Perhaps the Parliamentary Secretary will reconcile Section 23?
Charities Bill, 1957—Second Stage (Resumed).
Question again proposed: "That the Bill be now read a Second Time".
Of course. This Bill represents an important measure of law reform. It is technical and, to some extent, intricate. I think that the wish of the majority of Deputies in those circumstances will be to get the best possible measure. Indeed, I know that it is the earnest desire of the various institutions and establishments whose interests will be directly affected by this Bill that we should get the best possible measure. Therefore, to say the least of it, it is undesirable for the Leader of the Opposition to debate the Bill in the manner in which he has and to attempt to procure some slight political Party advantage in his approach.
In my opening speech, I was very careful to outline fully the whole history of this measure. I traced it from its origins and I did not in any way attempt to take any credit for anything in the Bill or to say what I had done or had not done. Even now, under the provocation which the Leader of the Opposition has offered me personally, I do not intend to attempt to take credit for what has been done because I am fully conscious—as, indeed, I am sure, every Deputy is conscious—that a very great deal of credit for a technical measure of this nature should go to those who are not in a position themselves to take that credit—those who work quietly and unobtrusively behind the scenes and who bring their very great skill, experience and technical knowledge to bear on producing this type of Bill.
For the record, however, I shall say that the preliminary steps in regard to this Bill were taken by a Fianna Fáil Government. The work in relation to it was continued by the Coalition Government which followed and now we hope that the Bill will be brought to fruition by the present Government. These are the simple facts of the situation and I readily admit them. I am prepared to give whatever credit is due anywhere it belongs and, as I say, I do not want to attempt to procure any Party political advantage in any way. I think it is wrong for anybody else to attempt to do so either. As this is a technical and difficult Bill, we should concern ourselves with arriving at the best possible result.
Deputy McGilligan criticised me along these lines. He said the Parliamentary Secretary failed to get a definition and came along here instead with a rather weak substitute in the form of advice to testators and draftsmen. I do not consider that criticism fair. The advice I gave in my opening statement is perfectly sound advice, well worth giving. I suggest that anybody introducing a Bill of this nature, no matter what the state of the existing law was or is likely to become, might legitimately give that advice. No definition that could be evolved or procured would cure bad drafting. No matter what we do in this Bill, it still behoves the draftsmen and practitioners to be careful to ensure that the wishes of testators and donors are given effect to in proper language that will not lead to a dispute as to interpretation.
On the question of a definition, I should like to quote from the Newark Committee which, as I have already mentioned, reported in the Six Counties recently. They say:
In any event, previous experience in other branches of the law tends to suggest that a statutory definition would become merely a starting point for a fresh body of case law to develop.
I think that is very true and very well put. It is a statement of which we should take serious note. Further, on this point of definition, I think we should keep in mind that many of our charities have trans-Border implications. From that point of view and for other reasons, it is most desirable that the law in both parts of this country should correspond. If we had a statutory definition of what was charitable that was not followed in the Six Counties a difficult situation could arise. I am glad to say that the thinking in Belfast so far as I am aware of it, is the same as ours in this matter.
I was very impressed by what Deputy Sheldon had to say on the question of a definition. He very rightly pointed out that the concept of charity is a changing one. Today we have a new factor in the situation, namely, the welfare State. The position with us falls short of what might be described as a welfare State, but at least we have a considerable growth in social services. This must affect the concept of charity. Moreover, social conditions are changing all the time and it would be well to pause before committing oneself irrevocably to a watertight statutory definition of what is and what is not charitable. I reiterate that they have in England grappled with the definition problem, but decided not to proceed with one, so that I feel sure the House will agree that criticism of this Bill, based on the fact that it does not contain a definition of charity, is not a very good criticism.
I cannot see any force either in the argument that we propose to allow the Charity Commissioners to vary or alter cy-près schemes which have been framed by the courts. I do not think it is relevant in that context to consider who devised the original scheme. The point is that the scheme has failed. A scheme framed by the courts is just as likely to fail with the effluxion of time and to become impracticable or illegal as one framed by somebody else. There is no question of the Charity Commissioners overruling the courts. It is simply a question of a situation arising where the cy-près doctrine must be applied again because the court scheme has failed. The proposal is that, if the court scheme fails, the Commissioners may prepare another scheme. I think it was Deputy Dillon who asked why we are doing this. The overriding consideration is the question of expense. The whole idea behind giving cy-près powers to the Charity Commissioners and, indeed, increasing those powers, is to enable charities to be spared the expense of going to court to have schemes drafted and settled.
Somebody quite rightly remarked during the course of the debate that the discussion we had on Section 13 was more appropriate to Committee Stage than Second Stage, but I should just like to deal briefly with the arguments put forward. As was indicated, this is a thing which has its roots in history. Originally, the statutory provisions were that certain judges were ex officio Charity Commissioners. Deputy Dillon, with a characteristic wave of his hands, and invoking the simple people of Ireland to whom he frequently has recourse, asked could we not get these people freely, without having High Court judges. That is an over-simplification of the position; indeed, it is a misrepresentation. Men of the kind who serve as Charity Commissioners are very scarce. Ideally, they are men of skill, knowledge, a great deal of experience and they are people of integrity. Men of the requisite calibre are scarce. It is wrong for the Leader of the Opposition to suggest that there are so many of that type of person around that there is no need to put on the Board a person who might subsequently become a judge.
What I suggested was that, if he became a judge, he might properly withdraw from the Board.
I think the Deputy went on to say that if a person withdraws or resigns from the Board, on being appointed a judge, he could easily be replaced. I want to refute that. I think it is not true. People of the necessary qualifications are scarce and, unless there were some overwhelming and compelling reason why a judge should withdraw from the Board, I think it would be undesirable that he should do so. Section 13 merely states that a judge shall not be prevented from hearing a case affecting a charity simply because he is a member of the Charity Commissioners. It goes no further than that. The normal etiquette which prevails amongst the judiciary still applies. Any judge, when a case comes before him, will properly ask himself whether or not there is any factor that would prevent him, in accordance with the traditions and practice of the judiciary, hearing it. Apart from Section 13, every judge will do that, and all that we are saying is that just because he is a Charity Commissioner, he will not, because of that fact alone, be debarred from hearing a case which has a charity content. I cannot see any danger in that situation and am absolutely happy with regard to it. I have complete confidence in the normal principles and traditions on which the judiciary operate in these matters. These principles and traditions will take care of any fears which Deputy Dillon may entertain.
Deputy McGilligan referred to the section concerning audits, especially to the provision in regard to perjury. I realise that we have no modern Perjury Act in this country and I feel sure the House generally will agree that this is a very great lack. Matters of perjury fall to be determined mostly under the common law. I shall be glad to have another look at the provision, referred to by the Deputy, to see whether it is in need of revision. It is a little significant, however, that Deputy McGilligan, in a different capacity, approved of the text of the Bill which contains this very provision. However, I suppose he is perfectly entitled to come along at a later stage and take a different view.
He also raised the question of the publication of notices of charitable bequests. I have received recommendations from the Charity Commissioners in this matter and I am considering them at the moment. I am aware that the Newark Committee's view is that publication should not be necessary, unless the Commissioners direct it; in other words, that the situation be the reverse of what it is at the moment. The position now is that publication is obligatory, unless the Commissioners exempt from publication.
A question which engaged the attention of most of the Deputies who spoke was that of investment, and here I have some pleasure in agreeing with a lot of what Deputy Dillon said, and also with what Deputy Sheldon said. Deputy Dillon pointed out quite rightly that the fiscal history of the past 50 years or so is one of decrease in the value of trustee investments. I believe the principle that should obtain in the matter of investing trust funds should be the avoidance of speculation. It is desirable that, in order to avoid speculation, there should be the maximum amount of flexibility available to trustees. The safest way of avoiding excessive fluctuations is to have a satisfactory spread of investment. The management of an investment portfolio in modern times, if the best results are to be achieved, involves a very considerable degree of flexibility and a considerable freedom of choice.
It is against that background that the policy of the present Government, as enshrined in the 1958 Act, has been brought into being. It is important to realise that, up to now, the court, in charity matters, had complete freedom to do more or less as it wished. Funds could be invested inside or outside the State, and in any security. The Bill makes a change in line with Government policy, and investments of charity funds must be kept within the State. Section 32 is designed to enable the Charity Commissioners to invest and authorise the investment of trustee funds in a wide range of securities, including ordinary shares. There is no obligation on them to invest in all the securities now being authorised, but it is desirable that they should have a wide range to choose from.
It will be recognised that an ideal way of investing funds today is to put a certain proportion into fixed securities, a certain proportion into less fixed securities and finally to put the remaining proportion into equities which do not have the same degree of absolute security as gilt-edged securities but which give an opportunity of capital appreciation and of substantial return in the form of income. All we propose in Section 32 is to allow that sort of flexibility for investments of charity funds. We can be sure that the charity commissioners and charity trustees will have available to them first-class professional advice with regard to investments. Nobody today need go out and invest funds and hope for the best. As in most other things, there is readily available skilled professional advice in these matters; and I have not the slightest hesitation in saying that the charity commissioners will make full use of such advice. The fears expressed by Deputies with regard to our giving these extended powers of investment to the charity commissioners and charity trustees generally are groundless.
May I, in conclusion, mention one point touched upon by Deputy Booth? He asked that the Government should bear in mind in appointing Charity Commissioners in the future the desirability of having a mixed Board. He pointed out that the fact that in the past this Board had been mixed had, in his opinion, helped considerably in achieving the measure of success achieved by the Board in the performance of difficult and delicate duties. I agree fully. Also I am sure all here agree that it is inconceivable in modern Ireland, as we know it, in the sort of society we have succeeded in building up here for ourselves, that there should be any question of a body such as the Charity Commissioners not continuing to be mixed in its memberships in the same way as it has been in the past. I do not think there are any other matters which I need comment upon at this stage except to recommend the Bill to the House.
The Parliamentary Secretary is going to amplify his statement that the Charity Commissioners could not participate in a legal procedure?
The Leader of the Opposition is still trailing his political coat?
I am seeking an explanation of Section 23.
The Leader of the Opposition will recall that what I said was that the Charity Commissioners do not contest actions. That is quite true. I did not state that they could not legally do so; I said they do not do so, and neither do they, as a matter of practice. Apart from that, if the Leader of the Opposition will study Section 23 carefully, he will see it has a very restricted, narrow application. It deals purely with the case where the Board sue for the recovery of charitable gifts improperly withheld, concealed or misapplied. Even then, the Charity Commissioners could do that only with the consent of the Attorney General. They would be the instrument of the Attorney General in counteracting a fraud. This is a completely different sort of thing from what the Leader of the Opposition was speaking about when I contradicted him and said the Charity Commissioners do not contest actions. As a matter of practice they do not. Suing for the recovery of money misapplied is not contesting an action.
They can start them.
I said they do not and have not done so.
Under Section 23 and Section 24, have they power?
The Leader of the Opposition is now going on to Section 24. These are matters we can go into more fully on Committee Stage. Let me deal with the exact point at issue between us before Question Time. The Charity Commissioners do not contest legal actions. They have certain specific powers given to them in both of these sections.
In Section 25 and 26. The Parliamentary Secretary should be a little more circumspect in his answers "off the cuff".
I simply contradicted the Leader of the Opposition when he claimed that Section 13 was a new section and also when he said that the Charity Commissioners contest actions.
Question put and agreed to.
Next Stage?
This day month.
Committee Stage ordered for Thursday, 1st December, 1960.