The Rolling Review in Scotland
Scottish independent schools are considering how to react to the new public benefit tests contained in its charity legislation, writes Simon Mackintosh
While England awaits guidance from the Charity Commission, Scotland already has some useful material to work with. We have a statutory test in the Charities and Trustee Investment (Scotland) Act 2005; and in the pilot studies for the Rolling Review by The Office of the Scottish Charity Regulator (OSCR) which give the first signs of some clear guidance as to how this test will be interpreted.
A period of uncertainty for Scottish charities ended in late July 2007 with the publication of OSCR’s report on its pilot study, designed to lead to the Rolling Review of all Scottish Charities. It is important to understand the limited scope of the Rolling Review: it is not a review of all of a charity’s activities, such as its standards and practice and governance structure: instead it is a much more limited “legal audit” under which the constitutions and activities of Scottish charities are checked against the charity test. Briefly, the charity test includes an extended list of charitable purposes, a specific requirement for public benefit, and a prohibition on ministerial control and party political activity.
Public benefit
Every one of the charities which took part in the pilot studies were found by OSCR to provide public benefit through their activities. This included the pilot independent school, the High School of Dundee, and a university (which also charges fees). In the case of fee-charging charities, OSCR’s view was that the charities provided a public benefit, and the fees levied did not make the charges “unduly restrictive” – the critical part of assessing fees and other restrictions on access.
OSCR admitted that the study of the High School of Dundee presented it with its most difficult challenge among the pilot charities.
The following main points emerged from the review of the High School of Dundee:
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the terms of its constitution were clearly within the charitable purpose “the advancement of education”;
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a wide range of activities was undertaken in furtherance of education, both curriculum and co-curriculum. Other activities included contributing to the development of the curriculum in Scotland, adding to the development of subject materials and reviewing qualifications, and providing markers and moderators, examiners and scrutineers for the Scottish Qualifications Authority;
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access to sports and other facilities to a wide variety of local organisations was noted;
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contribution to teaching and professional training in Scotland (providing student and probationary year teaching places) was also an activity in furtherance of education;
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selection on the basis of academic aptitude and ability was found to be justifiable (a similar decision having been taken in relation to the University of Dundee, the pilot in the university sector). Thus, this was not an unduly restrictive condition;
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the possibility that fees might be an unduly restrictive condition was considered. OSCR recognised the cost of provision of the benefit for which a charge was made as relevant in assessing the degree of restriction imposed by any fee designed to contribute to those costs. In other words, the cost of providing the benefit is something that can properly be taken into account;
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OSCR looked in great detail at the bursary support provided by High School of Dundee and, importantly, its transparency and publicity. OSCR was looking for effective provision to be made for those from a wide range of financial backgrounds, including on the lowest incomes, to have access to the benefits provided;
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it is quite clear that OSCR will look at both the breadth and depth of bursary provision in considering the effectiveness of facilitated access;
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OSCR also noted the local impact of access to the school’s sporting facilities for community-based sports groups and youth programmes; and the national impact of the curricular and subject development work, and contribution to teachers’ professional development;
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OSCR has emphasised that there are no definitive benchmarks: each review will be on an individual basis; and
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the pilot has given useful material to work with.
OSCR then went on to announce what it describes as “Phase 1a” of the Rolling Review, within which a further 30 charities will be reviewed, among them, surprisingly, 11 independent schools. These include boarding and day schools and by the time OSCR has completed reviews of all of them, intended to be by May 2008, the position will be even clearer.
Internal review
Quite apart from the public benefit test, it is worthwhile for schools reviewing their constitutions to ensure that they reflect a current range of activities and, if change is required, the process should be started now rather than waiting for OSCR to call.
It will be interesting to see how the public benefit tests progress north and south of the border, thanks to the different statutory backgrounds.
Simon Mackintosh is a partner and head of the Charities Unit at Turcan Connell.
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