Are we looking forward to being a membership charity?

[JT]

BikeBiz the cycling trade magazine/website has just published a press release about the proposed move to charitable status. In an article titled CTC planning to become membership charity, the following quotes appear:

Chair of CTC Council David Robinson said: “Under changes in the Charities Act 2006, many of our founding and historic activities can now be deemed as charitable.

"We are calling on our members to give a resounding vote in favour at our AGM, so we can go forward as a cyclists’ charity and achieve even more. We’ll also qualify for Gift Aid so members will be able to donate even more money to our campaigning and development work, without having to pay any extra.”

CTC Chief Executive Kevin Mayne added: “CTC remains the largest cycling organisation in the UK. We’ve just wrapped up our financial year and, despite the credit crunch, we are looking stronger than ever. More people than ever have decided to join CTC and support the work we do. The more members we have, the more we can do to improve cycling across the UK.”

Reading this you'd be forgiven for thnking that CTC is just about campaigning and "development work".

Full article here: http://www.bikebiz.com/news/31611/CTC-planning-to-become-membership-charity

[glueman]

That press release is a load of marketing soundbites. While ever council talks in those terms I feel something is being hidden. Can we have some substance: facts and figures please.

[MartinC]

In the absence of the cycling equivalent of political parties, there is unlikely to be a Plan B because there is nobody with the organisation and resources to devise a proper alternative and to canvass support across the membership. If things trundle on as they are it will either be approved or something quite unpredictable will emerge because enough people have become worried about what is happening. (And back to party politices, without opinion polls nobody will have much idea of which way it would go. The worriers may be fewer than the satisfied but are likely to be more active.) It seems to me it's either an organised pause or the dangers of unpredictability.

If that is the case, is it not now time to canvas for a change from the autocratic management we have now?

+1

Organisations are always much stronger if they do things in a transparent and inclusive way. This could end up in a mess if there's only a Plan A which fails because it's not been presented well enough to get (or the proposers just don't have) the support of the few members who'll vote.

[Simon L6]

Chair of CTC Council David Robinson said: “Under changes in the Charities Act 2006, many of our founding and historic activities can now be deemed as charitable.

I really don't know how he has the gall to write that stuff - supposing he wrote it. They want gift-aid to reduce the losses on the contracting work. I'm sorry if that sounds a bit intemperate, but, what with this and the constant drip, drip, drip in Newsnet and those dreary (and thoroughly misleading) articles in Cycle I'm getting just a little hacked off.

[bikepacker]

How many members are needed to force a vote of no confidence in the management?

[simonconnell]

I'm sorry if that sounds a bit intemperate, but, what with this and the constant drip, drip, drip in Newsnet and those dreary (and thoroughly misleading) articles in Cycle I'm getting just a little hacked off.

Yes, it does sound a little intemperate. I have similar feelings about constant unsubstantiated comments like these;

They want gift-aid to reduce the losses on the contracting work.

If you can demonstrate to me, using published CTC financial statements, that this is happening, I'll eat my Rapha cap

[meic]

"If you can demonstrate to me, using published CTC financial statements, that this is happening, I'll eat my Rapha cap"

Does that mean that you're agreeing with him about the inadequecies of the published financial statements?
Is this yet another call for a change of auditors?

If someone has to prove something, they can at least choose their own method cant they.

[MartinC]

If you can demonstrate to me, using published CTC financial statements

One of the reasons for the discontent is that very little can be established using published CTC information. If everything is fine then just posting detailed accounts will be enable everyone to see. Chiding people for wanting to know more just reinforces the rapidly growing feeling that this lack of transparency isn't accidental. Everytime someone posts like the above I guess another couple of members make up their mind against the changes, it really doesn't help the pro case.

[Simon L6]

I think that's the nub of it.

There's no great secret being revealed here, but we're having the published (and the unpublished) accounts gone over by an Accountant. I'm not pulling figures from the sky in the way that the published accounts do (and I'm still waiting for an explanation for the £388,000 appearing in the 2008 accounts).

Fair play to Simon, though - he's fronting up. That is pretty darn admirable in my view. And, in fairness, Simon is one of those who are doing their best to unravel what is, by common consent, a real muddle. It's a pity that there isn't always the co-operation and support his efforts, and those of Barry Flood, John Meudell and our very own Greg Price (aka Regulator), merit. It's also a pity that the Chair is sticking to the line that to publish the accounts would hand BC a competitive advantage in bidding for contracts.

Whichever way you slice the accounts, (and they've been sliced), Thirdcrank's analysis of the situation above holds good. And my plea to Simon and his fellow councillors remains the same. Stop and consider. Sort out the money (and I do not pretend that this is easy). Put yourself in a position to offer the members something they can rely on and you will get wide support. The present course is unneccessary, divisive, and unpredictable.

[ecila]

We don't have to fall in with CTC's line on becoming a charity - as members we all have the right to vote to remain a club run as a limited company.

CTC won't collapse if we stay as we are.

[Regulator]

Chair of CTC Council David Robinson said: “Under changes in the Charities Act 2006, many of our founding and historic activities can now be deemed as charitable.

"We are calling on our members to give a resounding vote in favour at our AGM, so we can go forward as a cyclists’ charity and achieve even more. We’ll also qualify for Gift Aid so members will be able to donate even more money to our campaigning and development work, without having to pay any extra.”

Contrary to what is being said by the proponents of these changes, the proposed new structure will put the 'public interest' first. The members and their benefits will be secondary.

Effectively, members will become second class citizens in their own club. Council and National Office will be able to override the wishes of members, even where instructed by an AGM, using the 'public interest' argument.

I am currently working on a document that takes an honest and hard look at the suggested 'benefits' of the changes - and what they would mean for the membership. It's taking some time as there are numerous and significant areas of concern. When it is complete, I'll post it here for everyone to see.

[John Catt]

I reckon this would leave about £1.5M with the Trust and £0.5M with the CTC. My guess is (bearing in mind say 10K members would choose to join both) that the CTC would end up with 15K members and the Trust with 55K members so the CTC would end up with more assets per member.

I'm curious as to why it is thought that in the event the two parts were split that 45K current members would be interested only in the national campaigning by the CTC Trust and not the CTC for it's local sections, 3rd party insurance, magazine etc. My guess would have been that most current members would just carry on being members of both or alternatively decide that it was the cycling and not the campaigning they were wanting and would therefore chose to just be members of the CTC.

I did say it was a guess.

There would be nothing to stop the "Trust" offering 3rd party insurance and a magazine etc. It would just be that they would be focussing on the national picture whilst the CTC would be focused on the local groups and traditional touring.

All this of course is total speculation on my part so please take with a ton of salt.

I thought I'd set out a bit more of the basis of my guess in the blog and I've copied it below.
http://witherthectc.blogspot.com/2010/01/alternative-strategy.html

Clarification of Guesstimate

My guess was based on total membership of 60K. Of this number, based on my local groups membership data and activity, together with various bits of information garnered from national office, I estimate that the percentage actually active in groups is between 15% and 25%. Going with the more optimistic figure gives the 15K.

Bearing in mind that this 15K will include our keenest and most active members, I surmise the two thirds of them would want to support an organisations supporting the promotion of cycling nationally as well as wanting the traditional club. Hence 10K people with membership of both organisations.

With regard to member benefits, there would be nothing to stop the charity offering these. They virtually all promote cycling and so would fall within the charitable objectives. So third party insurance and a magazine could be offered by both organisations. The charity would I believe be supported by those members who join because they wish to support it in its promotion of cycling nationally together with some membership benefits.

I must just emphasise that I think a split would be disasterous. The "CTC" would be a small enfeebled "club" without the mass to get economies of scale in its organisation and I don't believe that active members would get any discernibly better service from it, than from a combined charity.

[John Catt]

Chair of CTC Council David Robinson said: “Under changes in the Charities Act 2006, many of our founding and historic activities can now be deemed as charitable.

"We are calling on our members to give a resounding vote in favour at our AGM, so we can go forward as a cyclists’ charity and achieve even more. We’ll also qualify for Gift Aid so members will be able to donate even more money to our campaigning and development work, without having to pay any extra.”

Contrary to what is being said by the proponents of these changes, the proposed new structure will put the 'public interest' first. The members and their benefits will be secondary.

Effectively, members will become second class citizens in their own club. Council and National Office will be able to override the wishes of members, even where instructed by an AGM, using the 'public interest' argument.

I am currently working on a document that takes an honest and hard look at the suggested 'benefits' of the changes - and what they would mean for the membership. It's taking some time as there are numerous and significant areas of concern. When it is complete, I'll post it here for everyone to see.

Regulator has inspired another couple of blog pages with this post.

The first you can find at
http://witherthectc.blogspot.com/2010/01/is-ctc-here-for-member-or-public.html
Is the CTC here for member or public benefit?
On the CTC Forum Regulator (Sat Jan 09, 2010 5:24 pm) quoted the chair of CTC Council David Robinson:

“Under changes in the Charities Act 2006, many of our founding and historic activities can now be deemed as charitable.

"We are calling on our members to give a resounding vote in favour at our AGM, so we can go forward as a cyclists’ charity and achieve even more. We’ll also qualify for Gift Aid so members will be able to donate even more money to our campaigning and development work, without having to pay any extra.”

and then wrote:

"Contrary to what is being said by the proponents of these changes, the proposed new structure will put the 'public interest' first. The members and their benefits will be secondary."

Here I think lies the nub of the argument. Yes, if the CTC becomes a charity it must put the public benefit first. That is the definition of a charity.

To quote the Charity Commission: "Charities are more than ‘a good thing’ and, as their supporters recognise, are special. Not all organisations can be charities. To be a charity is a mixture of what you are, what you do and how you do it. The core characteristic is public benefit. Whilst the charitable sector is enormous and very diverse, the aims of each and every charity, whatever their size, must be for public benefit. Public benefit is therefore central to the work of all charities." http://www.charitycommission.gov.uk/publicbenefit/publicbenefit.asp#a

When I joined the CTC back in mid 1980s I did so because I heard a radio programme about it years before, which had impressed me, and subsequently picked up a magazine that featured it. This made clear that it was the main organisation for promoting cycling in the UK and offered member benefits such as the magazine. I joined principally to support it in promoting cycling as I was using a bicycle for much of my local transport needs.


After I joined the Secretary of the DA contacted me and tried to persuade me to go out with the section. I only had an old 3 speed utility bicycle at the time, but I did turn up at the start one winters morning to find a bunch of riders with some impressive bikes. I quietly disappeared without introducing myself.

After reading a few issues of Cycle Touring I had some money to spare and bought a tourer. Then I had the courage to go along and try out a section ride. I found it quite hard at first but gradually got used to it. I eventually did some quite long reliability and audax rides and thoroughly enjoyed club riding.


However my original and still main reason for belonging to the CTC is to help it promote cycling in all its forms, including club riding. I believe many cyclists have and do join for just this reason.

I regard clubs such as the CTC as mutual societies. Membership is open to all and the assets of the club are held in trust as benefit to society, very much including members. Many of those who provided those assets will have left or died, but I believe saw their contribution as being a "public benefit".

I don't believe that members who left substantial legacies did so in order that members could maximise their personal benefits, but to allow the club to promote cycling, and particularly cycle touring, within the population as a whole.


So I believe that "public benefit" is the principal reason for the CTC existing in its present form and so charitable status is an obvious way to go, whilst allowing the organisation to still provide benefits to members, since these are fully in line with its role in promoting cycling.

[meic]

I am of the other type who joined the CTC as a Cycle club to group with other members to share resources, information and work togrther for the MEMBERS mutual benefit.

With such a difference of opinion it doesnt make sense to merge the two different approaches into one organisation which favours your view over mine.

[John Catt]

and here is the second.

As a Charity will the CTC Council be able to override the wishes of its members?
On the CTC Forum Regulator (Sat Jan 09, 2010 5:24 pm) wrote:

"Effectively, members will become second class citizens in their own club. Council and National Office will be able to override the wishes of members, even where instructed by an AGM, using the 'public interest' argument."

Here I have to point out that the Council (which controls National Office) can already over-ride the instructions of an AGM. In law an AGM and the M&AA can only restrict what a Board does. They can't make it do anything.

By way of example, suppose a resolution was passed at a Company AGM instructing it to put a man on the moon next year. They wouldn't have the resources and so would ignore the instruction. It would also be outside the objective of the organisation so they could be found liable if they used any of the organisations resources trying.

Of course shareholders could replace the Board at the next election, but the instruction wouldn't have been carried out. That said it is probably only a foolish Board of directors that would ignore a resolution of shareholders.

Indeed under the current law the Council have to put the objects of the CTC before the members wishes.

This can be demonstrated from our history.

To quote from Wikipedia: http://en.wikipedia.org/wiki/Cyclists%27_Touring_Club#CTC_and_motorists

"In 1906 CTC asked the High Court to amend its constitution so that it could admit all tourists, including car-drivers. A majority of members - 10,495 to 2,231 - had voted the previous year for the change to take place. The court ruled that CTC could not protect the interests of cyclists and drivers at the same time and denied permission."

In the UK, the Companies Act 2006 requires directors of companies "to promote the success of the company for the benefit of its members as a whole", but sets out six factors to which a director must have regards in fulfilling the duty to promote success. These are:

* the likely consequences of any decision in the long term
* the interests of the company’s employees
* the need to foster the company’s business relationships with suppliers, customers and others
* the impact of the company’s operations on the community and the environment
* the desirability of the company maintaining a reputation for high standards of business conduct, and
* the need to act fairly as between members of a company

( Taken from Wikipedia)

I would suggest that the real issue is does the Council properly represent the membership? This of course has nothing to do with whether or not the CTC is a charity.