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Charitable status secret is out

The education and Lifelong Learning Secretary has finally confirmed that further education colleges are to be exempt from the charities legislation, one of the worst-kept secrets in the sector.

Fiona Hyslop announced at the weekend that colleges would retain their charitable status, ending fears that they might otherwise have lost rates and tax relief estimated to be worth up to pound;25 million a year.

Ms Hyslop said she would seek the comments of the parliamentary education and justice committees before taking action to get round the charities legislation which stipulates that charities must be independent of government.

The Office of the Scottish Charity Regulator ruled last year that John Wheatley College in Glasgow could not operate as a charity because of the ministerial powers to which it was subject. The regulator did accept that the college had exclusively charitable purposes and provided substantial benefit.

An alternative option for Ms Hyslop would have been to remove her power to intervene in colleges. But this would have prevented ministers' right to act where they believed a college was being mismanaged, and it was opposed by the unions.

The Association of Scotland's Colleges has been calling for colleges to be exempt from the charities legislation, which would bring them into line with those in England and with bodies such as the National Galleries of Scotland, the National Museums of Scotland, the National Library of Scotland and the Royal Commission on the Ancient and Historical Monuments of Scotland.

Ms Hyslop said colleges needed the benefits of charitable status to continue making their "huge contribution" to students, communities and the economy. "That is why I wish to act to prevent them being stripped of their charitable status with the financial consequences that would follow," she said. "I hope this security strengthens our colleges, so that they can get on with the important business of education."

The ASC called the retention of tax and rates relief "a huge relief".

The Government intends to help post-1992 universities to retain their charitable status, which was under threat because of ministers' powers to close them. Ms Hyslop said they would solve that problem by making any closure subject to the agreement of the governing body.

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