Charity Finance Group: reaction to Budget 2013

20th March 2013

Charity Finance Group (CFG) welcomes the announcement of the new Employment Allowance, the planned consultation on digital giving and the announcement of a social investment tax relief.

Making it easier to employ staff and direct resources to the front line

Caron Bradshaw, CEO of CFG said "In terms of making a practical difference to the bottom line of thousands of charities, the Employment Allowance is the headline news and welcome surprise for the sector in Budget 2013. This could make a difference of £45m to up to 35,000 charities. With most charities being small employers, this will make a tangible and real difference, allowing charities to direct more to their cause, at a time when costs are rising across the board."

Modernising Gift Aid

CFG welcomes proposals to improve Gift Aid for digital giving. The latest report in the Managing in a Downturn series, produced by CFG, IoF and PwC, revealed a staggering 9 out of 10 charities are finding fundraising much harder. CFG asked in their Budget submission for the Government to look into allowing enduring declarations for some digital giving platforms and is delighted that the Government is moving forward with this progressive idea.

Caron Bradshaw, CEO at CFG said: “Efforts to increase the range of options for giving through Gift Aid will help charities to explore the exciting technological innovations likely to become increasingly important. This is a really promising move as far as we’re concerned.

However, the environment is tough for a number of reasons. We have to help people to feel that they can afford to give and as well as Gift Aid, measures in this Budget that aim to decrease cost of living and relieve some of the pressure on individual and household incomes are to be welcomed. This will all help us to work together to build our giving culture.”

Social investment

CFG welcomes the Chancellor’s announcement on a social investment tax relief. Caron Bradshaw, said: “It’s fantastic to see moves from Government to develop the framework to incentivise and further build this market. However, while social investment will benefit some, it is no panacea for charities generally. Our recent report showed that 73% had not considered using social investment.”

The pension issue

A new duty on the Pensions Regulator to support scheme funding arrangements that are compatible with sustainable growth for the sponsoring employer was also recommended by CFG. This will hopefully be a useful lever to achieve more flexible pension arrangements for charities, particularly those in multi-employer pension schemes. It provides a useful step towards tackling issues around multi-employer defined benefit schemes, however the challenge of finding a lasting solution remains.

Demand will continue to be on the up

CFG also warned that the sector is facing unprecedented demand in an age of austerity and public spending cuts; Caron said: “All evidence points to increasing demand. Pressure to cut the welfare budget and further reign-in of Whitehall spending will undoubtedly have a knock on effect at a national and local level. The Government has to recognise the impact of spending decisions on the sector if we are to meet demand – someone always has to pick up the slack.”

- Ends -

Notes to Editors:

1. CFG is the charity that champions best practice in finance management in the voluntary sector. Our training and development programmes enable finance managers to give the essential leadership on finance strategy and management that their charities need. With more than 2000 members, managing over £19bn, we are uniquely placed to challenge regulation which threatens the effective use of charity funds. For more information, please see  

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