Public Benefit

From 1 April 2008 the Charity Commission are now requiring all charities to prove that they are for Public Benefit.  It is not now enough to presume that charities are for Public Benefit. 

Public Benefit is the legal requirement that every organisation set up for one or more charitable aims must be able to demonstrate that its aims are for the Public Benefit if it is to be recognised and registered, as a charity in England and Wales.  This is known as the ‘Public Benefit Requirement.’

There are two key principles both of which must be met in order to show that an organisation’s aims are for the Public Benefit. 

Principle 1: There must be an identifiable benefit or benefits.
1a. It must be clear what the benefits are.  (It must be clear what benefits to the public arise from carrying out a charity’s aims.)
1b. The benefits must be related to the aims.  (All charities must act within their charitable aims and thereby prove that they are for the Public Benefit.)
1c. Benefits must be balanced against any detriment or harm.  (‘Benefit’ means the overall or net benefit to the public; it is not simply a question of showing that some benefit may result.)
Principle 2: Benefit must be to the public or a section of the public.
2a. The beneficiaries must be appropriate to the aims.  (‘The public or a section of the public’ for any organisation is based on those whom the organisation’s aims are primarily intended to benefit.)
2b. Where benefit is to a section of the public, the opportunity to benefit must not be unreasonably restricted:
  • by geographical or other restrictions or
  • by ability to pay any fees charged.
2c. People in poverty must not be excluded from the opportunity to benefit.  (Whatever restrictions there are on who can benefit, charities must in all cases ensure that people in poverty are not excluded from the opportunity to benefit from each of their aims.)
2d. Any private benefits must be incidental.  (‘Private benefits’ are benefits that people or organisations may receive other than as a beneficiary.)