Institute blames employer 'apathy' as it returns £4m payroll giving grant to Government

Nearly half of an £8.3m grant to encourage small and medium sized businesses to set up payroll giving schemes has been handed back to the Government because it could not be spent.

The Institute of Fundraising returned £4m of the grant to the Office of the Third Sector and blames employer “apathy”.

The small and medium enterprise payroll giving grants programme, which ended in March this year, did succeed in persuading 3,380 employers to create workplace giving schemes, exceeding its targets.

However, many firms did not claim the grants, of between £300 and £500, they were entitled to as a reward. But most importantly, the match-funding element of the project, which guaranteed to match any gift of up to £10 by an employee for six months, fell way below expectations because firms did not promote the schemes they had set up. About 18,000 employees took advantage of the match funding offer but the institute had budgeted for between 32,000 and 70,000 sign ups at the start of the project.

Tina Steele, payroll giving project manager at the Institute of Fundraising, said: “This is the extent of the apathy in payroll giving. We didn’t encourage employers to act quickly enough.”

She added: “You are really in the hands of the employer and for one reason or another they wouldn’t promote the scheme in the workplace and you got very few people taking it up.”

The payroll giving grants programme was announced by Gordon Brown in his 2004 budget. Responsibility for the scheme was passed to the Home Office, but the Treasury insisted that the project was over-budgeted by £2m because of fears it would run out of money. As it turned out, it under-spent by £2m.

The money was returned to the Office of the Third Sector. A spokesman said the money has been allocated to volunteering projects.

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