This April fool urges sector caution over Budget hopes

With further cuts to come, charities must pre-empt, plan and prepare for hard times to come, writes Caron Bradshaw

Caron Bradshaw
Caron Bradshaw

I sat down to write my April column as last month's Budget approached and anticipation mounted in CFG's office. Would we see any rabbits pulled from proverbial hats? Would it be good or bad news for our sector?

I then noticed that this column would appear on April Fools Day. Among many stories about the origin of this annual celebration of jokes and hoaxes, my favourite is the one that the Roman Emperor Constantine granted his court jester the right to be king for a day. The jester seized the opportunity to leave his mark on posterity by passing a law declaring it a "day of absurdity". According to one academic, "in those times fools were really wise men; it was the role of jesters to put things into perspective" - an interesting thought as we try to make sense of the Chancellor's pronouncements.

Radical changes

With an election on the horizon, George Osborne could not let pass the opportunity to woo potential voters. And that is what appeared to drive tax breaks on bingo, beer, whisky, petrol and improved conditions for savers - all rounded off with perhaps the most radical changes in years to defined-contribution pensions (the implications of which for the sector are something that, at the time of writing, I am yet to unpick).

Abolishing the obligation to buy an annuity on retirement has obvious appeal, especially for those with smaller pension pots. But I cannot help wondering whether these changes are for good or ill. Osborne said we could trust pensioners to make their own decisions, but wasn't it precisely because the government couldn't trust people to make the right decisions about saving for retirement that auto-enrolment is now mandatory?

Promising references

References to charity were, as usual, limited, but there was some good news for parts of our sector. The waiver of VAT on fuel for air ambulances and inland rescue boat charities will bring welcome help with running costs. There were also promising references to help with repairs to historic buildings and good news on cultural gifts. We were glad to see confirmation that the social investment tax relief would be set at 30 per cent - a rate that we hope will prove to be high enough to be useful, but not so high as to damage Gift Aid. Finally, the move to reach out to small charities and increase engagement in the Gift Aid Small Donations Scheme was welcome.

Considering myself more a fool than one of the wise men, I see it as my role to conclude with a little perspective. The Chancellor spoke with confidence about an improving economy. However, if we think things are going to get better any time soon, we must think again. We were warned that there would be further cuts to endure and that the controls on public expenditure would continue long after the next election, whoever wins. We must pre-empt, plan and prepare for hard times to come. But, like all good jesters, I encourage you to smile and laugh - and don't let the wise men get you down.

Caron Bradshaw is chief executive of the Charity Finance Group

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