the UK’s national cyclists’ organisation.
May 2005: CTC Charitable Trust Announced
At its AGM on April 23rd 2005 CTC Council announced that part of its programme of work for all cyclists was to be taken forward by the CTC Charitable Trust, the new structure for our work which includes our campaigning, cycling development, training, volunteering and diversity activities.
CTC’s plans include cycling activities for disadvantaged communities, better access to jobs or education and physical activity schemes to help with the nation’s growing obesity problems. Therefore CTC needs to fundraise for this work as well as campaigning for safer cycling and better facilities. This is additional to its membership activities and can not be expected to come from subscriptions alone.
Some of this work has started, particularly in cycle training where CTC is becoming a national authority, and we have our 130 year record as the leading voice of cyclists. However CTC’s fundraising is not efficient in tax terms and in some cases CTC has been specifically refused grants because it is not a charity.
After taking specialist advice from voluntary sector legal advisors and fundraising consultants CTC Council concluded that the creation of a charitable trust to deliver many of the public benefit goals of the organisation would be the most effective way forward, working alongside the core membership organisation. The organisations will share mission and aims, governance, premises, staff and administration but will split into two clear areas of work.
To make this work there is a formal arrangement between CTC and the CTC Charitable Trust to cover all shared issues. After this staff with public benefit roles will start working for the charity leaving approximately 5 staff and all the main service contractors working for the membership organisation. CTC National Office is also the national office of CTC Charitable Trust, and as the principle employer and main user of the building, CTC donated the building to the new charity.
CTC will support the work of the charitable trust by donations from its membership income; otherwise the Trust will start an extensive fundraising programme working alongside CTC’s marketing and trading activities.
A page of more detailed information on the CTC Charitable Trust can be found here.
The Organisational Structure of CTC
CTC is a company limited by guarantee. This means that it is a legal company, registered at Companies House (as “Cyclists’ Touring Club”), and covered by company law. Unlike most companies in the UK which are limited through the issue of shares, a company limited by guarantee only calls on its “shareholders” (known as “members”) to contribute if it ceases trading. Members are then called upon to contribute to meet the company’s debts up to the limit set out in its constitution. All CTC members are “members” of the CTC company. This means that all members are legally entitled to receive the Annual Report and Accounts (which is why they are included in the magazine), to attend and vote at the Annual General Meeting, and to contribute up to ten shillings if CTC ceases trading and cannot meet its debts.
CTC has also set up a number of trading subsidiaries. The two main subsidiaries are Cyclists’ Touring Club (Central) Limited and CTC Cycling Holidays and Tours Limited. Cyclists’ Touring Club (Central) Limited runs CTC’s events such as the Challenge Rides and CTC Cycling Holidays and Tours was set up to run CTC Tours as a properly bonded tour operator. There are two further subsidiary companies, Cyclists’ Touring Club (Sales) Limited and CTC Cycle Racing Limited. Both of these companies are “dormant”, which means they are not trading. All of these companies are limited liability companies with the whole share capital owned by CTC.
There are four further subsidiary companies, again limited liability companies with the whole share capital owned by CTC. They are Cyclists’ Touring Club (Eastern) Limited; Cyclists’ Touring Club (Northern) Limited; Cyclists’ Touring Club (Southern) Limited; and Cyclists’ Touring Club (Western) Limited. These four companies are “holding” companies for the CTC Member Groups and Regions. Having the Member Groups within these companies means that the they have the protection of limited liability, but are not constrained by some of the legal requirements that applies to CTC such as VAT. Because Member Groups operate very differently to the other companies in the CTC “group”, the accounts of the Member Group companies are consolidated (grouped together) separately in CTC’s accounts.
Some years ago, CTC established the Cyclists Defence Fund in response to the Darren Coombs case. The aim of the fund is to enable CTC to fight legal cases which may adversely affect all cyclists but which may not involve CTC members who are already covered under the CTC Legal Advice scheme. It was decided that it would be better to make the Cyclists Defence Fund a separate company so that it could be registered as a charity. This has now been done. The Cyclists Defence Fund is a company limited by guarantee like CTC, but the sole member of The Cyclists Defence Fund is CTC.
As a charity, the trustees are obliged to act only in the best interests of the charity, and cannot be directly instructed to do otherwise. This means that although it is the sole owner of the company, CTC cannot instruct The Cyclists Defence Fund to take on a specific case, for example. Only the trustees can decide what the charity does. However, under company law, the sole membership does imply “control” in that CTC could appoint different trustees. This “control” requires the accounts of The Cyclists Defence Fund to be consolidated into the accounts of CTC along with its other subsidiaries.
CTC has also now set up its charitable arm, CTC Charitable Trust described above. Like The Cyclists Defence Fund, CTC Charitable Trust is a company limited by guarantee with CTC the sole member.
The following diagram shows the structure of the CTC group of companies.
