St Pauls Steiner School, London – findings of a Charity Commission Inquiry

St Pauls Steiner School was subject to a formal Charity Commission Inquiry in 2003. For reasons explained later you won’t be able to find it online at the Charity Commission’s archive of concluded inquiries so here it is:

St Pauls Steiner Project

Registered Charity Number 1037313


Introduction

1. This report is a statement of the results of an Inquiry under section 8 of the Charities Act 1993.

2. St Pauls Steiner Project (“the Charity”) was incorporated and registered in 1994. The Charity’s objects are to promote and provide for the advancement of education of the public in the teachings of the late Dr Rudolf Steiner and in connection therewith to conduct in the United Kingdom any boarding or day school or schools for the education of children and in so far as is consistent with the running of such school and its charitable purposes to make the use of the premises available as an educational resource to the community.

3. The Charity’s area of benefit is the United Kingdom; however, its main activity is running a Steiner school in North London. Its income for 2000 was in the region of £47,000.

4. Another charity, St Paul’s Steiner Project Two (“SPSP2”), collects the fees payable for attendance at the Steiner school. SPSP2’s objects are very similar to the objects of the Charity. It is the practice of SPSP2 to apply its funds for the purposes of the Charity. Its income for 2000 was in the region of £202,000.

5. The trustees of the Charity are also the trustees of SPSP2.

Issues

6. In November 2002, concerns were raised with the Charity Commission about the trustees’ administration and management of the Charity. It was alleged that there had been misapplications of the Charity’s funds and concerns were raised about the condition of the Grade II listed former Church building on the Charity’s premises.

7. During the evaluation process, it was found that Islington Council’s Planning Department, English Heritage and the landlord, the Church Commissioners, had concerns about the condition of the building. Islington Council also had concerns about the actions of a Charity employee.

8. On 9 January 2003, the Commission opened an Inquiry with the aims of: –

§                  investigating the allegations of mismanagement and misapplication of funds;

§                  clarifying the concerns of Islington Council and English Heritage;

§                  establishing the extent of the Church Commissioners’ concerns; and,

§                  determining whether the trustees had failed in their responsibilities regarding maintenance under the lease of the Charity’s premises.

Findings

9. The trustees resigned shortly after the Inquiry opened and new trustees for both charities were co-opted. The Commission considered that the processes that were followed were acceptable.

10. The former trustees acknowledged that a number of trustee duties had been inappropriately delegated to one employee who appeared to have considerable control over the Charity and decision making.

11. The former trustees were aware that they had received only temporary planning permission for some of the works which had been carried out to the interior of the Charity’s premises; however, they had not acted to prevent planning offences.

12. The former trustees had been negligent in their duty to ensure that the Charity was complying with all aspects of its lease from the Church Commissioners.

13. The new trustees accepted the Charity was carrying out inappropriate trading by running a shop and café. Charitable funds had been misapplied in establishing these activities.

14. The new trustees brought to the Commission’s attention two transfers of funds from the SPSP2’s bank account that they considered to be unauthorised.

Outcomes

15. The former trustees are now fully aware that they acted inappropriately by allowing an employee to take many decisions which should properly have been made by the trustees.

16. The former trustees agreed that they had not acted in accordance with planning regulations and that they had been at fault in not complying with the terms and conditions of the lease for the premises.

17. The employee in question has resigned from the Charity.

18. The newly co-opted trustees have prepared plans for how they intend to take the charity forward. They intend to work closely with Islington Council, English Heritage and the Church Commissioners to ensure compliance with the terms of the lease. The Charity Commission decided not to pursue the recovery of funds expended on irregular building works, as the amount was considered to be minimal.

19. The Charity has now employed a conservation architect.

20. The new trustees have decided to close down the trading activities. No further action has been taken to recover funds used to establish the trading activities, as equipment purchased for these purposes can be utilised by the Charity.

21. The Inquiry closed on 12 May 2003.

22. Subsequent correspondence showed that, during the period of ‘handover’ from one trustee body to another, there was a lack of clarity regarding the extent of employees’ delegated authority in respect of transfers of funds. The new trustees are ensuring there are detailed written procedures on this area.

23. The Commission will monitor the situation in January 2004.

Wider Lessons

24. Owing to the scale or nature of a charity, trustees might, of necessity, have to delegate to employees decisions on day-to-day management matters. In these circumstances, the scope of the delegated authority must be clearly laid down in writing and instructions given for decisions on important matters to be reported to the trustees. The trustees remain legally responsible and must supervise and control the work of the officers.

25. Trustees should be aware that they may apply their charity’s assets only to further its stated purposes and not for any other purposes, whether charitable or otherwise. If there is evidence that trustees have deliberately or recklessly used charity assets for inappropriate purposes, the Commission will consider taking steps to obtain restitution from them personally.

26. Trustees have a duty to ensure that the charity operates lawfully. It is important that trustees identify and comply with current legislation and that, if they are in any doubt, they take appropriate professional advice.

As you can see, the charity had been misapplying funds, breached the terms of its lease and falling foul of planning requirements. The school accounts for year 2004 subsequent to these events recorded the mismanagement of funds as a ‘misappropriation’. All in all, this can only be considered to have been a situation of mismanagement on a massive scale.

St Pauls Steiner School is a member of the Steiner Waldorf Schools Fellowship (SWSF), the national organisation representing Steiner education (i.e. Anthroposophical education) here in UK. SWSF’s lobbyist for state funding of Steiner education, Sylvi Sklan, was part of the small group of people bussed in to replace the existing school trustees and clear up the mess at St Pauls. The school’s application for state funding in 2007 was, surprise surprise, turned down. There’s another story here but it has more to do with how state funding of Anthroposophical education began here in England. Meanwhile, readers with concerns about Steiner belief should take note that the Anthroposophy movement is making good progress in seeing state funding of Anthroposophical education begin in Scotland. They had a gig in the Scottish Parliament just yesterday, obviously welcome there then.

Back to that Charity Commission Inquiry. The results of the Inquiry had been available on the Charity Commission’s website until 2005. At about this time the Commission launched a new method of making Inquiry findings available to the public. All previously published Inquiries were archived but unavailable online so I requested and obtained a copy of the archive. However, the version I received is incomplete.

Prior to the 2005 method of publishing Charity Commission Inquiry findings I did know of the St Pauls Inquiry and of the existence of at least half a dozen other formal Inquiries into English and Welsh Anthroposophical charities. None of these known Inquiries were in the version of the pre-2005 archive sent to me. I did retrieve all but one of the ‘lost’ Inquiries but had to resort to Freedom of Information legislation to obtain the information I knew to exist, once was and should still be in the public domain. I’ll be attempting to obtain the missing Inquiry and post news of it here as and when available – if it’s the one I’m aware of it involves financial shenanigans at a level over and above that of the ‘misappropriation of funds’ St Pauls Steiner school mentions in its annual accounts.

Meanwhile, be aware that if you search the Charity Commission website looking for Inquiries then the results will miss some previously published reports. Even if you knew an Inquiry into a charity had taken place you might not find it by searching the Commission’s website.

UPDATE February 2019: FYI The Supreme Court has ruled that the Charity Commission does not have to disclose information relating to concluded inquiries.