The Politics of Charity

Kerry O'Halloran

• Publisher: Taylor & Francis
• Year: 2011
• Print ISBN: 9780415452991
• eBook ISBN: 9781136740398
• Edition: 1
• Topic: Política y relaciones internacionales
• Subtopic: Política

For the first time since 1601, a number of leading common law nations have almost simultaneously chosen to revise and place on the statute books the law relating to charity. The Politics of Charity examines the reasons for this and for the varying legislative outcomes.

This book examines the legal framework and political significance of charity, as developed within England & Wales, contrasts this with the experiences of other common law nations and explores the resulting implications for government/sector relationships in those countries. It suggests that charity law lies at the heart of the relationship between government and the non profit sector, that there is an unmistakeable political agenda driving charity law reform and that the differential in legislative outcomes reflects important differences in the policies pursued by the governments concerned.

Looking at fundamentally different approaches of government towards the sector in the UK, Ireland, the US, New Zealand, Canada, Singapore and Australia, O'Halloran argues the results will have implications for the present workings of parliamentary democracy.

The Politics of Charity will be a valuable resource for academics, regulators and legal practitioners as well as advanced and postgraduate students in law, politics and public policy.

Part I

Charity, politics and the law

1 Charity

Concept, social construct and structures

Introduction

This chapter deals in the main with definitional matters, with an emphasis on those that have a particular bearing on themes to be addressed in this book. It begins by examining the role played by ‘altruism’ ¹ and assesses the nature and relevance of the gift relationship. ² It identifies certain key characteristics of charity as a social phenomenon and considers the balance between public and private interests. It examines the distinctive legal concept of ‘charity’ and distinguishes it from ‘philanthropy’, ‘benevolence’, etc. It considers the importance of the ‘public benefit test’ and other legal determinants of charitable purpose and it notes the characteristics differentiating charity from other forms of nonprofit activity. In so doing, it builds a picture of ‘charity’ as defined within a common law context and as culturally and politically determined.

Altruism and the gift relationship

Altruism is an unselfish concern for the welfare of others: a private act for public benefit. Usually represented by a gift of money, time or skill, altruism is the accepted hallmark of charity. In many different cultures and all major religions, the virtue of altruism has traditionally formed a cornerstone of values serving to instil compassion and distribute resources in a manner that generates a sense of collective responsibility and binds participants into more caring communities. In a common law context its origins are entwined with religious concerns to ensure salvation of the soul and the law governing pious uses and equitable trusts, as administered first by the ecclesiastical courts then by the Courts of Chancery.

As charity law adapted in keeping with the increasingly secular response to social need, so altruism came to shed its religious associations and be viewed more simply as both an informal personal act of generosity to strangers, and as a component of public benefit – the central legal principle of charity. ³ Essentially, altruism is a form of virtuous behaviour rather than a social construct. The route from altruism to the legal concept of ‘charity’, however, is one of social construct.

Public and private interests

‘Charity’ as it is known to the common law comprises a blend of public and private interests. Its roots lie deep in ecclesiastic teachings, perhaps primarily in the catechist instruction that only by doing good to another in this life could salvation of the giver’s soul be secured in the next. This was necessarily accompanied by very tangible benefits for the community. Religious leaders encouraged their members to give to the poor and to contribute to the charitable works of their churches. Giving to needy people in their communities, to the poor in other lands, to the victims of natural disasters and to their churches was a strongly felt obligation for many people. Secular leaders were also quick to promote such activity. Those bound by the same set of beliefs then became further bound by such acts of mutual assistance, by a sense of group solidarity and by the shared values that fostered and were reinforced by civic participation. From at least feudal times, the advantages for leaders in encouraging charity as a means of generating responsible behaviour, maintaining order and social infrastructure and promoting social cohesion have been clearly evident.

The balancing of public and private interests in this context has never been easy. Historically, the inculcated values of mutual care that successfully nurtured group solidarity have so often turned one group against another, fomenting divisions, brutality and the collapse of societies. In more recent times, charity has been castigated for being patronising, creating dependency, addressing effects rather than the causes of disadvantage, and for diluting the responsibilities of government. It is often viewed as catering more for the private interests and whims of donors than as a strategic means for dealing with matters in the public interest such as abolishing poverty. However, there can be no escaping the fact that while it starts from and is reducible to personal values, encapsulated in a gift relationship, charity also represents the public interest as is clearly apparent from the type of purposes long recognised in the common law as charitable. The consistency and longevity of such purposes, across generations and jurisdictions, testifies to the importance of charity as a social construct and its capacity to adapt to the particular culture in which it functions.

The gift relationship

This may be understood as a transaction involving the interests of donor, an organisation, recipient and the state in an amalgam of private and public law concerns, governed by public law. The moral and sociological intricacies generated by these parties have been explored by Titmus in what he has called ‘the gift relationship’. ⁴ 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 an instance of the former, 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 untainted by any ‘contract of custom; legal bond; functional determinism; situations of discriminatory power; nor by domination, constraint or compulsion’. On the other hand, he considers 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.

The gift relationship, as Titmus perceived it in the UK blood donation service, is considered to be important because it is something that can bond us as a society. ⁵

The donor

The rationale for conferring preferential status on an organisation, and exempting a gift or an organisation from certain tax and other financial impositions, rests on state recognition that a donor has chosen not to confer a private benefit upon a named recipient but to instead make an altruistic gift for the public good. The right to dispose of personal property freely, an important aspect of private law, has long been upheld as a key attribute of democracy, although it is also permissible in some other societies. When that right is exercised so as to redistribute private wealth voluntarily for public benefit, then that, together with the ancillary need to protect the value of the gift, makes the transaction a matter of public law to be regulated in the public interest.

Titmus considers 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, is altruism. A regard for the needs of others is the principle that motivates their action. Donors show a high sense of awareness of belonging to a community and of social responsibility. It follows that it is important for the state to provide the opportunity for individuals to express their commitment to the community in which they live; indeed, he develops this theme in his final chapter, ‘The Right to Give’. He argues that the submersion of such opportunities within a market economy inhibits the freedom to give or not to give, that material incentives destroy rather than complement 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, is to be valued both for its own sake and because it demonstrates altruism; it would thereby encourage others to become givers. The act of giving models ethical conduct and generates a sense of shared morality and civic responsibility in communities.

Titmus acknowledges that the altruistic motive of the giver can also be accompanied by a degree of self-interest. The fact of anonymity in the blood donation process removes the possibility of donors being motivated by the desire for social approval, though clearly this may be a factor in other forms of giving. It also constrains their choice of recipient. 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 is the driving factor for a particular giver in relation to the gift and to the recipient is not a significant issue for Titmus. They are compatible, conducive to promoting socially responsible behaviour and at risk of negation by blanket market forces. As is increasingly apparent from government policies intended to increase volunteering and incentivise donors, altruism is also susceptible to political influence.

The gift

The gift is twofold: from the donor and from the state. The first is uncontroversial: generally, any person of sound mind (subject to the rights of dependants) is free to give their property to whomsoever they choose; though legally prescribed inducements such as the GiftAid scheme, or constraints such as inheritance tax and death duties, demonstrate that this area of personal freedom is not outside political reach. Titmus drew attention to the potentially corrupting effect of this on altruism when he compared the UK and US approaches to blood donation: the financial incentives available in the latter jurisdiction served to detract, in his view, from the total public benefit value of the gift. The second, when a legally prescribed vehicle is used which allows the state to add considerably to the value of the gift by exempting it from tax, may be hedged about with conditions that can give rise to controversy (see further below). However, by addressing the need of an individual or community the gift relieves the government of the necessity and cost of doing so and to that extent represents a politically created opportunity for private resources to augment public service provision. The type of gift and the circumstances in which it may be given, if it is to come within a statutory definition of ‘charity’, are clearly politically determined.

The charitable organisation

An organisation, dedicated to the promotion of public benefit purposes, provides the formal conduit for channelling a donor’s gift to the recipient. Such an organisation, by virtue of its status as dedicated to public benefit activities and thereby supplementing or displacing the need for state service provision, will most usually be eligible for tax exemption and other benefits derived from preferential state recognition. Many have existed for centuries and in the process have accumulated vast assets, data banks of irreplaceable worth and close bonds of mutual understanding with those socially disadvantaged whose interests they were established to serve.

The infinite variety of nonprofits collectively represent the moral strength of a sector that makes a non-exploitive contribution to society. Within that range of organisations, 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 (see further below). 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, the market and the citizen. Their registration as such confirms the special status of charities as organisations 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 marketplace, unaccountable to shareholders or constituency while entrusted with funds from private donors and the public purse, the responsibility rests squarely with a charitable organisation to promote the interests and champion publicly the cause of those they represent. In theory the independence, resources and knowledge of a charitable organisation operating from within a centuries-old charitable sector of enormous wealth should enable it to effect change, but in practice, as will be seen in the following chapters, politi...

Table of contents

• Cover Page
• Half Title page
• Routledge research in comparative politics
• Title Page
• Copyright Page
• Dedication
• Contents
• Foreword
• Acknowledgements
• Introduction
• Part I Charity, politics and the law
• 1 Charity Concept, social construct and structures
• 2 Charity and law
• 3 Charity and politics
• 4 Parameters for charity
• Part II Government and charity Contrasting international models
• 5 International charity law reform
• 6 The partnership model
• 7 Transitional states
• 8 The open market model The US
• Part III Regulating charitable activity Jurisdictional differences and their political significance
• 9 Regulating for different outcomes
• Conclusion
• Notes
• Select bibliography
• Index