Charities condemn 'damaging' reform
The National Council for Voluntary Organisations (NCVO) said it remained firmly opposed to reforms it believes will prevent charities from speaking out on matters of public interest.
It was invited to talks earlier with Commons Leader Andrew Lansley and constitutional reform minister Chloe Smith to discuss the concerns - which are shared by other bodies.
Oxfam, the Royal British Legion, and the Salvation Army are among key organisations that fear the coalition bill is so complex and unclear that it is likely to be "impossible" to follow.
Downing Street rejected warnings that new legislation on lobbying will prevent charities from speaking out on matters of public interest.
Only the small number of charities which explicitly promote particular parties or candidates will be caught by the provisions of the Transparency of Lobbying, non-Party Campaigning, and Trade Union Administration Bill, said Prime Minister David Cameron's official spokesman.
But while welcoming the talks, NCVO director of public policy Karl Wilding said its concerns remained.
"We continue to be of the same opinion that we held before going in," he said.
"We are clear that this Bill is damaging. It would be fair to say that the Leader of the House and the minister continue to have a different interpretation.
"I am not still entirely clear what they are trying to achieve. What we have at the moment is not perfect but it can be made to work better."
It was important to have an electoral system that voters trusted, he said, and charities and voluntary bodies had responsibilities, especially during election campaigns.
But the legislation was "all stick and no carrot", he said.
In the legal opinion submitted to the Cabinet Office, Helen Mountfield QC concluded: " Uncertainty about what the law requires is likely to have a chilling effect on freedom of expression, putting small organisations and their trustees and directors in fear of criminal penalty if they speak out on matters of public interest and concern.
"The restrictions and restraints are so wide and so burdensome as arguably to amount to a disproportionate restraint on freedom of expression."
The PM's spokesman told a Westminster media briefing: "Of course we always listen to concerns. However, my understanding is that - provided the charities are not promoting the electoral success or otherwise enhancing the standing of a particular party or political candidate - they will not be affected by this legislation.
"My understanding is that at the 2010 general election, very few charities were registered as third parties. That is why we are saying that, provided charities continue to campaign as the vast majority of them always have they won't be affected."
The Government's proposals, which will be debated by MPs for the first time tomorrow, would introduce a statutory register of lobbyists to identify whose interests were being represented by consultant lobbyists and those who were paid to lobby on behalf of a third party, and set a £390,000 cap on the amount any organisation - excluding political parties - could spend across the UK during elections.
The Electoral Commission, the independent body responsible for overseeing the UK's electoral system, has raised a series of concerns about the bill warning of some ''significant issues of workability''.
Shadow leader of the House Angela Eagle said that the proposed reforms would gag charities while failing to deal with concerns about Conservative election strategist Lynton Crosby, whose lobbying company has reportedly worked for tobacco and alcohol companies.
Ms Eagle said: "David Cameron promised to fix our broken politics, but this Bill makes things worse and not better.
"This is a Bill that lets Lynton Crosby off the hook, but gags charities and campaigners from having a say. No wonder the public think David Cameron stands up for the wrong people.
"This out-of-touch Government must go back to the drawing board and come forward with proposals for genuine reform."
© 2013 Press Association