Governance Review - Member Consultation closed 12 Dec 10:00am

Steady rider
Posts: 2269
Joined: 4 Jan 2009, 4:31pm

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby Steady rider » 1 Dec 2016, 9:10am

6.1.4 Members (including Trustees) who are beneficiaries of the Charity may receive charitable benefits from the Charity in that capacity.


What are the limits to such benefits?

User avatar
Graham
Moderator
Posts: 6419
Joined: 14 Dec 2006, 8:48pm

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby Graham » 1 Dec 2016, 9:18am

Thanks Gaz, I did not know that it was an amendment.

In the old setup I can understand there may be circumstances in which a member / councillor would feel the need to provide a benevolent financial arrangement to the Club.

Now that the organisation has changed to a charity and the concept of members "owning the organisation" is lost I would guess that any benevolent motivation has gone with it . . . . . leaving what sort financial arrangement between an organisation and its officer ?

User avatar
gaz
Posts: 14113
Joined: 9 Mar 2007, 12:09pm
Location: Kent, lorry park of England

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby gaz » 1 Dec 2016, 10:06am

Despite the references to "Club" those clauses came in as part of the Charity conversion. Proposed AoA changes to 2010 AGM. I expect they are fairly much standard phrases required in the governing documents of a Charity to prevent abuse of any financial arrangements between the Charity and its Trustees.

My point is that anyone who feels the Trustees have not drawn the members attention to these clauses, because the Trustees need them changed to fulfil some dark Machiavellian plot, should be aware that these particular amendments are doing nothing more than tidying up the language being used in the current AoA.

If the amendments are rejected any supposed dark Machiavellian plot will still be able to proceed :wink: .
Missing, presumed fed.

User avatar
Graham
Moderator
Posts: 6419
Joined: 14 Dec 2006, 8:48pm

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby Graham » 1 Dec 2016, 11:24am

No dark Machiavellian plot intended. ( At least that is what they want me to think. :wink: )

Due to the change in the nature of the organisation perhaps they no longer relate to "real world" possibilities and should be removed ?

User avatar
gaz
Posts: 14113
Joined: 9 Mar 2007, 12:09pm
Location: Kent, lorry park of England

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby gaz » 1 Dec 2016, 12:54pm

Again the clauses only went in when the Club became a Charity, when members were assured that the changes to the AoA were the minimum required to achieve Charity status.

Such clauses appear in the Charity Commission's Model AoA and whilst I cannot go so far as to state they are mandatory they can perhaps reasonably be viewed as standard provisions for a Charity.
Missing, presumed fed.

Steady rider
Posts: 2269
Joined: 4 Jan 2009, 4:31pm

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby Steady rider » 1 Dec 2016, 1:08pm

The model states
(d) A director or connected person may receive interest on
money lent to the charity at a reasonable and proper rate
which must be not more than the Bank of England bank
rate (also known as the base rate).
(e) A director or connected person may receive rent for
premises let by the director or connected person to the
charity. The amount of the rent and the other terms of
the lease must be reasonable and proper. The director
concerned must withdraw from any meeting at which
such a proposal or the rent or other terms of the lease are
under discussion.



The draft articles state;
6.1.2 Members (including Trustees) may be paid interest at a reasonable rate on money lent to the Charity;
6.1.3 Members (including Trustees) may be paid a reasonable rent or hiring fee for property or equipment let or hired to the Charity; and


The requirements have been shortened and leaves room for uncertainty about a reasonable rate. The Bank of England base rate is currently 0.25%.4 Aug 2016.
Members could perhaps get 1% - 2% from funds via other means. Members would be loosing out and also the club could be getting into large debts and paying little interest, if say 0.25% or less. If the bank rate increased to 3% they may not be able to pay their way.

What prevision for life members is included?
currently the AoA state
14 LIFE MEMBERSHIP ACCOUNT
14.1 All money which may be received by way of composition fees from life Members of the Club shall, after
deduction of any Value Added Tax payable thereon, be credited to a special reserve named the “Life
Membership Fund”. Four per cent of the amount credited in each accounting year commencing after
30th September 1982 shall be transferred to the Revenue Account and like amounts shall be
transferred in each of the subsequent 24 years. No other transfers shall be made until all other reserves
of the Club have been exhausted in which case the Members may by ordinary resolution approve such
transfer as they may think fit.


The proposed AoA does not have a heading 'life members' and seems to have no provisions to protect their investment.

User avatar
gaz
Posts: 14113
Joined: 9 Mar 2007, 12:09pm
Location: Kent, lorry park of England

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby gaz » 1 Dec 2016, 1:44pm

Steady rider wrote:The requirements have been shortened.

The model is not a list of requirements, it is a starting point from which an organisation can develop its own AoA.

The three clauses all exist in the same form in our current AoA. There was considerable member scrutiny of the revised AoA when we became a Charity. I expect that if these clauses were contentious Regulator would have been drawing them to our attention either on here or on savethectc. I don't recall any specific concerns being voiced at the time. The proposed AoA neither shortens nor fundamentally alters any of the existing clauses, it is just an update to the terminology.

The Charity operates within a legal framework of which the AoA are just one part. The Trustees must always act in the best interests of the Charity.
Missing, presumed fed.

Steady rider
Posts: 2269
Joined: 4 Jan 2009, 4:31pm

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby Steady rider » 1 Dec 2016, 2:09pm

gaz » 1 Dec 2016, 1:44pm

Steady rider wrote:
The requirements have been shortened.
The model is not a list of requirements, it is a starting point from which an organisation can develop its own AoA
.

I would expect the model to be the starting point and include those provisions detailed, not to omit parts that leave room for changing the meaning. Extending conditions from the model to add more protection I think is reasonable but to shorten the provisions is disregarding the details suggested and makes then less safe in a set of AoA that need to be water tight where possible. Unless there are good reasons to shorten the provisions suggested, they should not be approved in my view, what are the good reasons to shorten the model?

User avatar
gaz
Posts: 14113
Joined: 9 Mar 2007, 12:09pm
Location: Kent, lorry park of England

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby gaz » 1 Dec 2016, 2:20pm

Steady rider wrote:The proposed AoA does not have a heading 'life members' and seems to have no provisions to protect their investment.

Life membership subscriptions go into a pot and are drip fed into the general fund over 25 years.

The current accounting structure is in place to cover the costs of life members, not to protect their investment (Commentary to Annual Accounts pdf p52).

Even so it's ommision from the proposed AoA is notable, perhaps Steady rider could make further enquiries.

Steady rider wrote:Unless there are good reasons to shorten the provisions suggested, they should not be approved in my view, what are the good reasons to shorten the model?

I do not know why the provisions currently in our AoA are shorter than those in the CC model. They are already approved. Both our members and the CC found them acceptable in their current form. They are not new provisions.
Missing, presumed fed.

User avatar
gaz
Posts: 14113
Joined: 9 Mar 2007, 12:09pm
Location: Kent, lorry park of England

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby gaz » 1 Dec 2016, 4:29pm

I've taken some time to look at printed copies of the current AoA and proposed AoA. My main aim has been to look for material differences that have not been brought to members attention within the consultation. I have not examined every clause that bears similarity to the existing version of the AoA and to question whether it is appropriate. I have not gone over them with a fine tooth comb and I may have missed points others would feel to be of significance.

Aside from the points I have already raised in the thread, and that raised by Steady rider regarding the Life Membership Fund, I note* one other clause (my bold).
10.6 The Trustees may establish different classes of Members and recognise one or more classes of supporters who are not Members (but who may nevertheless be termed as “members”) and set out their respective rights and obligations (including payment of Membership Fees save that such fees may not be imposed until approved by the members).

There are already various membership categories (junior/adult/unwaged/family/student/corporate/etc), there are already different rights (Affiliated Members cannot vote or lead MG rides). A "CTC Membership Benefits Table" on which the details of such rights and obligations may be set out has been mentioned before on the forum, I have never seen a copy.

To my knowledge this is the first time the word supporters has been used to describe any category of member.

*Hilary Reed has commented elsewhere on this clause which first brought it to my own attention.
Edit: Typo.
Last edited by gaz on 1 Dec 2016, 7:36pm, edited 1 time in total.
Missing, presumed fed.

AndyK
Posts: 946
Joined: 17 Aug 2007, 2:08pm

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby AndyK » 1 Dec 2016, 5:06pm

Another notable change: the current AoA specify that each elected Councillor (Trustee) will represent a specific "Division" of the country. At present, Council has got round that rule by declaring the whole country to be a single division, which is within the letter (though hardly the spirit) of the rules.

In the revised AoA, any reference to councillors representing a specific division has been removed. It appears that the trustees find this idea of divisional representatives (and by implication, a trustee having a responsibility to represent the members in a division) so scary that they want to stop anyone changing the structure back to that in the future. Effectively they're burning the bridges behind them. If the new "division-less" structure of Council turns out not to work, too bad - there's no easy route back.

AndyK
Posts: 946
Joined: 17 Aug 2007, 2:08pm

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby AndyK » 1 Dec 2016, 5:45pm

What worries me most is the attitude evident in the proposed changes to the "poll of the whole club" procedure.

In another organisation the trustees might be saying, "Hmmm - a lot of members seemed to be unhappy with the way we handled the name change, so much so that they went to all the trouble to raise a petition and force a poll of the whole club. That's pretty serious. Maybe we didn't handle the name change very well. We should review those events to find out how we and the staff can improve on member consultation in the future, so that people don't feel the need to invoke the poll clause again."

Instead our trustees are saying, "Hmmm - that was inconvenient. Some upstart members dared to question our judgement. I know - let's change it so that if anyone does propose a poll of all the members, we can victimise the instigator and threaten him/her with financial ruin. That'll make them think twice."

User avatar
gaz
Posts: 14113
Joined: 9 Mar 2007, 12:09pm
Location: Kent, lorry park of England

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby gaz » 1 Dec 2016, 6:40pm

AndyK wrote:Instead our trustees are saying, "Hmmm - that was inconvenient. Some upstart members dared to question our judgement. I know - let's change it so that if anyone does propose a poll of all the members, we can victimise the instigator and threaten him/her with financial ruin. That'll make them think twice."

Except that isn't what the Trustees have said, just how you have chosen to interpret it.

IMO the last two Polls of the Whole Club (the only ones of which I have any knowledge) were lodged in good faith.

I can imagine Polls of the Whole Club being lodged for less wholesome motives and I feel it is appropriate for the Trustees to seek to protect the Charity from such actions.

I'm only surprised that they feel the relevant clause should not simply be deleted from the AoA, then again I wouldn't expect to find myself in agreement with everything the Trustees do :wink: .
Missing, presumed fed.

AndyK
Posts: 946
Joined: 17 Aug 2007, 2:08pm

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby AndyK » 1 Dec 2016, 6:48pm

gaz wrote:
AndyK wrote:Instead our trustees are saying, "Hmmm - that was inconvenient. Some upstart members dared to question our judgement. I know - let's change it so that if anyone does propose a poll of all the members, we can victimise the instigator and threaten him/her with financial ruin. That'll make them think twice."

Except that isn't what the Trustees have said, just how you have chosen to interpret it.

IMO the last two Polls of the Whole Club (the only ones of which I have any knowledge) were lodged in good faith.

I can imagine Polls of the Whole Club being lodged for less wholesome motives and I feel it is appropriate for the Trustees to seek to protect the Charity from such actions.

I'm only surprised that they feel the relevant clause should not simply be deleted from the AoA, then again I wouldn't expect to find myself in agreement with everything the Trustees do :wink: .

It is indeed my interpretation. Your interpretation is more charitable. Much more charitable. The fact remains that the only follow-up we've seen from those unfortunate events is an attempt to change the Articles to deter people from doing it in future, for whatever reason. No "Sorry, we handled that badly, we'll try to improve."

Steady rider
Posts: 2269
Joined: 4 Jan 2009, 4:31pm

Re: Governance Review - Member Consultation closes 12 Dec 2016.

Postby Steady rider » 1 Dec 2016, 7:16pm

The proposed AoA includes;
13.2 A poll of the Members shall be taken if either one third of the Trustees or 400 Members of the Charity shall within three months of the passing of a resolution in a meeting of the Trustees or a general meeting (a ‘Contested Resolution’) lodge with the Secretary a petition in writing signed by the petitioning Members:
13.2.1 protesting against such resolution, and
13.2.2 asking that a poll of the Members be conducted
(a ‘Petition’).


13.4 Any action taken upon a Contested Resolution before a petition is properly lodged under article 13.2 shall be valid.


13.6 If the Trustees reasonably conclude that a Petition is not lodged in good faith or is designed to achieve aims other than the best interests of the Charity, the Trustees may require the petitioning Members to bear the reasonable costs properly incurred by the Charity in conducting the poll and implementing the result.


I assume if one third of the trustees call for a poll they would not be subject to 13.6 as it mentions 'Members'. Where as these costs may be imposed on the 400 or more individual who signed a petition. I know of no example where a poll has been called that was not in good faith, http://www.cyclinguk.org/sites/default/ ... 101006.pdf
viewtopic.php?t=106377&start=15

There is no evidence to suggest that polls were not lodged in good faith. It can reasonably be concluded that;

AndyK wrote:
Instead our trustees are saying, "Hmmm - that was inconvenient. Some upstart members dared to question our judgement. I know - let's change it so that if anyone does propose a poll of all the members, we can victimise the instigator and threaten him/her with financial ruin. That'll make them think twice."


In other words they have not acted in a charitably spirit towards there members but have tried to intimidate them into not lodging objections to trustees decisions, a form of maladministration perhaps.

Trustees reasonably conclude that a Petition is not lodged in good faith
its a bit like a judge making a decision, an objection is lodged and the judge fines the objectors, without any outside appeal process. Also if the decision is implemented within a short time (before a petition is properly lodged) it stands as valid according to the AoA.
Last edited by Steady rider on 1 Dec 2016, 7:27pm, edited 3 times in total.