§ Mr. Arthur Lewis
asked the Secretary of State for the Home Department whether, in the light of the growing practice of registered charity organisations charging excessive costs for expenditure in 297W collecting charity, and paying very large salaries, expenses and tax benefits to their full-time staffs, he will take action, if necessary by new legislation, to control such expenditures to a reasonable figure.
§ Mr. Merlyn Rees
Under the House to House Collections Act 1939, a licensing authority may refuse or revoke a licence where it appears that the amount of money to be applied for charitable purposes is inadequate in proportion to the proceeds of the collection, or that anyone will retain or receive excessive remuneration from the proceeds. More generally, the matters referred to in the Question are among those which the Charity Commissioners may take into account in deciding whether to exercise their powers of inquiry into the affairs of a registered charity under the Charities Act 1960.
I would, however, draw my hon. Friend's attention to the view expressed by the Committee on Charity Law and Voluntary Organisations under Lord Goodman's chairmanship in paragraph 220 of its report that, in regard to the proportion between expenditure on administration and the amount of money available for charitable purposes,it is impossible to lay down any uniform rule. The differences between fund-raising charities and endowed trusts, between those who collect money and pass it on to other charities and those who do charitable work themselves make it impossible to define any limit. Saving on administrative expenses is not always an effective criterion by which to judge the efficient use of charitable resources, as weak administration can often lead to wastage and loss of effectiveness.