The RNLI chief executive tells David Ainsworth that he likes the idea of the big society but his charity's tax bill has gone up and the VAT relief system for charities makes little sense
Paul Boissier says he likes the idea of the big society very much. "Who could possibly object to the big society?" he says. "It's a great idea, and the whole concept of communities has greater currency because of it."
Since becoming chief executive of the Royal National Lifeboat Institution in 2009, the former submariner has become passionate about the role that charities can play in communities and believes the RNLI is an exemplar of what the Prime Minister, David Cameron, wants the big society to achieve.
But he is also clear that the government's time in office has left his charity worse off. "The day after the Budget in March, I woke up and realised that we were going to have to find an extra £650,000 a year," he says. "The loss of transitional relief on Gift Aid cost us £400,000; the VAT rise cost us £200,000; and the increase in national insurance cost us £50,000.
"At a time when it's already difficult for us, and for others, we found we had this additional burden. That £650,000 would pay for lifeguards on 20 beaches.
"I think when the government increases taxation, it should have one eye on the sector. This isn't party political: I think the message is the same for all parties."
Boissier points out that many other charities, like his own, provide services that the government would otherwise have to provide. But if a government agency provided lifeboats and lifeguards, it would not have to pay its £2m-a-year VAT bill.
"They also couldn't do it as efficiently because they couldn't harness the same volunteer workforce," he says. "About 97 per cent of people who work for the RNLI are volunteers, and that's not a model that could be replicated.
"Moreover, we do it from deep within the community. Our crews come from within the communities they serve. The repairs are done by local people. I think a lot of other charities work that deeply within their communities, too."
Boissier admits that the Budget also contained welcome measures to encourage giving, but says that, in the short term, they will probably not replace the extra tax his charity has to pay. He likes the taxation model pioneered in Denmark, which gives charities rebates on VAT, and would like to see it used in the UK.
"There's a movement in the European community to exempt organisations that provide community services from taxes such as VAT, in the same way as is done for government agencies that provide similar services. That would be a good way to help the sector at large."
At the moment, he says, tax reliefs for the charitable sector are a strange collection that appear to make little sense. "What's recoverable and what's not recoverable is difficult to understand," he says. "For example, we can recover VAT on repairs to lifeboat station doors but not to roofs. I'm sure there's a logic there, but it's not readily apparent."
Socially responsible nation
Despite his concerns, Boissier says the sector has a duty to understand the "sizeable problem" the government faces. He feels that Cameron has done well to use the big society to introduce the idea of community, and says the sector should give it time.
"Putting the idea in the political space has done some beneficial things," he says. "It's an ambitious undertaking to launch this idea that, as a nation, we are somehow going to be more socially responsible."
And he says he is not worried by the fact that little direct benefit has accrued to his own charity. The RNLI has weathered the recession relatively well, he says, although it is fighting hard for income to keep pace with inflation.
"A significant part of our income comes from legacies, and that's largely in the form of houses and shares," he says. "Unfortunately, the housing market is flat and the equity market is all over the place.
"Inflation in the price of buildings is considerably higher than the Retail Price Index, and it's the same with raw materials for boats."
The recession has inspired a "lean programme" at his charity, which he wants eventually to save up to £20m a year. So far, £13m of savings have been identified, but have led to only 25 redundancies.
Boissier believes that, in the end, the recession might provide useful lessons for charities. "We're in a time of Darwinian transition," he says. "Some charities will be able to carry on, some will merge and some will find new and innovative ways of raising money.
"There is a silver lining, although it's on a pretty black cloud: this period will undoubtedly change the charity sector, but it might change us for the better. I hope it will make us stronger."
2009: Chief executive, RNLI
2006: Deputy Commander-in-Chief, Fleet
2004: Director general, Naval Support
2002: Deputy Commander, Striking Forces Nato
2000: Commander, Portsmouth Naval Base