Debs Grayson argues that news organisations should think twice before pursuing charitable status.

It is widely accepted that new funding models are required for all communities to have access to the news and information they need. One potential avenue for financial support is philanthropy, which is a major player in the US media ecosystem. Philanthropic support is far less common in the UK for a range of reasons, including that many Trusts will only fund charities and it is very hard for news organisations in most of the UK to get charitable status.[1] Making this easier was a recommendation of the Cairncross review, and is advocated for by the Charitable Journalism Project (CJP).

Steve Barnett, Tom Murdoch and Judith Townend from the CJP recently published  “Where public interest and public benefit meet: the application of charity law to journalism”, a comprehensive article outlining how this could work in law. The article is a welcome contribution to the legal debate, including a detailed discussion of ‘public benefit journalism’ which combines the journalistic idea of the ‘public interest’ with ‘public benefit’ charity law. However, while it may be legally possible to make it easier for news publishers to become charities, charitable status and large-scale philanthropic funding in the news sector could have a number of negative impacts which need more consideration.

I run the Media Reform Coalition’s BBC and Beyond campaign, but I also have a strong interest in civil society, social movements and funding[2], and all my experience tells me that news organisations should be extremely cautious about pursuing charitable status. Here are five major reasons why.

1. Being a charity can be a major bureaucratic headache

Charities are much more difficult to administer than other structures like limited companies or Community Interest Companies, and this burden has increased over the past decade e.g. with additional duties under Prevent. Registration can take a long time, especially when the charitable purposes are less well-established, and can involve significant legal fees. Any charity will need a board of unpaid trustees, and given that news organisations will face additional risks these will need to be highly engaged and informed. This relationship can be complicated – the people who know the work best are usually already doing it, and need to be paid for it. And in small newsrooms, trustees could easily end up outnumbering staff, making for an even more unbalanced relationship.[3]

A newsroom which was a charity would have an ambiguous place status under the Lobbying Act – which clearly covers charities but has an exemption for news publishers – and could end up having a lot of additional administration around elections as well. And this is all assuming things are running smoothly and you’re not being investigated by the Charity Commission (see point 4). So the benefits of becoming a charity would need to be significant to make all this extra work worthwhile.

2. Charity status might not result in much more money

The premise of pursuing charitable status for news organisations is that this will release new funds into the sector. However, it’s not clear that the legal structure in itself would result in significant amounts of extra money. Trusts and Foundations often don’t recognise the social value of public interest news, or don’t appreciate why commercial models are now so difficult, and news organisations rarely fit their criteria.

This could change, and the CJP and others are working with donors to change these perceptions. But if this work is being done anyway, why not make the case that Trusts should fund newsrooms which aren’t charities? Charitable foundations are entitled to fund non-charities (so long as the work being funded helps fulfils the foundation’s charitable purposes) and many do. This would need to be project funding rather than core funding which can be more tricky to administer, but significantly less work than running the entire organisation as a charity.

Outside of grant funding, being a charity would have tax advantages and could claim gift aid on donations, but these benefits are unlikely to seriously change the economic viability of the organisations, especially local/community news providers [4]. Given the risks of charitable status, news organisations should make sure that changing their legal status will actually pay off financially before pursuing it.

3. Philanthropy is also a problem

Discussions in the UK often involve looking longingly at the much larger sums of philanthropic funding available to news organisations in the US. There are many reasons this can’t be replicated in the UK – there is simply far less philanthropic wealth to go round, and private giving is often relied upon the services that the state provides here.[5] In any case, if we are going to take the US as a model we need to acknowledge that philanthropy is not a silver bullet and comes with its own problems.

At the Impact Media Conference earlier this year, Daniel Ash from the Chicago Community Trust told some cautionary tales about the negative impact that philanthropy can have – including his own experience of having funding suddenly pulled from the public radio station where he worked, because a board member owned the local newspaper and didn’t want to fund a rival. Even when the influence isn’t this explicit, grant-makers have their own interests and priorities that often don’t align with what communities need, and it’s easy to get caught in chasing the money and shaping work around donors. Arguably, the whole idea of pursuing charitable status for news organisations mainly because this will suit philanthropists is an example of this dynamic.

This is not to say that newsrooms should never take philanthropic funding, but we have to recognise that philanthropy represents a different set of elite interests and needs additional safeguards to preserve independence. There are examples of how this can work, such as the Pivot Fund in the US, or the participatory grant-making processes used by Lankelly Chase for their News and Media Fund. Exploring how the process of funding media could be democratised is one current strand of the BBC and Beyond Campaign, and needs to be a central part of any discussions about expanding news publishers’ reliance on philanthropy.

4. Charitable status is used to silence civil society

The past decade has seen serious attacks on the independence, voice and influence of civil society. Legislation like the Lobbying Act, the expansion of Prevent, and the limitations on protest in this year’s Policing Act have created an atmosphere described by the UN as “the closing space for civil society in the UK”. These effects have been felt across many organisational forms but registered charities have faced particular pressures, and charitable status has been frequently weaponised to shut down dissent.

News organisations that became charities would need to be prepared to navigate this hostile context, and would need to understand that simply following ‘the rules’ is not enough to avoid censure. As I argued in a recent article for Soundings Journal, there has been a repeated pattern of charities doing something Conservative MPs or right wing newspapers don’t like, leading to complaints to the Charity Commission and an investigation being launched. While these investigations generally haven’t found significant wrongdoing, they cause a huge amount of stress and additional bureaucracy that acts as a punishment in itself, regardless of the outcome.

Barnett, Murdoch and Townend do recognise this to a degree, stating that for journalism to be charitable it will need to be “non-politically motivated”. Yet working out what this means will not be straightforward. A news organisation can of course avoid being explicitly partisan or endorsing particular parties at elections. But will they also have to avoid criticising austerity (like Oxfam), or acknowledging structural racism (like Runnymede), or talking about the colonial links to their local stately home (like the National Trust)? All these organisations have faced investigations which ate up valuable time and resources even though they were largely exonerated. Do news publishers really want to spend their time fighting with the Charity Commission, and creating paperwork to show they’ve considered all possible ‘reputational risks’, rather than focussing on the needs of their communities?

5. ‘Public benefit journalism’ may not be what communities need

Barnett et al.’s definition of ‘public benefit journalism’ – i.e. the kind of journalism that they believe could be charitable – is very useful as a legal argument. Yet the journalism they describe (as “disinterested”, “objective”, “unbiased” and “impartial”) is rooted in a traditional journalistic model that is being contested by those developing participatory, community-oriented practices.

As Shirish Kulkarni argues, the huge gulf in trust between citizens and news providers can’t be solved by continuing to produce news in the traditional ways, and requires some real innovation: the People’s Newsroom Initiative he runs, for example, aims to “move away from us as journalists being the gatekeepers to being facilitators, to enable people and communities to tell their own stories.” When people tell their own stories, of course, they are not going to be impartial or disinterested, and Kulkarni echoes approaches such as Peace Journalism and Generative Journalism in arguing that ‘objectivity’ needs to be let go of as a journalistic value.

The problem isn’t that this kind of journalism will necessarily be non-charitable – most of it is quite likely to fit within the formal framework for charitability. The problem is with defining ‘public benefit journalism’ using terms like ‘objective’ and ‘impartial’, and then allowing the Charity Commission to determine what they mean. We have seen how this can be weaponised within the BBC e.g. with the attempt to block the appointment of Jess Brammar as executive news editor because she had tweeted ‘Black Lives Matter’ and therefore wasn’t sufficiently ‘impartial’. The chances that these terms would be used to constrain news organisations who registered as charities seems very high, given that this is already how partisan interpretations of ‘political activity’ are weaponised against the charity sector. [6] And more fundamentally, charity status creates lines of accountability upwards towards trustees and the Charity Commission, which may be at odds with being truly accountable downwards to communities.

Conclusion

Charitable status might be the right route for some news organisations, and some level of philanthropic support will probably need to be part of the funding mix of the future. But decisions about the legal structures news publishers adopt need to be taken with their eyes open to the potential pitfalls, and an awareness that charity status might lead to significant changes in what they do and how they do it, even if that is not their intention.

All too often, conversations about ‘risk’ in the charity sector are focused on negative media coverage, or scrutiny from the Charity Commission – when the biggest risk is often that being risk averse will make the work ineffective and unable to meet the needs of communities. For news organisations these risks are likely to be significant, and substantial safeguards will be needed to mitigate them. The benefits will need to be substantial to make this worthwhile.

[1] It has in fact already been established that community newsrooms can become charities in Scotland. However, the overall context for civil society is quite different in Scotland, including that the Scottish Charity Regulator has been far less punitive in recent years than the Charity Commission of England and Wales.

[2] Besides my own activism and organising, I worked on the Civil Society Futures Inquiry and then ran an offshoot research project on the restrictions on political activity in small civil society organisations. I am also a member of the grassroots funder Edge Fund, and ran a consultation for JRCT on establishing a fund to support grassroots movements which will be launching shortly.

[3] The Charity Commission recommend 5-12 trustees. The PINF Index 2022 found that the median number of employees at independent news publishers was 2 or 3 full-time equivalent staff, made up of 8 individuals i.e. many working very part-time.

[4] Some news publishers have created successful donor-supported models but these tend to be nationally focussed, e.g. the Canary, Novara Media (neither of whom would pursue being a charity). The Bristol Cable, on the other hand, only receives a third of its income from member subscriptions – and while they aim to increase this as things stand gift aid wouldn’t make a huge difference to the business model.

[5] News deserts in the US are also on a scale unimaginable here, given that everyone has at least some local and regional coverage on the BBC.

[6] There is a longer piece to be written exploring the similarities between the partisan definitions of ‘political activity’ being used to stifle dissent in the charity sector, and the partisan definitions of ‘impartiality’ which have been weaponised to control broadcasters like the BBC. But to highlight one glaring similarity, the people considered objective and neutral enough to be in charge of defining each of these terms – the chair of the Charity Commission and the Chair of Ofcom – were both appointed to the House of Lords as Conservative peers. (Technically, the Chair of Ofcom now sits as a crossbench peer.)