Shortly after the UK’s decision to leave the European Union, we published our first Brexit briefing (pdf, 974kb), in which we highlighted the potential political, financial, regulatory and social implications of Brexit for the voluntary sector.
Now, four months later, it’s time to take another look at the current state of affairs. Today we published our second Brexit briefing, which is the result of the work we’ve carried out since the EU referendum.
- We’ve closely monitored developments in government and met with ministers in the newly created Department for Exiting the EU (DExEU) and DCMS to discuss how the voluntary sector can feed into the negotiations.
- We’ve been holding Brexit-related events and engaged with our members and the wider sector to learn how charities will be affected in the short and long term.
What has changed since the last briefing?
Until the exact arrangements for exiting the EU have been agreed, it’s still difficult to assess the impact of Brexit on the charity sector. Nevertheless, there have been important developments in the political environment that will give the negotiations a sense of direction.
Hard Brexit v. soft Brexit
The government has announced that it will trigger article 50 by the end of March 2017, although this could also happen as early as January. While Theresa May has repeatedly said that ‘Brexit means Brexit’, the government has so far held back details on what it is aiming to achieve . It seems less and less likely however that we will have a ‘soft Brexit’, which would ensure the UK’s continued access to the single market.
Since we published our last briefing, the government has created the Department for Exiting the EU (DExEU) and key roles on both sides of the negotiating table have been appointed.
The new department is responsible for co-ordinating the work that goes into the negotiations and the withdrawal process, and engages with other departments and different stakeholders to do so. Leave campaigners David Davis, who is the new Secretary of State for Exiting the EU, Boris Johnson and Liam Fox will be among the key players in the withdrawal process.
Comments from key figures on the EU side suggest that the EU will take a firm stand in the negotiations, with Guy Verhofstadt, lead negotiator for the European Parliament, emphasising the link between a country’s access to the single market and its willingness to accept freedom of movement.
What does this mean for charities?
Our new briefing provides more detail about the different ways in which charities and their work may be affected by Brexit.
For example, we’ve taken a look at some cross-cutting issues around employment law and free movement of people, data protection legislation, Value Added Tax (VAT) and procurement rules.
The expected impact on these areas varies significantly. On the one hand, UK procurement legislation mostly arises from EU directives which have been implemented into UK law and will therefore continue to apply.
The future of charity staff from the EU, on the other hand, is much more uncertain. Health and social care organisations and universities would expect to see major impacts if immigration rules for EU nationals were tightened.
Some charities also have specific concerns relating to their area of work. The environment, refugee and asylum rights, and women’s rights and domestic abuse are all areas that are heavily regulated by the EU, so the dismantling of EU legislation could jeopardise important legal protections for these charities’ causes and beneficiaries.
One of the immediate concerns expressed by many charity leaders was about major income streams from the EU drying up.
In August, the Treasury gave some reassurances by pledging to fund EU programmes in the UK until 2020.
This however does not solve the issue of how services and activities funded by the EU are going to be funded and maintained post-Brexit. NCVO and other umbrella bodies wrote to the chief secretary to the Treasury, David Gauke, to ask for further clarity.
The debate ahead of the EU referendum was in large part shaped by the debate over immigration levels, but since the result there has been further analysis about the wider social and cultural issue behind the vote.
The findings highlight how our sector has an important role to play in rebuilding communities and reaching out to the disengaged, while continuing to stand by our values of diversity, fairness and inclusion.
What can you do?
If you wish to represent your cause and beneficiaries in the negotiations, it will be useful to build a strong evidence base and engage with other charities, government departments and international partners.
NCVO will continue to champion and represent the voluntary sector throughout the process, so do feed in any intelligence about how Brexit might affect your organisation or cause by emailing Daniela Wulf.
Download the full briefing (pdf, 766KB)