The Budget: an opportunity for the Government to deliver for charities

This week will see the first Budget delivered by a Conservative majority government since 1996. The Chancellor George Osborne, freed from his former Coalition partners, will set out his plans for the future of the nation’s finances, and we can expect to see a number of the policies from the Conservative Party’s manifesto enacted. But what will the Emergency Budget mean for charities?

osb

Here are five things we’ll be watching out for on Wednesday:

  • With the Government set to expand on the Northern Powerhouse concept, we can expect further movement on the devolution agenda. As power gets devolved to communities there will be opportunities for local charities to use their expertise to help people. The Budget will help explain how greater devolution will become reality and what it may mean, but it’s important that national and local government put in place programmes to make sure that charities can compete fairly for contracts and have the support they need to achieve positive outcomes.
  • Although the local government settlement for 2015/16 has already been agreed, the possibility of a further announcement about funding for local government cannot be ruled out. Reductions in the amount distributed to councils has hit charities hard, and charities will be wary of any further cuts to local government budgets that could impact upon them.
  • In recent years the Chancellor has used the revenue from banking fines to support charitable causes, with a particular focus on military and medical charities. There are legitimate concerns about the Government picking charities to benefit in this way (although they did recently confirm that charities can be put forward as possible recipients), it seems likely charities will continue to be the beneficiaries of wrongdoing in the financial services sector.
  • Last year’s Autumn Statement brought VAT refunds for some charities, including hospices and air ambulance charities. With many charities struggling to deal with the combination of falling income and rising demand, could the Government go further and extent this support to more organisations?
  • The Conservative party’s manifesto made some positive noises about civil society and the importance of volunteering. The Chancellor’s first major announcement since the General Election should give us an indication of the extent to which the Conservatives intend to deliver on this in government. Questions have been raised about whether the commitment to give staff three days of leave a year to volunteer will be implemented, although the Government has been quick to try and quash this speculation. Plans to increase the use of social impact bonds and Payment-by-Results contract could also make it onto the Chancellor’s agenda.

Of course, there are other issues that will impact charities that will get a mention too. Changes to tax thresholds and inheritance tax could impact upon Gift Aid, and the Government’s much publicised plans to reduce the cost of the welfare budget could drive up demand for charities, many of whom are already struggling to cope with the need for services.

 

The first Budget of this Parliament would be a great opportunity for Government to demonstrate its commitment to a strong, thriving civil society. Let’s hope it delivers.

Steve Clapperton

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