Monks’ charitable status challenged

Today, BBC Devon carried the story “Strip ‘violent wine’ monks of charity status, say secularists“; this states: “monks who make Buckfast tonic wine linked to violent crime in Scotland should be stripped of charitable status…The National Secular Society says the beverage made at Buckfast Abbey in Devon is harmful. Buckfast Abbey Trust does not pay tax on the income because it is a charity, which the society claims is an “abuse of the charitable system'”.

Background

William Hogarth’s print Gin Lane (1751), depicted the evils associated with drinking gin, and was produced in support of what became the Spirit Duties Act 1735 (a.k.a. the Gin Act of 1736); The gin cellar in the print, Gin Royal, advertises its wares with the slogan: “Drunk for a penny; Dead drunk for twopence; “Clean straw for nothing“.

This was reflected in a recent Guardian article on Buckfast, “Life in the Buckfast Triangle: Drunk by noon, handcuffed by midnight“. [The “Buckfast Triangle” is said to be between Airdrie, Coatbridge and Bellshill]. The Scottish Government states:

“The alcohol problem in Scotland is so significant that ground breaking measures are required. Given the link between consumption and harm and evidence that affordability is one of the drivers of increased consumption, addressing price is an important element of any long-term strategy”.

The Alcohol (Minimum Pricing) (Scotland) Act 2012 was passed in June 2012 but the legislation has not yet been implemented due to a legal challenge led by a trade body, the Scotch Whisky Association, here.

The NSS complaint relates to the charitable status of the Buckfast Abbey Trust (Held icw The Religious Community Of Benedictine Monks Established At St Marys Abbey Buckfast, Devon, infra.

Background

Latest Charity Commission data are for the financial year ending 31 October 2015 show: a total income of £8.8M, of which £7.30M is from trading to raise funds; a total spending of £8.5M, of which £3.08M relates to trading to raise funds. Media references to a profit of £8.8M in the past year are clearly wide of the mark.

Other relevant information is summarized as:

Aims & activities: Its primary activity is to maintain and support the Benedictine Community of monks at Buckfast Abbey.

What the charity does: Religious activities

Who the charity helps: Other defined groups; The general public/mankind

How the charity works: Provides human resources; Provides buildings/facilities/open space; Provides services; Other charitable activities.

This charity has one or more trading subsidiaries and is recognised by HMRC for gift aid. Its charitable objects are: “To promote or maintain any charitable purpose connected with the Roman Catholic religion”. More detailed information is included in the Trust Annual Report 2015. The Trustees Report explains:

“Buckfast Tonic Wine is produced by the monks through Dart Abbey Enterprises Limited. The Wine is sourced, bottled and distributed by J Chandler & Co (Buckfast) Ltd and the Buckfast Abbey Trust receives a royalty for each litre sold. This has proved to be a valuable source of revenue for the charity and enabled it to build up its reserves and allow the trustees to advance its charitable objectives.”

NSS Complaint

In a letter to the Commission, the NSS suggests that the charity’s activities “fall short of the requirement to act in the Public’s Benefit”. Stephen Evans, NSS campaigns director, commented: “Charitable status and the accompanying tax benefits should only be granted to organisations that deliver a demonstrable public benefit. In the case of Buckfast Abbey, the social harm caused appears to outweigh any public good. Where this happens, or where the good is simply not good enough, public confidence in supporting charities risks being undermined”.

The NSS has also raised concerns about the charity and associated companies being run for “considerable private benefit running to millions of pounds a year”. In its letter to the Commission, the NSS said: “Excessive director pay, commercial loans to companies run by religious colleagues and charity staff allowed to profit privately from property investments all point to an abuse of the charity system.”

Comment

The Charity Commission is the arbiter of  “the requirement to act in the Public’s Benefit”, and will consider the NSS’s assertions. The Commission states that in the public interest “it usually: releases a public statement whenever it opens a statutory inquiry into a charity; publishes a report of the inquiry. Published statements and reports are shown on the charity’s entry on the public register of charities”. We await developments with interest.

Cite this article as: David Pocklington, "Monks’ charitable status challenged" in Law & Religion UK, 11 April 2017, http://www.lawandreligionuk.com/2017/04/11/monks-charitable-status-challenged/

8 thoughts on “Monks’ charitable status challenged

  1. I know Scottish government ministers have pleaded with Buckfast authorities to stop sending their fortified wine north as it is turning Scots youth “vile aggressive violent and anti-social” (sic)

  2. Where to even start with this one…

    Firstly, it is worth making the really blindingly obvious point here that the Charity Commission regulates charities and not non-charities. Neither the company that produces the wine, nor the company that bottles and markets it are charities.

    The NSS’s statement in the press release that “In 2016, the charity’s trading arm, J Chandler (Buckfast) Ltd, employed just 28 people yet paid an average of £144,984 to each person.” is horribly misleading, because J Chandler isn’t the charity’s trading arm. It is a body in which the charity holds an investment interest (32.4% of voting rights). The Charity’s trading subsidiary is Dart Abbey Enterprises Limited. A 32.4% shareholder cannot control what staff are paid. And what staff are paid in a non-charitable company is none of the Charity Commission’s (or, to be frank, the NSS’s) business.

    J Chandler (Buckfast) Ltd accounts note that they paid corporation tax of around £700k last year. It is they who sell the wine (I think that’s the only thing the company does) and they report sales of around £42 million, with a profit of £3.5 million before tax.

    The charity does admittedly hold the trade-mark, which it presumably licenses to the bottler/marketer. The trade-mark is the intellectual property of the charity, and commission guidelines is that property of this nature held by a charity be used to generate income.

    • Dart Abbey Enterprises Limited is 100% owned by the charity and run by the same directors as the charity itself. The trading company produces the tonic wine and sells it on to J Chandler while gifting all profits to the charity, by this arrangement it is clear Buckfast Abbey is the producer of the wine.

      J Chandler (Buckfast) may be an associated (not separate) non-charitable company but such organisations are taken into consideration when assessing the Public Benefit of a charity, especially with regards to any Private Benefit. In ‘The Advancement of Religion for the Public Benefit’ the question is posed;

      “E4. Does anyone receive any private benefit from your organisation, other than as a beneficiary? If so, what benefits do they receive? Are those benefits incidental?
      In this guidance, a private benefit is a benefit that a person or organisation receives other than as a beneficiary of a charity. Private benefits can range from one-off payments for services, such as painting a charity’s premises, to a contractual arrangement for ongoing services to achieve or support a charity’s aim. ”

      J Chandler provides wine distribution services to Buckfast Abbey and so does hold a contractual arrangement for on-going services, because of this it is legitimate the Charity Commission take their salaries into consideration.

      In the same paper the Charity Commission gives another example of excessive Private Benefit;

      “However, in other circumstances, we may take the view that benefits to members of a religious community are more than incidental. For example, an organisation set up to advance religion operates as a religious community whose small number of members and the trustees derive significant personal benefit from the lavish property they reside in, financed by their trading activities, which are extensively interwoven with the operation of a commercial company. The benefits here would be more than incidental since the amount of charitable activity is minimal and any public benefit is outweighed by the extensive private benefit derived by the members of the religious community.”

      Seems to fit Buckfast Abbey quite closely don’t you think?

  3. The central point is Buckfast Abbey is a religious charity. It allows to be made, under its trade-mark and I suppose using its intellectual property of the recipe, a product which has been accused of causing medical and social harm. The making of this product is done at a profit not at a loss. No matter how this profit is “laundered” – eventually some money is returned to Buckfast Abbey. Presumably the monks follow the NRA line “blame the shooter not the gun”.

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