Charity Law and Social Inclusion

An International Study

Kerry O'Halloran

• Publisher: Routledge
• Year: 2007
• eBook ISBN: 9781134277650
• Edition: 1
• Topic: Medicine
• Subtopic: Health Care Delivery

Profiling national and international social inclusion agendas, Charity Law and Social Inclusion examines the fit between the charity law framework and the needs of the socially marginalized in some leading common law nations: the US, England and Wales, Ireland, Australia, New Zealand and Canada.

It:

• examines the concepts of philanthropy, inclusion, alienation and justice
• considers the competing claims of philanthropy, legal rights and politics as appropriate methods of pursuing social justice
• explains how weaknesses in charity law obstructs philanthropic intervention
• makes recommendations for changes to the legal framework governing philanthropy.

O'Halloran argues that our common charity law heritage must be updated and co-ordinated to be capable of addressing social inclusion in the twenty-first century.

This book is of interest to academics and students working and sudying in the areas of social policy, sociology and law, as well as professionals in community and voluntary work.

Part I
Philanthropy, social inclusion and the law

Chapter 1
The gift relationship

Charity and the law

Introduction

This chapter suggests that ‘the gift relationship’¹ provides an appropriate leitmotif and convenient starting point for a book on charity and social inclusion. It uses the dynamics of that relationship to introduce and explain the key parties, concepts and principles underpinning the themes that interplay throughout the book. It then considers the central axis around which the themes turn: charity and charity law.

The concept and practice of charity, in a common law context, would seem to have been formed in pre-Reformation England at a time when Church and King were the twin institutions governing society. For both, charity served to some extent as the default position for hierarchical authorative powers that prescribed the rights and duties of all loyal subjects within the realm. Those too poor, infirm or otherwise incapacitated to play a useful role in a heavily structured society would be cared for and maintained, and kept in their place, by services paid for by parish tithes imposed and administered by worthy men of both institutions. This system provided for the inbuilt reciprocity of two sets of needs: those who wished to be fed in this life and those who by feeding them hoped to save their souls in the next, the dutiful role conformity of both contributing to maintaining the compliant status quo necessary for continuing the established authority of lord and bishop. The gift relationship then worked as a necessary solvent for an otherwise rather inflexible society.

The law, when it eventually arrived, provided a framework that fitted around these relationships and was designed primarily to prevent abuses of charitable funds and taxes while pragmatically allowing the concept of charity to extend to more general public service provision including such items of social infrastructure as bridges for the use of rich and poor alike. As the saintly were displaced by the secular so charity became more aligned with the agenda of government, though never quite losing its deference to religious institutions. Whether supplementing or substituting for government provision, charity continued to deal mainly with the effects of poverty; persons of means had little need to concern themselves with issues regarding ownership of schools, hospitals and other public utilities. Gradually, the stream of charity was judicially broadened to engulf more esoteric aspects of social provision, such as concert halls and art galleries, that previous generations might have been puzzled to find alongside the usual traditional rudimentary public benefit charitable institutions, particularly when poverty and its effects were still very much in evidence. The emphasis in the gift relationship had shifted from the alleviation of poverty to filling in the gaps in an ever more sophisticated society. Its social function, however, was arguably much the same: to work alongside the powers that be to provide such palliative services as were required to improve social infrastructure, ease points of stress and facilitate social cohesion.

The impact of globalization has further stretched the gift relationship and poses a more fundamental challenge for the modern role of charity. If it is to continue its role attending to gaps in the social fabric then it will have to deal with the fact that both power and the threat of disruption now often lie outside the society in question: it is no longer possible for modern western societies to look only internally and address the effects of social stress. Governments and charities will need to clarify their respective roles and address social inclusion, the root cause of the greatest threat to the future stability of such societies, on a domestic and international basis.

This chapter explores the evolution of charity and the law and explores the roles of the principal parties involved to consider the question, What is charity for?

The gift relationship

Charity involves donors, recipients, charitable organisations and the State in a complex set of transactions governed by common law and legislation; other interests such as business, politics and international Conventions are also represented and call for examination at a later stage. The legal intricacies thus generated are explored throughout the book but it may be helpful to begin by examining the roles played by the main players.

Giving and the ‘gift relationship’

At the heart of charity lies what has been termed the ‘gift relationship’. It was Titmus who, in his seminal and much quoted work under that title,² first brought sociological expertise to bear on the nature of the relationship between donor and recipient in the context of philanthropic exchange. He examined the act of ‘giving’, seeing it as the voluntary and altruistic act of an individual, and compared it with a commercial system in a study which focused on blood donors. The contrast, as he saw it, was between ethically based behaviour and behaviour motivated by self-interest. In the former instance, the National Blood Transfusion Service in the UK provided a service to which blood donors made anonymous contributions without financial or other reward and from which recipients took according to need incurring no cost and without knowing the identity of the donor. In Titmus’s view, this free gift of blood left the relationship between giver and recipient uncompromised by any ‘contract of custom; legal bond; functional determinism; situations of discriminatory power; nor by domination, constraint or compulsion’. On the other hand, he considered that the alternative approach to the same service in the US reduced people’s willingness to donate blood because the transaction had become tarnished by commercialism causing such adverse consequences as the repression of expressions of altruism and an erosion of a sense of community.

Since then much academic attention has been drawn to philanthropy in general.³ As has been said: ‘The very voluntariness and optionality of private philanthropy gives it an important moral status . . . a society without private philanthropy would be a morally impoverished society.’⁴ The gift relationship, it has been argued, is something that can bond us as a society

The giver

Titmus considered that the reason why people donated blood without direct reward, at a cost of their own time and effort, to another with whom they have no direct contact, was altruism. A regard for the needs of others was the principle that motivated their action. Donors showed a high sense of awareness of belonging to a community and of social responsibility. It followed that it was important for the State to provide the opportunity for individuals to express their commitment to the community in which they lived; indeed, he developed this theme in his final chapter ‘The Right to Give’. He argued that the submersion of such opportunities within a market economy inhibited the freedom to give or not to give, that material incentives destroyed rather than complemented moral incentives. The freedom of choice, enabling an individual to select the class of persons or type of cause to benefit from his or her gift, and to do so on a basis that may discriminate on grounds of country, religion, gender, locality, etc., was to be valued in a democracy for its own sake and because it demonstrated altruism it would encourage others to become givers. The act of giving modelled ethical conduct and generated a sense of shared morality and civic responsibility in communities.

Titmus acknowledged that the altruistic motive of the giver could also be accompanied by a degree of self-interest. The fact of anonymity in the blood donation process removed the possibility of donors being motivated by the desire for social approval; though clearly this could be a factor in other forms of giving. The concern to help another, however, may, to a varying extent, be attributable to a desire to see that person lead an independent and useful life and relieve the giver of further concern for their welfare. Whether utility or unalloyed altruism was the driving factor for a particular giver in relation to the equally particular gift and recipient was not a significant issue for Titmus. They were compatible, conducive to promoting socially responsible behaviour and at risk of negation by blanket market forces.

The gift

The gift is twofold: from the donor and from the State. The first is uncontroversial: in a democracy, any person of sound mind (subject to the rights of dependants) is free to give their property to whomsoever they choose; this can, but need not be, by way of charity. The second, when the charity vehicle is used and the State adds considerably to the value of the gift by exempting it from tax, is hedged about with conditions that can give rise to controversy (see p. 96). The gift, intended to meet a need, also provides a measure and social confirmation of inadequacy while its nature and the manner of giving are clearly matters that ultimately affect its utility.

The recipient

In a common law context, the categories of those from whom requests may legitimately be received have long since been embedded in charity law. Pemsel,⁵ together with such new categories as can fit within the ‘spirit and intendment’ rule⁶ has served to identify charitable purposes, the bodies upon which charitable status is to be conferred and ultimately those entitled to charitable resources (see p. 82).

The position of the recipient in the gift relationship is complicated and clearly not confined to responding with expressions of gratitude and satisfaction in respect of needs that to some degree have been met. The gift is always an acknowledgement of the recipient’s functional deficit; to receive is to accept not just the benevolence of others but that your failure to provide for yourself has acquired a level of social exposure. The fact that the recipient recognizes and is comforted by the inherent virtue of the giver, who may well have given anonymously, and values and uses the gift as intended, does not necessarily mean that they thereby become better equipped to cope. For the recipient, the psychological dynamics of the gift relationship can all too often serve to confirm their inadequacy and enduce long-term compliant dependency.

The charitable organization

The infinite variety of not-for-profit organizations together represent the collective moral strength of a sector that makes a non-exploitive contribution to society. Within that range of organizations, charities are distinctive because they cleave to the public benefit principle as their raison d’être and have the capacity to channel the value of donors’ gifts to their intended purposes across many generations. The trust and specialist knowledge that charities build up in the process of mediating between giver and recipient places them in a crucially important strategic position between State and citizen, as broker on behalf of the socially disadvantaged, and vests them with the responsibility to work with both to further social inclusion. Their registration as such confirms the special status of charities as organizations dedicated to furthering the public benefit of the disadvantaged and in the eyes of society confers upon them a stamp of virtue.

Free from the exigencies of government, and to some extent also from the competitive pressures of the commercial market place, unaccountable to shareholders or constituency, while entrusted with funds from private donors and the public purse, the responsibility rests squarely with a charitable organization to promote the interests and publicly champion the cause of those they represent. In theory the independence, resources and knowledge of a charitable organization operating from within a centuries-old charitable sector of enormous wealth should enable it to effect change in the social inclusion agenda.

The State

For the State, to endorse the gift relationship is to inculcate a value system that encourages altruism, reinforces a sense of obligation, stimulates social capital, provides a basis for community bonding and builds a more ethical society. The State can only gain from a sector that: generates a vibrant and diverse participative form of democracy; attracts the involvement of an army of volunteers; bolsters civic responsibility and thereby fosters the growth of social capital and consolidates civil society. In addition to being a catalyst for a more civil and morally based society, the encouragement of altruistic conduct also has the happy consequence of reducing State expenditure.

However, some of the criticism leveled by Titmus against the influence of commerce on altruism applies equally to that of the welfare state. They both inhibit individual acts of altruism, in the latter case because of the collective view that taxes are paid and systems exist to address the needs of the socially disadvantaged. The value of the individual gift is devalued by the collective provision of the welfare state. This in turn may well have a correspondingly negative effect on moral values as a binding social influence.

Charity

Theoretically, charity is concerned with the fact and effects of poverty and is focused on methods for directly alleviating the suffering of others. This should serve to distinguish charity from philanthropy which is primarily about respect for the civilizing effects of human endeavour and is focused on providing and promoting opportunities for bettering the human condition.⁷ It should also differenti-ate charity from public utility provision which deals with the more institutional aspects of social infrastructure that provides generally for the security and well-being of the population. Again, it should be clearly different from the activities of religious organizations in which member benefit is essentially pursued as an aspect of worship. The difference is one represented, respectively, by soup kitchens, the Royal Opera House, hospitals and the saying of mass.

‘Charity’, however, has managed to accommodate all the above. For four centuries it evaded the constraints of legislative and judicial definition and remained a creature of the common law. In the process, the meaning it acquired in law diverged considerably from any social meaning that would otherwise have logically been ascribed to it. The distortions inflicted upon it by successive generations of the judiciary have left the concept of ‘charity’ inadequate and ill-fitted to the role of lynchpin in a modern legal framework for philanthropy.

Charity in its traditional Christian context

Charity, as it is known to the common law, has its roots in the supplicant/ benefactor relationship set within a Christian social context. The relationship was initiated by a humble plea for assistance, and elicited a dutiful response in which the benefactor gave as little as was judged sufficient to...

Table of contents

• Cover Page
• Title Page
• Copyright Page
• Acknowledgements
• Introduction
• Part I Philanthropy, social inclusion and the law
• Part II Charity
• Part III Legal rights and functions
• Part IV Contemporary law and practice
• Conclusion
• Notes