LORD HARRIES of Pentregarth, a former Bishop of Oxford, has criticised new rules that would forbid charities that receive government grants from using that money to lobby MPs, the Government, or political parties.

From May, the new condition will be attached to all money handed out to charities by central-government departments.

Lord Harries, who chairs the Commission on Civil Society and Democratic Engagement, told the BBC that making a distinction between the direct work of charities in helping people and their attempts to influence government policy was “very, very unhelpful”.

Charities that worked on the “front line” were often best placed to identify changes that could be made to benefit people’s lives. “Surely they are morally bound to tell the Government they could improve their work to help, say, children in poverty?” Lord Harries said.

The new rules were defended by the Cabinet Office minister Matthew Hancock as a “common-sense” change to prevent taxpayers’ money being “wasted” on political campaigning and lobbying. The Cabinet Office said that last year the Government gave the voluntary sector £10 billion.

The chief executive of the National Council for Voluntary Organisations, Sir Stuart Etherington, described the “insane” and “draconian” changes as “tantamount to making charities take a vow of silence”.

On Thursday, Sir Stuart and 142 other charity chief executives wrote an open letter to the Prime Minister to ask him to reverse the policy. 

"Organisations funded by government have helped to reform and improve public services. They have held providers to account and brought to public attention failures that might otherwise have gone unnoticed. Much of this work can and does save taxpayers money."

The letter warns that work in areas such as combating extremism or limiting female genital mutilation could be set back significantly if charities were unable to feed back to ministers what they are learning. 

It concludes: "We believe that a strong, effective working relationship between voluntary organisations and the state, based upon mutual respect and understanding, is beneficial to the people of this country and beyond."