I may call the caprice of temporary change of opinion. If you desire that trust funds should be so dealt with you must give a certain reasonable latitude in order that the purposes to which they are applied may be as beneficial 425 as possible, and it surely is a beneficial change where you find that the population has shifted as regards a town area that you should apply the charitable trust fund to the old purposes intended by the donor and for the very classes whom the donor intended to benefit. I ask your Lordships, therefore, to give a Second Reading to this Bill. I hope that if there is any difficulty of a technical or legal kind it may be called attention to at a subsequent stage; and perhaps I may appeal to the Lord Chancellor whether on these grounds he feels that it is likely that there will be any objection to a Bill of this character.
§ Moved, That the Bill be now read 2a.— (Lord Parmoor.)
§ THE LORD CHANCELLOR (VISCOUNT HALDANE)
My Lords, I congratulate the noble and learned Lord on the lucidity of his exposition of this Bill, and on the care with which it has been drawn. I have read the Bill tentatively, and I think it is one of the most useful Bills of the kind that has been introduced for some time. It is just such a Bill as originates naturally and properly in this House, where we have more time to deal with these matters than is the case elsewhere. The Bill is carefully safeguarded. It applies to old charities only, to charities more than forty years old, and it embodies two principles—one, the extension of the benefits of charities where the population has shifted beyond the defined area; and the other, the application of the cy-près principle to the administration of doles. Both of those are very valuable changes in regard to the class of charities concerned, which to-day on account of legal technicalities are not being applied to the purpose which the founders really intended. This Bill gets over those difficulties, and it is careful so far as the original intentions of the donors are concerned. It is adequately safeguarded, and its purpose is so useful that I have every hope that it will have as good a reception elsewhere as I believe it will have in this House. Speaking for the Government, I can say that the Government warmly approve of the Bill and will give it every assistance in their power.
§ On Question, Bill read 2a, and committed to a Committee of the Whole House on Tuesday next.