The University-Charity

This book contains the first study of universities through a charity law lens. Heralded as “trailblazing”, “magisterial” and “stimulating, comprehensive and innovative”, The University-Charity is a hugely important addition to the literature, challenging common perceptions of universities as large businesses and/or public sector bodies, and offering a new perspective for university governors, leaders and academics alike.

• THE UNIVERSITY-CHARITY
• ISBN: 978-1-3999-4630-8
• Hardback
• 526 pages
• Date of publication: March 2023
• Price: £120 (hardback); £45 (paperback)
• Scholars’ discount available

Most universities are described as either registered or exempt charities, but very little attention is paid to their charitable status, or its significance.

For the first time, this book examines universities through a charity law lens. It interrogates – and challenges – the proposition that all not-for-profit universities are charities as a matter of law, and examines the consequences of charitable status: both in terms of the way universities operate and in terms of their relations with the State. Charity law has a valuable contribution to make to current debates surrounding university practices, not least in respect of education and research, executive remuneration, and governance. It also has a critical role to play in marking out – and defending – the boundary between charity and government. The University-Charity examines the legal and regulatory framework, and asks to what extent universities demonstrate that vital ‘hallmark of charity’: the need to be – and to remain – independent of government. The recent transactions involving the College of Law and Regent’s University, both formerly charitable institutions which are now operated on a for-profit basis, are also examined against a charity law framework.

It will be seen that the University-Charity can be expected to behave differently from other universities, and to be treated differently.

Quick reviews

Chapters

• 1 Introduction: explaining the rationale, significance and scope of The University-Charity.
• 2 The University and the University Sector: defining ‘university’ for the purposes of the book and setting out a chronological outline of the sector’s development, highlighting its expansion and transformation, and the changing relationship between universities and government.
• 3 The Charity and Charity Law: sets out what constitutes ‘charity’ in law and asks whether universities satisfy this test, revealing several obstacles in the way of concluding that the former polytechnics ever left the public sector and became charities. It also summarises the scope of ‘charity law’ – a complex and widely misunderstood area of law – and some of the consequences of charitable status, including generous tax privileges.
• 4 Acting in the Best Interests of the Charity: examining the overriding duty of all charities to act in the best interests of furthering their charitable purposes – not synonymous with acting in the ‘best interests of students’ – and what this means in the university context. Might a university’s operational and strategic decision making, its culture and ethos, be any different if its charitable purpose were to be placed centre stage?
• 5 Executive Remuneration: asking what charity law has to contribute to the matter of executive remuneration (not addressed in any detail by Charity Commission guidance) and applying this law to practices in the university sector. Should a charity, for example, pay its CEO (or Vice-Chancellor) a sum of money for not offering his or her services to another similar charity following retirement?
• 6 Governance: tracing the evolution (in many universities) to a ‘corporate model’ of governance, in which top-down structures diminish academic involvement, and asking to what extent such a corporate model (which does not at the same time adopt the accountability measures applicable to large businesses) can possibly provide the purpose-based governance that charity law demands.
• 7 The University-Charity and the State: addressing the requirement that all charities must be – and remain – independent of the State, something not immediately obvious in the statutory definition of ‘charity’ and under increasing strain in practice. With a particular focus on the regulatory framework in respect of access and participation and student fees, this chapter asks to what extent universities can demonstrate this independence, which goes further than the ‘institutional autonomy’ of higher education legislation.
• 8 Public Benefit: asking why it is that universities have not received the same scrutiny as independent schools over their practices in widening access and participation – typically (but mistakenly) understood to be what the ‘public benefit requirement’ in charity law is all about. Does this inconsistency add weight to the view that the Commission’s approach (and the judgment in the Independent Schools Council case) lacked legal justification and coherency, and was far more about policy than law?
• 9 Holding the University-Charity to Account: examining the post-2006 legal and regulatory framework, which (broadly speaking) makes the Charity Commission and OfS responsible for promoting universities’ compliance with charity law. How effective has this been, and what realistic prospect is there of universities being held to account as charities?
• 10 The University-Charity: Up for Sale? seeking to understand the ‘sales’ of the (charitable) College of Law and (charitable) Regent’s University to private equity purchasers – both transactions about which the Charity Commission has chosen to provide no information publicly – and asking to what extent obvious dangers in such transactions are protected against (in theory and in practice) by the little-understood charity law framework that applies.  
• 11 Conclusions: drawing together conclusions from the preceding chapters, and outlining ideas for further reflection, research and reform.