In the week that has followed the Chancellor’s charity tax u-turn, NCVO has been asked this question a few times. Was it a good campaign? Undoubtedly yes. But was it the wrong issue?
A recent article by Bernard Collier, a trustee at NAVCA, have questioned whether we have prioritised the interests of wealthy philanthropists, over those of individuals who have been hardest hit by public spending cuts. We’ve also heard debates about “hypothecation”: whether tax reliefs enable wealthy individuals to choose where their taxes go, in a way that you and I can’t.
These questions are valid and certainly merit further discussion. They go to the heart of what the sector should stand for, but also what makes campaigns effective.
Give It Back George was an unusual campaign for NCVO in some respects. It snowballed overnight, a gathering response to an unwelcome budget proposal that could have cost the sector hundreds of millions in income. For a membership organisation that champions and supports the sector, it would have been remiss of us not to act quickly.
Did we prioritise the interests of wealthy philanthropists?
We would dispute this. Our priority has been to protect charities’ income, so they can continue to meet their beneficiaries’ needs. This is why we were able to build a coalition of charities that included the likes of Christian Aid, Help the Hospices, and Save the Children.
Individual giving makes up roughly a third of the sector’s income. 45% of the total amount comes from just 7% of donors – those who give the largest amounts. In 2009/10, Coutts estimate that 80 gifts were made of over £1m. Large donations therefore represent a sizeable chunk of the sector’s income that could not be readily replaced.
Naturally, there are different views about the principles of tax relief. But inasmuch as the UK Government continues to use tax reliefs as a mechanism to attract private investments – into companies, pensions – we believe it is important to continue to offer Gift Aid for donations.
The specific details of Gift Aid have been pored over in recent weeks. As the basic rate of tax is reclaimed by the charity, it is the difference between the basic and higher rates of tax that wealthier individuals can reclaim on their donation. This of course means that the Gift Aid tax relief will always be proportionate; no one can make a personal gain by donating to charity. Nonetheless, Collier and others, feel it is inappropriate.
I personally boil my response down to this: I don’t want to live in a society where the tax system makes it less attractive for wealthy people to give their money away to charities, than to invest it elsewhere. As the tax system allows relief for other types of private investment, I feel that it is only fair to recognise the contribution of donors who give away large sums to good causes.
The more straightforward argument that we have advanced at NCVO is about net benefit. Overall, the total amount of money available for public benefit is higher when tax reliefs incentivise larger donations. The state does not have a monopoly on public benefit; civil society’s role is crucial.
Should NCVO and others be doing more to campaign on the impact of spending cuts?
Give It Back George has obviously been a highly visible campaign, but it has not been our sole focus.
While recognising the scale of fiscal challenges facing the UK economy, we have researched and campaigned on cuts. Last year, we developed a crowdsourcing project in partnership with other VCS bodies – www.voluntarysectorcuts.org.uk – to build intelligence about scale and impact of cuts. Our report, Counting the Cuts, followed.
NCVO’s initial focus was to ensure that the sector is not seen as an ‘easy target’ for cuts, particularly given how much of its work is preventative and saves the Government money. In partnership with NAVCA and ACEVO, we wrote to all Local Authorities last year to ask about their plans and created a ‘Best Value’ guide for LAs to help them work with the sector and adapt to changing financial circumstances. Furthermore, NCVO has intervened in specific cases such as Nottinghamshire, encouraging Eric Pickles, the Minister responsible to get directly involved in the case.
We are keenly aware that the impact of public spending cuts is not just on the VCS, but also on families and individuals directly. Be that through rising unemployment, reduced services, higher eligibility thresholds, or other factors. Many of our members are campaigning on these issues directly: for example, Shelter highlighting the impact of changes to housing benefits. NCVO takes its representative role seriously – and will amplify concerns of our members to Government as appropriate. But we also know where our campaigning expertise and voice is strongest: improving the operating environment for charities, so they can each get on with doing what they do best.
Tell NCVO your views
Having recently joined NCVO, I’ve had the opportunity to read through all the comments submitted to our “Tell NCVO” consultation last year.
It’s clear from these comments that there is strong appetite for NCVO to continue championing the sector’s interests and focussing our efforts on the issues where we can achieve change. So whether it’s the impact of cuts on vulnerable people and communities, the Gift Aid Small Donations Scheme, VAT or something else entirely, we want to continue helping the sector improve the world around it.
Give It Back George achieved its intended result. What we must surely learn from this is that the sector can be at its best when it works together, targets its joint efforts effectively, utilises social media as well as traditional campaigning techniques, and is relevant and timely in its engagement at the political level.
Here at NCVO, we have this week relaunched our ‘Tell NCVO’ webpage, and for members who would like to be involved on a regular basis in NCVO’s policy development, our Yammer policy group. So, it’s back over to you… What else should we learn from Give It Back George? What should our next campaign be?
We look forward to knowing your views – do get in touch.
Charlotte Gardiner, Policy Manager
Charlotte Ravenscroft was NCVO’s head of policy and public services. Charlotte’s wrote about funding, public service delivery, and strengthening the evidence base for voluntary action. She has also worked at The National Lottery Community Fund and the Department for Education. 
