The Scottish Government opened up a consultation on 'the Future of Land Reform in Scotland' on 2nd December 2014. According to the consultation hub, the proposed provisions are designed (amongst other things) to 'demonstrate commitment to effectively manage land and rights in land for the common good'. They seek to do this (again, amongst other things) by 'placing a duty of community engagement on charitable trustees, when making decisions on land under the trustees control'.
Proposal 6 under Section D of the consultation paper discusses the duty of community engagement. The proposal 'considers the relationship between charitable organisations that own land and the local communities which may be affected by decisions taken on the use, management or transfer of that land' (emphasis added).
The consultation states that the Charities and Trustee Investment (Scotland) Act 2005 recognises that other legislation may impose duties on charity trustees and the obligation to act in accordance with the purposes of the charity is without prejudice to any other legislative duties.
The standalone duty proposed in the Land Reform consultation would oblige charity trustees to engage with, and consider the potential impact on, the local community before taking any decision in relation to the management, use or transfer of any land under the charity's control. The consultation paper acknowledges that this duty will need to be balanced with the exercise of charity trustees' other functions and their duty to act in the interests of the charity/to ensure the charity acts within its charitable purposes.
Responses to the following questions are sought:
Q. 20. Do you think a trustee of a charity should be required to engage with the local community before taking a decision on the management, use or transfer of land under the charity's control?
Q. 21. What do you think the advantages or disadvantages would be?
Q. 22. How should"community" be defined?
Q. 23. What remedies should be available should a trustee of a charity fail to engage appropriately with the local community?
Initial questions which arise for charity trustees include:
- Would OSCR regulate compliance of the proposed community engagement duty? What evidence is required to show engagement? What would constitute a breach and what would be appropriate penalties; would the balancing exercise be regulated from an objective or subjective perspective?
- Charity trustees are already under a continuous duty to ensure their charity's purposes are carried out for public benefit: would a lighter-touch duty be more appropriate such as an obligation to consider the effect on community and have regard to potential consequences?
As with all consultations on Law Reform, this is an opportunity to consider the need for reform, debate the appropriate outcome and discuss the opportunities and challenges the proposals may bring.
At this stage, we can only broadly consider the wording of the proposal itself – whether trustees of charities which own land should be obliged to engage with the local community which may be affected by decisions taken by them on the use, management or transfer of that land.
Depending on the scope or extent of the duty, the proposals may create some challenges for charities which own land. The extra duty may cause additional work, increased costs and delays in the process. However, local community engagement may be of benefit to the charity: it may have the effect of increased support and activity for the charity and local publicity, and might engender closer working relationships with members of the community. Charities which may be affected by the proposals should consider lodging a response with the Scottish Government to make their views known.
The consultation is open until 10th February 2015.