Calderdale Metropolitan Borough Council is the first local authority to be given an Official Warning for failing to comply with its duties as trustee of 13 charities.
Calderdale is one of over 1,200 councils across England and Wales that are trustees of charities. Charities overseen by this council include several assets which are important to the local community, such as Bacup Road Recreational Ground, Tetley Memorial Park and Public Central Library.
The regulator’s Chief Executive recently wrote to all local authorities warning them of the “significant administrative headaches” councils could face from any failure to correctly comply with their duties. In his letter, David Holdsworth advised charities to keep a register of charitable assets and land held to help ensure any council correctly manages them in their capacity as a trustee. Failing to correctly identify charitable assets could lead to the loss of public facilities that people rely on and, where charity law is not correctly followed, intervention by the Commission.
As trustees, councils are responsible for running the charity and managing its assets as well as upholding all duties expected of any trustee. This includes filing annual returns with the Charity Commission.
Calderdale Metropolitan Borough Council has failed to file annual returns and accounts for all 13 charities, which have been overdue for several years. The Official Warning states that this, and the council’s failure to comply with an action plan the Commission issued to it in 2023, amounts to misconduct and/or mismanagement in the administration of the charities.
To rectify the misconduct and/or mismanagement set out in the Official Warning, the council must file all outstanding accounts. The Commission has been clear that Calderdale Metropolitan Borough Council also needs to:
- implement processes to ensure all 13 charities are compliant with their accounting responsibilities going forward
- provide up-to-date contact details for all charities
- locate and identify all 13 charities on a local register containing details about the charities and their assets
- hold regular trustee meetings, ensuring all councillors are aware of their duties and responsibilities – treating all charities as separate entities
- review financial controls of all charities, taking steps to record and implement processes as well as provide evidence of this action to the Commission.
