The Small Charitable Donations and Childcare Payments Bill has just finished Committee Stage in the House of Commons. As Kim covered in her recent post, we think the bill could go a lot further, and this blog post explains how we’ve been working to improve it to ensure the greatest number of charities and donations are able to benefit from the scheme.
Following our consultation response, we’ve continued to work jointly with others in the sector to brief MPs (PDF, 315KB) on the issues around the bill, and supported amendments that will mean the scheme helps more charities.
The matching requirement
The matching requirement means charities must claim £1 of normal gift-aided donations to claim £10 under the scheme. We think that changing this aspect of the scheme has the biggest potential to widen access to it, and have focused a lot of our work on changing it. We’ve been really pleased to see so many MPs from across the House of Commons raising it as an issue.
The changes in the bill as it currently stands are expected by government to help around 7,500 organisations. We know that every year, the number of charities that are unable to fully benefit from the scheme because they claim under the current matching requirement limit of £800 is somewhere between 6,000 to 19,000 organisations. That’s obviously a large range, but even if the precise number is at the lower end of this scale, the reform or removal of the matching requirement would help at least as many charities as the bill already sets out to assist.
Looking beyond cash
The bill proposes extending the types of donations eligible for the scheme to contactless payments, which will help future-proof the scheme as the technology is used more in places like street collections. However, during our call for evidence from charities, we heard that cheques remained a popular way of giving and that organisations could benefit if they were included in the scheme. We’ve been supporting a range of amendments that would see the scheme simplified by widening the types of donations that can be claimed under the Gift Aid Small Donations Scheme to include cheques and other forms of payment.
Fixing the glitches
The scheme includes a ‘connected charities’ rule, that tries to ensure that subsidiaries of charities can’t claim a second time under a separate cap of £2,000 – they only get the one bite at the cherry. But because of the technicalities of the rules, a number of organisations (like some scouts and cadet groups) that have similar charitable purposes but are effectively independent in terms of their governance and finances are caught by the rule, and grouped together under a single £2,000 cap. We’ve been supporting amendments that recognise the unusual position of such organisations and would enable each of them to claim separately, which the government has now committed to reviewing.
The bill has a way to go before it receives royal assent, and we’re going to continue pushing on these points as it moves into the House of Lords. Keep an eye on the blog for updates as the bill progresses.