Tom
Levitt: I may have looked as though I was raising my hand,
but I was indicating that only one Labour Back Bencher made the
argument that the hon. Gentleman is
describing.
James
Duddridge: I forgive the hon. Gentleman. I have got
Hansard, but —I thought the hon. Member for Stroud
(Mr. Drew) and another hon. Gentleman made the point and they referred
referring to a larger level of support. However, I am more than happy
to look at Hansard and talk to the hon. Member for High Peak
after the debate.
Mr.
Bone: Have not the Government missed a trick? Should they
not be encouraging private education rather than restricting
it?
James
Duddridge: I agree. Given the wonderful new Labour phrase
“direction of travel”, it is entirely inconsistent that
there should be a blurring of the lines between the public and private
sectors but that more is not being made of the charitable sector in
independent schools and in the health sector. My hon. Friend makes a
good point; the Government seem to be going in the opposite
direction.
Martin
Horwood: The hon. Gentleman continues to portray the
amendment as an attack on private schools, despite my assurances to the
contrary. Will he explain why the head teacher of Dean Close school in
my constituency, whom I quoted on Second Reading, supports stricter
guidance on public benefit and says that his school has nothing to fear
from
it?
James
Duddridge: I welcome that intervention, but I speak for
myself not for the head teacher of a particular school. I am aware that
the Independent Schools Council has taken a certain view. It has
written to hon. Members saying:
“For each £1 of
fiscal benefit, schools give back £3 in help with fees and other
charitable giving, plus a further £2 in irrecoverable
VAT”. All that is on top
of some £2 billion that the Government would have to spend to
educate people in the public sector. Although I am not a lawyer, re
Resch touched upon that issue. It seems that public schools have a
clear public benefit, and the biggest benefit is that £2
billion.
Mr.
Turner: I have never spoken to the head teacher of Dean
Close school, but I recall that when the hon. Member for Cheltenham
mentioned that institution on Second Reading, the public benefit
appeared to be the use of its theatre. Similarly, the public benefit to
be gained from other independent schools appears to be the use of their
sports facilities—or even the rowing trenches that were built at
huge expense near Slough. Is not the really important public benefit
that is to be
derived from public education that people are taught and that they
learn—and that they and the nation are better as a
result?
James
Duddridge: My hon. Friend makes the point incredibly well.
I agree that that is the overwhelming public benefit. However, that is
not to say that there are not other public benefits.
I congratulate the Government
on their general push to encourage fee-paying charitable organisations
to demonstrate greater public benefit. Withdrawing the presumed public
benefit is not right; there are other methods over and above the
presumed public benefit that could encourage, if not compel, those
schools to be more involved in the community. A number of points were
made in the Chamber on those questions and what I have described would
be a much better way forward than withdrawing the presumption of public
benefit.
Tom
Levitt: I was fascinated by the suggestion of the hon.
Member for Wellingborough (Mr. Bone) that, because a group of
organisations pays tax, they contribute to the public benefit. He said
that the money that private schools contribute to the economy should be
regarded as a public benefit. I therefore look forward to being
classified as a charity because I too pay tax, although not to the same
extent. The hon. Gentleman would extend public benefit rather further
than do the clauses on charitable purpose that we have already
considered. During
the 20 minutes of that six-and-a-half hour Second Reading debate that I
was out of the Chamber, my hon. Friend the Member for Stroud spoke. I
therefore accept that two Labour Back Benchers were expressing that
view, not one. Another, whom I heard loud and clear, was my hon. Friend
the Member for Selby (Mr. Grogan), although we seemed to reach some
sort of compromise in our exchange. I shall return to that in a
moment.
12.45
pm
James
Duddridge: Does the hon. Gentleman agree that Labour Back
Benchers are pressuring the Government to do more in their attack on
independent schools? That is one reason why the Parliamentary Secretary
would be so clear, forthright and assertive towards that sector. Indeed
a number of people hold similar
views.
Tom
Levitt: The hon. Gentleman should not believe everything
that he reads in the newspapers. Certainly there are people who are
opposed to public schools in principle. I was disappointed by the
number of my colleagues who set their face so firmly against trust
status arrangements for local authority schools, but I do not think
that there is a one-to-one correlation between those two points of
view. As I said on
Second Reading, I have been in the Labour party for 30 years and I am
uneasy about the idea of private education. It seems to be intended to
bring about privilege rather than pure educational value. That
privilege is bought in a way that others cannot afford. Teachers who
are very often trained at the public expense are then taken out of the
state
system and used in the private sector. Those are things that have
worried people in principle on our Benches since time immemorial. But
we are where we are. In the big church that we advocate on the Labour
Benches we take many views on board. Indeed, the private education
system has produced some excellent and senior members of the Labour
party. I am sure that it will continue to do so. But that does not mean
that we all have had Pauline conversions. I accept that the private
sector, especially in the field of special education, provides
facilities that the state sector then buys into. That is very valuable.
I think in particular of institutions such as the Mary Hare school in
Berkshire that are provided on a scale which it perhaps would not be
cost effective for the state to fund. The state then buys in so that
people whose special needs necessitate it can be educated in the
private sector. We are seeing the same in health with operations being
bought from the private sector in order to fulfil public need and on a
public service basis. In other words it is at no cost to the
individual. All those
examples of partnership are valuable. This part of the Bill had a
hugely disproportionate amount of scrutiny when it was in another
place. I hope that we will not spend the same proportion of our time
discussing public benefit. But this Bill is not about the status quo as
far as public schools are concerned. I believe it is right to end the
presumption that anything that has education in its purpose is
automatically a charitable purpose. There has to be a demonstration of
public benefit. I pay tribute to those schools in that sector that have
already started taking those moral responsibilities seriously. Some
public schools are allowing and encouraging the joint use, community
use or shared use with other schools of drama facilities, sports
facilities or wider school facilities. It may be for summer clubs
during the holidays or to help students on pre-university courses. I
welcome those examples of partnership.
If the Bill goes further along
the road of promoting those partnerships and making sure that the use
of those facilities which have hitherto only been the prerogative of
the few and the wealthy few, by and large, it is, dare I say it, almost
socialist in action and is therefore to be welcomed. The Bill is right
that where the public benefit cannot be demonstrated and where there is
total exclusion of the public from the use, then charitable status
should be withdrawn. But I note that even if every public school were
to fail on the public benefit criterion, only something like 4 per
cent. of the income of public schools would be removed from
them. While 4 per
cent. is useful for them to have and encourages them into the
partnerships that we are advocating, it is not a death blow to them
should it be removed. Nevertheless, it is important to have the
opportunity to say that there is no public benefit from an institution
and that its charitable status should therefore be
removed.
Martin
Horwood: I am enjoying much of what the hon. Gentleman is
saying and I agree with a great deal of it, but he might have been
wrong on one point of detail. If a public school were by any chance to
lose its charitable status, that would be a much more serious matter
than just losing 4 per cent. of its income,
because, as a non-charitable institution, it would not be able
to use the charitable assets that it had accumulated. Charitable assets
must remain charitable.
Tom
Levitt: Yes, I had not thought of that aspect. I do not
know what happens to an organisation’s assets when it loses its
charitable status or whether they are affected in that way, but I am
willing to take the hon. Gentleman’s word for it. I am not
advocating that we should remove the 4 per cent., but that schools
should behave in a way that guarantees that they continue to get
it. On this issue, I
regard the Bill as progressive. I shall not dismiss the amendment
tabled by the hon. Member for Cheltenham as upholding the Cheltenham
principle, because it is important that we air these matters. Although
we should not adopt the words that he has proposed, we have had a good
debate on this subject. We should acknowledge the fact that the issue
has undergone particular scrutiny in the other place, adopt the clause
as it stands and move on.
Alun
Michael: I am grateful for the opportunity to make a
couple of brief points, and I hope that we can use the debate to
clarify beyond doubt the issue of the public benefit test. There has
been a great deal of scrutiny of the provisions, and I hope that the
Minister will be able to confirm my understanding of what is happening
in them. I understand
why the hon. Member for Cheltenham has tabled the amendment.
Essentially, he is saying that having included environmental benefit,
for instance, in the list in clause 2(2), there is a danger that the
consideration given to the public benefit might lead to it being ruled
out again. I can see the point of that, and if we deal with these
issues in everyday language, there would appear to be such a
danger. However, my
understanding is slightly different. We are muddling up two issues.
First, there is a series of specific benefits, which are recognised in
the list of charitable purposes in clause 2(2). Environmental benefit,
animal welfare and so on are clearly understood as charitable purposes.
The public benefit test, therefore, must be a test of the extent to
which those purposes are delivered and of whether the way in which the
charity is acting is appropriate to delivering them.
However, it would be
wrong—this is the fear that the hon. Gentleman is
expressing—to return to the list and say, “You cannot
identify individuals and groups in the community that get that benefit,
so we can overturn its inclusion in the list.” That cannot be
right and it cannot be the intention. The public benefit test does not,
and cannot, allow the Charity Commission to question whether the
charitable purposes listed in clause 2(2) are indeed charitable. From
this point on, that must be a given.
The public benefit test relates
to the extent to which the charity delivers charitable purposes
consistently and appropriately, as against all the other tests of what
is charitable, which is very clear, having been set out in previous
legislation and in case law.
Mr.
Turner: Perhaps the right hon. Gentleman will correct if I
am wrong, but he is saying that if a cause occurs under clause 2(2), it
is not only a purpose that has the potential to be charitable if it
demonstrates that it is to the public benefit, but affects the way in
which the Charity Commission will test whether it achieves the public
benefit. The Chancellor of the Duchy of Lancaster has said that there
has always been a view that public benefit ought to be able to be
demonstrated. How does the hon. Gentleman think that the charity
concerned could demonstrate that it is to the public benefit in this
purpose; that is, to the advantage of environmental
protection?
Alun
Michael: Let me put it in terms of animal welfare, since
that has been the subject of debate over many years. The argument
against animal welfare would be that it does not produce a public
benefit, because it does not benefit people. The other side of the
argument is that there is actually a public benefit to being concerned
about the welfare of those with whom we share the planet. Therefore, a
public good comes out of animal welfare that may not benefit human
beings individually or as a group. That also applies to some of the
charities on Isle of Wight, to which the hon. Gentleman referred
earlier. Surely, by listing animal welfare, the definition has put
beyond doubt the fact that there is a public benefit in pursuing
it. Similarly, there
could be consequences in terms of the environment and national parks,
with people going out for recreation and enjoyment, and so on, but the
environment is mentioned in clause 2(2), which puts it beyond doubt
that landscape and environmental benefit is a charitable purpose.
Therefore, it cannot be said, using the test of public benefit, that
that is not charitable. It would be wrong to have a presumption that
any organisation that sets itself up, saying, “I am
environmental”, is not subject to question through the
“public benefit” test. Such organisations have to be
asked, “Are you pursuing that charitable purpose appropriately
and efficiently and have you passed all the other tests that are
traditionally accepted as the ones that check whether a charity meets
its
purpose?” The
amendments may result in a danger that clause 2(2) could be
revisited and overturned by the public benefit test. Surely, that
cannot be the purpose. I am discussing the matter in that way because I
hope that my hon. Friend the Parliamentary Secretary’s response
might help us kill off that fear, which has created an enormous amount
of the debate that took place in another
place. Debate
adjourned.—[Liz
Blackman.] Adjourned
accordingly at two minutes to One o’clock until this day at Four
o’clock.
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