Charities and the Lobbying Act in the run-up to the general election

A charity may engage in campaigning activity as long it does so as a means of delivering its charitable objects – by campaigning for a change in the law that would support those objects, for example.

Normally, there is no limit on the extent to which a charity can engage in this kind of activity, provided that it is not the sole way in which it pursues its objects and that it does not stray into party political territory.

However, a general election is looming and, in the run-up to such an election, charity campaigning can (but will not necessarily) constitute "regulated activity" for the purposes of the Transparency of Lobbying, Non-Party Campaigning and Trade Union Administration Act (usually referred to simply as the Lobbying Act). Any organisation that spends more than £10,000 in any part of the UK on "regulated activities" must register with the Electoral Commission as a "non-party campaigner" or they risk a fine.

The fact that there is no exemption for charities has itself been the subject of campaigning activity, but this has so far had no effect: one charity has been fined £30,000 for failing to register when required (apparently, in an act of defiance), and at least one other for registering late (more on that in a moment).

What are regulated activities?

Campaigning activity will constitute regulated activity if it can reasonably be regarded as intended to influence people's voting choices. This is known as the "purpose test". The Electoral Commission takes the view that, while a lot of charity campaigning activity will not meet the purpose test (because charities must remain independent of party politics), it is possible for a charity to comply with the requirements of charity law and still undertake regulated activity – if, for example, it undertakes a campaign that appears to encourage people to vote in favour of candidates who have openly opposed a particular policy, say, rather than supported it.

Activity that can meet the purpose test includes press conferences and other media events, and the transport of people for the purpose of publicising a campaign. Some activities are only regulated if, in addition to meeting the purpose test, they are aimed at, seen or heard by, or otherwise involve the public (the "public test"). Included in this category are the production or publication of campaign material, market research and otherwise canvassing the views of the general public, and public rallies and similar events.

A charity's members and supporters (including regular donors, individuals who pay an annual subscription and people who are actively involved in the organisation) are not considered part of the public, and so activities aimed exclusively at such people will not generally constitute regulated activity.

However, a rally or event to which only members or supporters have been invited will meet the public test – and therefore be regulated activity – if it can be witnessed by members of the public. It should also be noted that people who have signed up to social media feeds and other people with whom a charity regularly communicates are classed as members of the public unless they are also members or supporters.

What is the regulated period?

One controversial aspect of the Lobbying Act is the retrospective manner in which its requirements become applicable. Any expenditure on regulated activity incurred by an organisation prior to an election during what is known as the "regulated period" counts towards its spending total. The difficulty with this is that, in the case of general elections, the regulated period is 12 months and – as we know – general elections are not generally called on 12 months' notice. In other words, charities will usually need to look at what they have already spent on campaigning activity, as well as what they are planning to spend when determining whether they are required to register as non-party campaigners.

In theory, it is possible for a charity to discover, once a general election has been announced, that it has already met the threshold. However, pre-announcement activity will only be regulated if, at the time it was carried out, it could reasonably be regarded as having been intended to influence the outcome of the election that has since been announced.

What action should we take?

If your charity carries out campaigning activity and you have not already done so, you should consider whether it will constitute regulated activity and, if it will, ensure that you know how much has been spent on it over the course of the past few months.

We do not yet know the date of the general election, but we do know that it will be this year and therefore that the regulated period will ultimately be deemed to have begun at some point last year. Once the election date has been announced, charities will need to determine quickly whether they are likely to exceed – or have already exceeded – the threshold for registration with the Electoral Commission. If they have, they should register online as soon as possible, although there is likely to be a grace period before the Commission begins issuing fines for non-compliance.

Any charity that is in doubt as to whether it will exceed the threshold (or that is unclear whether its campaigning activity is of the regulated variety), may wish to err on the side of caution and register anyway. Having registered, a charity may then be required to report on its actual spending, although the frequency of and the level of detail required in reports vary according to the likely total.

Further information about the requirements can be found in the Commission's new Non-party Campaigner Code of Practice.