Charity Finance Group respond to budget announcement

19th March 2014

Caron Bradshaw, CEO of Charity Finance Group, said:

“The Chancellor spoke confidently about an improving economy but he was clear that we can expect no let-up in spending cuts.  Tough controls on welfare and public sector expenditure are here to stay.  This is very worrying for those charities that rely on public funding or who work with welfare recipients.  Anyone in the sector who thought the age of doing more with less was over, or who was hoping for a break for vulnerable beneficiaries, should think again.

  • Support for part of the charity sector

But it’s not all bad news across civil society.  There were some giveaways for parts of our sector.  Air ambulance and inland safety boat charities will have been thrilled at the waiving of VAT on fuel, much improving their running costs.

It was great to hear positive announcements for culture and measures which might assist charities who are custodians of our historic buildings, Scout and Guide groups and military and emergency charities.  We will be looking at the detail very closely.

  • Social investment tax relief

There was also good news for our social economy with social investment tax relief being set at 30%.  CFG hopes that this will prove to be high enough to be attractive but not so high that it damages Gift Aid. We want to see it make a valuable contribution and only time will tell if our cautious welcome is justified!

  • Gift Aid

Whilst the speech made no reference to Gift Aid or measures to improve the functioning of this much-loved scheme, the background papers did.  We welcome commitment to improve digital giving, the use of intermediaries and an announcement of an out-reach programme to drive up small charity use of the Gift Aid Small Donations Scheme.  

  • Tax avoidance

The budget documents allude to the current consultation on measures to deter the use of charities established for the purpose of tax avoidance.  Whilst we fully support the Government’s objective to reduce tax avoidance and prevent charities being exploited for such purposes, we have concerns about the proposals set out and are unsure whether the legislative route is the right way forward. We have put these views to HMRC already and will be engaging in the consultation.

“This was clearly a budget written with next year’s election in mind: measures to woo older potential voters, tempting titbits for savers and a radical shake-up of Defined Contribution Pensions which will resonate across the charity sector which employs 750,000 people.”

 

ENDS

Notes for editor:

1. Charity Finance Group’s vision is to inspire the development of a charity sector that is  financially confident, dynamic and trustworthy. CFG works with finance managers to enable them to give the essential leadership on finance strategy and management that their charities need; promoting best practice in charity finance, driving up standards, campaigning for a better operating environment and ensuring every pound given to charity works harder. CFG has more than 2,200 members, and collectively our members are responsible for the management of over £19bn in charitable funds.  

2. CFG pre- budget submission can be found here

3. For more information please contact policy@cfg.org.uk

 

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