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Private healthcare organisation cannot register as charity, Commission rules

12 December 2007

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An organisation set up to provide private healthcare cannot be registered as a charity because it has not shown that people on a low income could afford its services, the Charity Commission, the independent regulator and registrar of charities in England and Wales, has said.

Odstock Private Care Limited was set up with a loan from the Salisbury NHS Foundation Trust, to carry out private patient  work using Salisbury District Hospital’s facilities – something that a statutory limit prevented the NHS Foundation Trust from charging for itself.

However, the Commission’s decision finds that Odstock’s services are not shown to be available to the public at large, but only to those with the ability to pay its fees. As such, the organisation did not qualify for charitable status.

Andrew Hind, the Commission’s Chief Executive, said: “This decision isn’t unique to hospitals looking to meet an increased demand for the private use of their facilities by setting up a charity – any organisation looking to register as a charity has to exist for the public benefit.

“Providing healthcare facilities can obviously be charitable, but not if those benefits are only available to those who have the means to pay, and not to others.”

Odstock’s application raised issues concerning the law on public benefit in relation to fee-charging charities. This is a sector that will be the subject of forthcoming Commission guidance relating  to the public benefit requirements to be introduced in the  Charities Act 2006.

The removal of the presumption of public benefit on charities advancing religion, education, and relieving and preventing poverty that will come into effect with the Act did not affect this particular case.

Odstock’s purpose of promoting health would not have fallen into any of these categories, and it would have had to demonstrate it was for the public benefit. The application was therefore considered under the criteria that would always have applied to such organisations.

Charity Commission