Backing Britain’s Charities in Parliament

Blog post by Steve Clapperton, Campaigns Manager at CAF

Following the significant media coverage of the Back Britain’s Charities campaign earlier in the week, the joint CAF (Charities Aid Foundation) and NCVO (National Council for Voluntary Organisations) campaign made it to Parliament on Wednesday 12^th December, with statistics and briefings used by the campaign forming the basis of much of the day’s debate in the House of Lords.

The UK Giving 2012 report, a key part of the Back Britain’s Charities campaign, found itself the subject of Parliamentary scrutiny, as Baroness Pitkeathley used House of Lords question time to press the Government on their support for the charitable sector, and urged the Government to take action to encourage giving.

Baroness Pitkeathley raised statistics from CAF’s survey of senior charity workers published this weekend, and argued that the threat facing charities raised questions about the Government’s vision for the voluntary sector. In response for the Government, Lord Wallace of Saltaire told the House that he had looked at the research in “some detail,” and that he found the contents to be “worrying.”

Baroness Barker then asked the Government to reform Gift Aid – one of the 5 asks of the Back Britain’s Charities campaign – pointing out that a universal declaration of gift aid would make online giving much more beneficial to charities than it is now. Lord Wallace of Saltaire, speaking for the Government, told the House that “I strongly agree with the noble Baroness.”

Both responses from the Government show that they are aware of the research underpinning the campaign, and that decision makers at the highest level are aware of the pressures on them to act to support charities.

That wasn’t the end of the campaign’s Parliamentary activity for the day. A later debate in the House of Lords on the role of the voluntary sector in providing public services was dominated by references to the data published on Sunday, showing that the media coverage received over the weekend hit home with Parliamentarians.

In the chamber former Chief Secretary to the Treasury Lord Boateng highlighted the problems facing charities as detailed in the 2012 UK Giving Report, telling Peers that the financial situation many charities find themselves in “undoubtedly reflects the period of austerity and the challenging economic times in which we live.” Lord Boateng went on to directly reference the senior charity workers survey, using the figures to draw attention to the turbulent economic climate facing the third sector.

As the campaign has demonstrated, many charities are being hit with a triple whammy; donations are down, central and local government are making cuts, and the demand for the services charities provide is increasing. This dilemma was eloquently explained by Lord Adebowale, who told the chamber that “not-for-profit organisations are having to think long and hard about how they can remain sustainable […] while maintaining the quality of services and support that they can provide to the people that need it.”

It is clear from the tone and content of the debates that there is a growing awareness of the challenges facing charities, and that many Members of the House of Lords are determined to support the third sector.

We need to capitalise on this momentum to ensure that the threat facing charities remains at the forefront of political debate in the New Year – and we need your help.

Sign up to the campaign here, and find out what you can do to Back Britain’s Charities.

Giving it large: million pound donors

Blog post by Rhodri Davies, Policy Manager at CAF

The Annual Coutts Million Pound Donors report, compiled by Dr Beth Breeze of the University of Kent, was released today. The headline finding is that there has been an increase in the number of donations of £1 million pounds or more, but the overall value of these “million pound donations” is down, from £1.3bn in the 2011 report to £1.2bn this year. The number of different donors giving such donations has also risen: 130 separate “million pound donors” were identified in this year’s report, a marked increase on the 73 identified last year.

The analysis of these figures suggests there are reasons to be both encouraged and concerned: there are more million pound donors, but they are giving less on average than was the case in the past. The cause for concern is that at the same time as regular charitable donations are down (as shown by this year’s UK Giving), the mega-donations that in many years drag up the overall total are down as well. This goes to show what a difficult situation charities are facing at the moment in terms of fundraising, both from the general public and from the super-rich. The encouraging thing, with an eye on the longer term, is that there appear to be more people who have ‘caught the philanthropy bug’, and the hope is that they will continue this generosity through to better economic times when the amounts they are able to give will hopefully rise.

There are a couple of things it is worth noting about this report. The first is that the total value of million pound donations includes not just donations from individuals, but donations from corporates and ‘professional foundations’ (those which are no longer controlled by the settlor or their family). It is important to bear this in mind when relating the figures to those in UK Giving, as the figures in the latter relate solely to individual charitable donations.

The other thing that is worth taking into account is the huge difference in the profile of causes that million pound donations go to, compared to mainstream donations. The top three causes identified in the Million Pound Donor report (excluding foundations) were higher education, arts & culture and international development. By contrast, the three most popular charitable causes identified by UK Giving were medical research, hospital and children. This suggests that even if million pound donations had remained flat this year, this would more than likely not have benefited most of the charities bearing the brunt of the 20 per cent real terms drop in donations reported in UK Giving, as they are not the sort of causes favoured by major philanthropists.

I thought a couple of other aspects of the report were interesting, although not necessarily relevant to the wider question of the drop in charitable giving. The first is that the majority of million pound donations made this year were given directly to front-line charities, rather than being put into foundations for future distribution. I would be interested to know what lies behind this trend. Perhaps donors recognise the need to get money straight out to beneficiaries in the current climate; perhaps there are many new million pound donors who want to put their money in a ‘a safe pair of hands’ for their first gift of this size; or perhaps it suggests more donors taking a ‘selfless’ approach to philanthropy (in the same way as Warren Buffett when he decided to hand over his philanthropic money to the Gates Foundation to distribute for him).

The other interesting question is what explains the sharp rise in number of million pound donations. The report has always existed with the caveat that it can only capture million pound donations that are identifiable from publicly available sources of information (charity financial reports, media stories etc), so it has never pretended that it was representing all of the £1m+ donations made in a year. The question, then, is: has the number of million pound donations actually increased, or is it just that there is a greater number of identifiable million pound donations? Whichever is the case, there are positives: if it is the former, then there is more money coming into charities,which is clearly good. If it is the latter, then it may suggest that wealthy people are becoming more open about their giving, or that the media are giving more coverage to philanthropy. Both of these would be positive if they strengthened a social norm around charitable giving in the longer term.

The Million Pound Donors report is always worth reading in its own right. However, this year it is particularly interesting because of its relevance to the findings in UK Giving, and the additional insight it gives into what is happening to charitable giving in the UK at the moment. The bottom line is that the situation is tough for many charities, which is why we need wealthy philanthropists, mainstream donors, companies and the Government to come together to Back Britain’s Charities.

Small donations bill – clears final hurdle in House of Commons

Blog post by Charlotte Ravenscroft, Policy Manager at NCVO

Last night, the Small Donations Bill passed its final reading in the House of Commons. Thanks to everyone who has backed this campaign, we were able to secure Government amendments that will make the scheme significantly more accessible to charities. At least 16,000 charities will be better off as a result of these amendments. See our joint press release on the NCVO website for more details.

While not all of our concerns have been addressed, we are glad that the Government has listened to voices from across the sector and responded. As the Scheme gets up and running, we will continue to apply pressure to ensure it reaches as many charities as possible.

Small donations bill – update

Blog post by Karl Wilding, Head of Policy, Research and Foresight at NCVO

It’s good news from the government this morning as we find out what changes they will make to the Small Charitable Donations Bill following our campaigning. The bill sets up a scheme which will allow charities to claim gift aid-style payments on cash donations in collecting tins without the need to get gift aid declarations from donors. As Charlotte set out there were a number of problems with the bill that meant small charities in particular would have struggled to benefit from the scheme.

Under the original proposals, charities would only have been able to claim two times as much small donations aid as they did traditional gift aid. Now the government is proposing that charities be able to claim up to ten times as much small donations aid as they do traditional gift aid. While we’d still like to see the limit on the amount of small donations aid based on how much gift aid is claimed scrapped entirely, this is a significant improvement to the bill and should mean small charities can benefit to a much greater extent.

The government has also listened to us on eligibility for the scheme. Rather than needing a track record of making a gift aid claim for three years before they were able to make a small donations aid claim, charities will now only need to have made a gift aid claim for two years before they are eligible to claim small donations aid. Again, we would rather there were no such requirement, but this is a move in the right direction.

The government has also made provision for the restrictions in the scheme to be altered without the need for further legislation. We hope that once this scheme is established and shown to be working well the restrictions can be further relaxed.

These are very helpful changes to the bill, but they don’t go as far as we would like. It’s very important that the small donations scheme is as simple as possible for even the smallest charities to use. In particular there are some really knotty rules about ‘community buildings’ which most people we speak to simply don’t understand. If you have a moment, please write to or tweet your MP to tell them how much small donations aid could mean to you and direct them to our detailed briefing on the bill. There is more information on taking action here.

Small Donations Bill: Will your charity be able to benefit?

Blog post by Charlotte Ravenscroft, Policy Manager at NCVO

The new Small Donations scheme is supposed to be good news for charities. When it was originally launched by the Chancellor, he said that it would deliver “Gift Aid on the contents of the collecting tin and the street bucket”.

In practice, the Bill does not do quite what it says on the tin. Due to restrictions in the Bill, we are concerned that fewer charities will be able to benefit from the Scheme than the Chancellor originally intended.

Given that the maximum limit per charity is £1,250 (on £5,000 of small donations), we had particularly expected that the Scheme would be of benefit to smaller charities – often those who rely most on collecting tins and street bucket collections. But as it stands, we think these are the charities that will be most likely to lose out.

We have just five days to make a difference – please read on.

So, will your charity be able to benefit from the Small Donations Scheme?

As the Bill stands, there are a number of eligibility restrictions. To use the Scheme, charities will have to:

• Be registered with HMRC for Gift Aid;
• Have a three year track-record of using Gift Aid;
• Claim at least £1 in regular Gift Aid for every £2 they seek to claim through the new Scheme (we’re referring to this as the ‘matching requirement’).

If the charity has a group structure, there are further restrictions. Local groups of a parent charity will only be able to claim if:

• They operate out of a ‘community building’;
• Donations are made during the course of their charitable activities within the building, by a group member;
• While at least 10 people are present, at least six times a year.

While NCVO and other sector bodies recognise HMRC’s priorities to prevent fraud and manage the costs of the Scheme, we feel that many of these restrictions are disproportionate. They will limit the relevance of the Scheme for many of the charities who had hoped to benefit from it.

What can you do?

There are only five days left to take action – the final reading will be in parliament on Monday 26th November.

You can make a difference by contacting your MP today, by email or twitter, and drawing these issues to their attention.

When you contact them, we would suggest that you:

• Tell them if your charity could be affected by these restrictions;
• Ask them to back amendments that will make the Scheme more accessible for charities;
• Send them this parliamentary briefing paper (PDF, 431 KB) that NCVO, CAF, IoF and CFG have published today.

You can use our list to find and contact your MP on Twitter.

Watch our campaign video today

Back Britain’s Charities from KnowHow NonProfit on Vimeo.