Launch date: Wednesday 15th March 2000
Isn’t user involvement already a big part of any service-providing organisation?
The aim of the guidance is to clarify the legal position for charities who involve users generally and those that have trustees who are also users of the charity’s services. There has been widespread confusion about the legal position of a trustee who also benefits from their charity and this guidance should clear up any misunderstandings.
Can charities legally involve users?
There is no legal bar to user involvement.
Do you encourage user involvement?
User involvement is a good way of helping a charity to achieve its aims more effectively. It can cover a range of activities, including informal discussions with users, feedback questionnaires, formal user groups and so on. Every charity should try continuously to improve their services in ways that have a direct, positive impact on the lives of their users. Involving those users in shaping the services they receive is an obvious method of providing services that satisfy the needs of users and future users as effectively as possible.
Is one method of involving users better than another?
There is no “best” form. Different charities and users will find different methods of involvement more effective than others. Many factors may influence which method is most suitable, including the wishes and skills of the users, the type of service the charity provides, the charity’s stage of development, practices of similar charities and so on.
Can any charity have users as trustees?
Yes, providing there is suitable legal authority for a trustee to benefit as a user from their charity.
What would happen if a user became a trustee without legal authority?
There is a risk that any transactions that subsequently take place that are subject to a conflict of interest could be challenged. If a transaction, such as a grant, were successfully challenged, that money may have to be paid back.
What if a trustee knowingly receives a benefit without authorisation?
It depends on the size and nature of the benefit. There are some benefits that are universally available or considered to be inconsequential. For instance in a charity with a membership, the trustees may all be drawn from that membership and will receive the same benefits as all other members. This would not require particular authorisation. Neither would an inconsequential benefit, that is of little or no measurable value such as the provision of an advice sheet produced by the charity. If a charity is in any doubt as to whether specific authorisation is required, they should contact us for advice.
However, a trustee who knowingly receives a benefit that would not be considered universal or inconsequential, without authorisation, would be in breach of trust and may be required to pay back any gain he or she has made.
Of course, all trustees are entitled to the reimbursement of out of pocket expenses as a matter of course. No specific authority would be required for this.
Isn’t it rather patronising to say that if there are a third or fewer users as trustees that there are unlikely to be any problems?
We are not saying that there must be a third or fewer users as trustees. What we do say is that each charity must decide the most appropriate number of users as trustees. This may be some, none or all users as trustees. The key issue is to decide what level of user trusteeship will give the most effective management of the charity and its resources.
What is important for any board of trustees, regardless of whether or not they include users, is to guard against a group of trustees with a single interest or motivation taking control of the direction of the charity.
Can a charity be run by users?
Yes. The key issue is to decide whether by having all user trustees a charity has the most effective form of management.
You say that trustees need to absent themselves from meetings where they have an interest. Won’t all user trustees have an interest in anything the trustees discuss and if all of them are users, how will the charity function?
Our guidance differentiates between “direct” and “indirect” benefits. A direct benefit would be one that results in a trustee receiving something that will be personal to that trustee and not be shared with other users. For instance a personal grant of funds. In these instances we recommend that the trustee concerned does not take part in any discussions.
Indirect benefits would be those where the user trustee might receive something that would also be more generally available to other users outside of the trustee body or where it is a general policy or practice decision affecting a service that the user, along with other users, receives. In these cases we recommend that the user trustees take part in such decisions, but declare an interest before any discussions.
It is unlikely that a situation would arise where all the user trustees were likely to directly benefit from a decision at the same time. It is more likely that situations would arise for one trustee at any one time and the absence of one trustee for a part of a meeting is unlikely to affect the functioning of the trustee body.
Surely conflicts of interest aren’t restricted to user trustees?
No, of course they aren’t. Any trustee may find himself or herself in a position where his or her own interests and those of the charity appear to clash. The guidance we give can apply to any trustee who has, or potentially has interest that conflict with those of the charity.
Do you recommend a register of interests similar to that for MPs?
This may be one method of ensuring that a charity trustee is as open and transparent about any conflict, or potential conflict of interests. Obviously charities should ensure that such registers are regularly reviewed and that all trustees are clear about what level of potential conflict should be stated.
Many trustees may benefit from their charity by reading literature produced by the charity, gaining lifeskills by serving on the board or as members, may receive membership benefits such as free entry into charity premises where non-members may have to pay?
We are not concerned with benefits that are inconsequential or universally available to all users. Trustees should exercise their judgement about such issues. If they are in any doubt as to whether a benefit would cause a problem, they should contact us for advice.
What would you do if you found that a charity was operating purely to further the interests of the trustees?
Where we find that a charity is run for self-interest we would use our powers to correct the situation, ensuring that the charity remains wholly charitable. An organisation run for self-interest would not be charitable.
Many funders require a certain proportion of users on a charity’s trustee body before they will consider giving a grant. What if the governing document of the charity does not allow user trustees?
If this is the case, the charity should approach us for advice.
What if the users of a charity’s services are under 18 years of age?
No one under the age of 18 can become a trustee of an unincorporated charity (a trust or unincorporated association). There is no minimum age for directors of companies, including charitable companies. However someone appointed as a company director has to be old enough to understand his or her duties as a director.
If a charity wants to involve users who are under 18, they should consider methods other than appointing them as trustees. The trustees could set up a forum of users to advise on policy or service delivery. However, the final decisions made in the charity would rest with the trustees.
What if the charity’s users do not have the physical or mental capacity to become a trustee?
A person would not be able to become a trustee if they don’t have the capacity to manage their own affairs. It is therefore unlikely they could manage the affairs of the charity. However, this does not immediately exclude anyone who has learning disabilities or suffers from physical ill health. The other trustees should make a decision based on individual circumstances.
Charities can offer support to any person wishing to become a trustee, whether or not they are a user to make them as effective as possible. This support could include induction for all new trustees, use of plain English in all meetings and background papers, ensuring that all meetings are accessible in terms of physical access and timing, explanations of technical/financial issues for trustees without this expertise, a programme of continuing training and education about issues affecting the charity and trustees and so on. Use of these measures is helpful for anyone who is a trustee.
Even if a user was not willing or able to take on the responsibilities of trusteeship, they could be involved in many other ways.
How can you involve the users in animal charities?
The beneficiaries of an animal charity are not, in law the animals themselves. The purpose of a charity set up to relieve the suffering of animals is ultimately to promote the moral improvement of people. Therefore, everyone is a beneficiary.
Is the booklet available in different formats?
Yes, it is available in both audio and Braille.
Is it available in other languages?
It is available in Welsh, but not in any other language.
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