Wheels within wheels: the pattern of State regulation of charities as a subset of the Third Sector in Ireland following the commencement of new legislation regulating charities in 2014.

• In Event: Civil society regulations

Abstract

This paper describes how the profile of the Third Sector in Ireland was refined in 2014 by new legislation defining charities and creating a regulatory authority to enforce the provisions of the Charities Act 2009. Since then, a proportion of all Irish nonprofit organisations (NPOs) are registered as charities, but a large and more or less consistent proportion are not. By reference to datasets derived from multiple public sources and created by Benefacts 2015-2022, a definition of the Third Sector that relies on the foundational work of Salamon and Anheier and others, and sub-sectoral taxonomies also developed by the Center for Civil Society Studies, the paper describes the emergent character of the register of charities in Ireland as a subset of the Third Sector as a whole.

The role of the Charities Regulatory Authority is to regulate the charity sector in the public interest so as to ensure compliance with the law and support best practice in the governance, management and administration of charities. The Authority began life in 2014 with a ready-made initial register of charities comprising those NPOs that had previously secured favorable recognition as charities under taxation legislation – a kind of proxy regulation. In 2016 the Regulator’s first annual report indicated there were 8,003 charities on this baseline register. Six years later the Regulator’s most recent (2022) report indicates that this number has increased to 11,506, but most of the growth is accounted for by some 4,000 primary and secondary schools brought onto the register.

The number of preexisting or newly established NPOs that have sought and secured charity status in the same period is numbered in the hundreds, whereas thousands more Irish NPOs in the Benefacts database 2015 – 2022 are not registered as charities even though they are constituted for public benefit (according to the objects clause in their constitutions) and have purposes that appear to fall into the definition of charity as described in law.

It is beyond the scope of the paper to posit the eventual likely profile of the charities register since there is no way of knowing which NPOs are in the queue for registration, or which may have sought it and been declined. Moreover, any NPO holding itself out to be a charity but not on the register is in breach of the law. The paper will describe the emergent character of the charity register as a whole relative to the wider Third Sector population in Ireland in terms of the sub-sectoral profile of both sub-sets (registered charities and “non-charities”), their institutional forms, and the correlation between charity registration and funding profile – specifically public fund-raising and State funding as sources of revenue. Since the Charities Regulator can only regulate NPOs that are on its register, the question of the penetration and profile of charity registration is of interest to the sector itself, to its analysts and funders and to policy-makers who have no means of tracking these questions now that the extended Benefacts database has been closed down.

References

Annual reports of the Charities Regulatory Authority 2016 – 2022 inclusive https://www.charitiesregulator.ie/en/who-we-are/reports-and-publications accessed on 26 October 2023

Benefacts legacy datasets accessed here https://benefactslegacy.ie/data/ on 26 October 2023

Bloodgood E.A., Bourns J., Lenczner M., Shibaike T., Tabet J., Melvin A., Wong W., Wendy H. Wong (2023) Understanding National Nonprofit Data Environments Nonprofit and Voluntary Sector Quarterly accessed here https://journals.sagepub.com/doi/10.1177/08997640221085731 on 26 October 2023.

Breen O., Dunn A., Sidel M., Editors (2016) Regulatory Waves: Comparative Perspectives on State Regulation and Self-Regulation Policies in the Nonprofit Sector. Cambridge University Press.

Irish Statute Book Charities Act 2009
https://www.irishstatutebook.ie/eli/2009/act/6/section/3/enacted/en/html#sec3 accessed on 26 October 2023

Report of the independent Review of Charity Regulation Northern Ireland https://www.communities-ni.gov.uk/publications/independent-review-charity-regulation accessed on 26 October 2023

Salamon L. M., Anheier H. K. (1997). Defining the nonprofit sector. Manchester University Press.

United Nations (2018) UN Handbook on Nonprofit Institutions in the System of National Accounts

Author

• Patricia Quinn, Benefacts Legacy DAC