As part of the Civil Society Group (CSG), Charity Finance Group (CFG) and more than 80 civil society organisations have submitted a joint response to the government's Autumn Budget 2026 consultation, setting out a series of recommendations designed to strengthen communities, improve public service delivery and support economic growth across the UK.
The submission argues that civil society contributes almost £40bn to the UK economy and plays a critical role in delivering local services, supporting vulnerable communities and preventing problems from escalating. However, charities and voluntary organisations continue to face significant financial pressures, rising costs and growing demand for support.
The group is urging the Chancellor to use the Autumn Budget to put the principles of the Civil Society Covenant into practice by recognising charities as strategic partners in delivering the government's ambitions for growth and stronger communities.
The group's key recommendations include:
- Ensuring government grants, contracts and procurement processes fully recognise and fund the true cost of delivering services, including full cost recovery, multi-year funding arrangements and inflationary uplifts;
- Encouraging charitable giving and long-term philanthropy by modernising Gift Aid and protecting tax incentives that support charitable donations and legacy giving;
- Supporting place-based giving initiatives and local voluntary sector infrastructure to attract new donors and strengthen communities;
- Investing in community ownership through a long-term national strategy and increased funding for community assets;
- Helping charities adopt digital technologies and AI safely and effectively through dedicated support and investment;
- Strengthening cyber resilience across the sector through practical support, funding and improved access to cyber security expertise.
A major focus of the submission is the sustainability of charity funding. The group argues that government funding arrangements must better reflect the real costs charities face. It is calling for all government contracts and grants to include full-cost recovery and annual inflationary uplifts, helping organisations continue delivering essential services in communities across the UK.
The submission also highlights the important role philanthropy can play at a time of constrained public finances. Building on previous recommendations to government, the group calls for greater support for place-based giving schemes and action to preserve incentives that encourage charitable gifts in wills.
Alongside this, CSG has renewed its call for the modernisation of Gift Aid. The group argues that while Gift Aid remains one of the most successful charitable tax reliefs in the world, the current system remains unnecessarily complex for both donors and charities.
CSG is also urging the government to make a long-term commitment to community ownership. The submission recommends increasing investment in community assets and developing a National Community Ownership Strategy, designed to help communities acquire and manage local spaces while generating economic and social value.
Recognising the opportunities and risks presented by emerging technologies, the group is asking government to co-design a Civil Society AI Adoption and Resilience Programme and ensure charities have equal access to public digital adoption schemes that are often only available to businesses.
Richard Sagar, Head of Policy at Charity Finance Group (CFG), comments:
“Civil society is an essential partner in delivering the government's ambitions for growth, stronger public services and thriving communities. Charities contribute billions of pounds to the economy every year, attract investment into local areas and provide support to people and communities when they need it most.
“But charities are under increasing pressure. Rising costs, falling levels of giving and growing demand for services are forcing many organisations to do more with less, or close their doors for good. Without sustainable funding and the right policy environment, the sector's ability to deliver positive outcomes will be constrained.
“The recommendations set out in this submission are practical, achievable and focused on delivering long-term value. By ensuring public funding reflects the true cost of delivery, modernising Gift Aid, supporting philanthropy, investing in community ownership and helping charities embrace technology safely, the government can unlock even greater impact from civil society.
“At a time when ministers are rightly focused on getting the most from every pound of public spending, strengthening the partnership between government and civil society represents a significant opportunity to support growth, unlock additional investment and build stronger communities across the UK.”
« Back to all news