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AG backs private schools' legal challenge to compulsory bursary rules

4 October 2010

The Attorney General is pushing through a Charity Tribunal hearing to decide whether forcing private schools to offer bursaries is illegal.

Documents have been handed to the Upper Tribunal (Tax and Chancery Chamber) demanding a full decision be made on whether the Charity Commission has the power to enforce quotas for scholarships.

In his letter to the court, Attorney General Dominic Grieve QC states: “The reason for the reference is that there is uncertainty as to the operation of charity law in the context of fee charging independent schools.

“That uncertainty is contrary to the interest of charity because it means that the charities concerned do not know whether or not they are operating within or without the terms of their constitutions.”

Grieve’s move follows an ongoing judicial review application from the Independent Schools Council (ISC) which represents more than 1,000 private schools, most of which have charitable status.

The ISC claims the Charity Commission’s guidance on its ‘public benefit’ test, published in January 2008, is contrary to existing case law.

A spokeswoman for the Charity Commission said the reference was “welcome” as it was the most appropriate way to clarify the law, adding: “In preparing all our guidance on public benefit, the commission was at all times diligent in consulting charities and others affected, and in making clear the process we had followed.

“We set out our legal reasoning clearly and carefully alongside our guidance. We stand by our approach and the legal analysis which underpins it, and we are confident that the commission has acted reasonably and followed due process.”

Acting in his official capacity as ‘protector of charity’, Grieve has referred the case to the High Court as intervener in the ISC’s case, stating: “While the judicial review proceedings may determine whether the guidance provides an accurate statement of charity law as it relates to the public benefit requirement…whether the public benefit requirement is satisfied or a charity is acting in accordance with its constitution generally is case specific and the judicial review proceedings may not lead to a resolution of those issues.”

The Attorney General has requested the president of the General Regulatory Chamber considers the issue, posing three fictional scenarios, regarding ‘Nowhere School Company Limited’, for which he wants solutions.

“The reason for the request is that the reference raises complex issues of general public importance, which are likely to require a significant amount of judicial time. It is desirable that the reference be determined by a superior court of record,” said Grieve.

ISC chief executive David Lyscom said he was “delighted” with the chief solicitor’s move, stating: “This supports our position that there are complex issues of law around public benefit and that interpretation of the law by the Charity Commission, including its guidance, needs to be examined in the courts.

“We have been saying all along that there are serious misgivings among charity lawyers, as well as charities themselves, about the commission’s approach.

“The entire sector continues to be at the whim of the commission’s prevailing and subjective view as to what public benefit means, and what is ‘sufficient’ for a school to pass the public benefit test.”

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