Charities update: changes to rules on ex gratia payments delayed

Published 21 octubre 2022

In our recent article for charities setting out the latest on changes to be introduced by the Charities Act 2022, we touched on ‘ex gratia’ payments by charities - i.e. payments made by charities for moral rather than contractual reasons.  New rules relating to ex gratia payments, found in sections 15 and 16 of the Charities Act 2022, would have permitted charities to make small ex gratia payments without obtaining consent from the Charity Commission and were originally expected to come into force this autumn.

However, the Department for Digital, Culture, Media and Sport (DCMS) has delayed bringing these new ex gratia payment rules into force and the DCMS implementation plan now states the provisions are ‘under further consideration prior to commencement’.

Although no reason for the delay is given in the implementation plan, Civil Society Minister Lord Kamall discussed the matter in the House of Lords on 13 October. It has been brought to the attention of the government that the two sections ‘have the effect of enabling national museums for the first time to restitute items from their collections, based on moral grounds’, and that ‘no such intent was considered, nor agreed on’ when the bill was debated in the House of Commons and the House of Lords.

DCMS will be deferring the commencement of sections 15 and 16 until they are able to ‘fully understand the legal implications’ of the new rules. Implementation of other sections of the Charities Act 2022 will continue as planned this autumn.