Public Benefit

All charities must now demonstrate the benefit to the public which flows from their purposes.

The Charities Act 2008 states that the purposes outlined in an organisation’s governing document must be of benefit to the public for an organisation to be charitable.  This is known as the public benefit requirement.

The Charity Commission for Northern Ireland states that “Benefit is about the benefit flowing from the charity’s purposes.  For a charity’s purposes to satisfy the benefit element of public benefit, that benefit must have three key features, it must:

• flow from the charity’s purposes
• be capable of being demonstrated and
• be beneficial, not harmful”

In relation to the public aspect of the charity’s purposes, the Commission states “Public: This is about who may benefit from the charity’s purposes.  For a charity’s purposes to satisfy the public element, the benefit which may flow from those purposes must:

• be to the public or to a section of the public and
• not provide a private benefit to individuals unless this benefit is incidental”

The Commission has found that poorly defined public benefit statements often delay the registration process.  Through the publication of a thematic report – ‘Lessons from the Public Benefit Requirement’ – the Commission hopes to provide further guidance on the public benefit requirement through real examples.  The report supplements the Commission’s statutory guidance on the public benefit requirement. Charity trustees must have regard to this guidance.

The Commission has also developed a ‘Purposes and Public Benefit’ toolkit. This toolkit will help you review your purposes to ensure they adequately express what your organisation is set up to achieve.

Charities need to report on the public benefit they produce as part of their annual reporting to the Charity Commission.