Up to £200m expected to be wiped off legacies

Sliding property and share prices mean charities will receive less, says report by the Smith Institute

Up to £200m could be wiped off the value of charity legacy incomes this year, according to a report produced for think tank the Smith Institute.

The report, Charitable Legacies in an Environment of Change, produced by Jenny Harrow and Cathy Pharoah at Cass Business School, says the value of charitable legacies has been estimated at £1.9bn a year, but that this figure is expected to drop sharply because of plummeting property and share prices.

The report, published today, says the country's largest fundraising charities currently receive about 12 per cent of their income from legacies.

However, it says reliance on legacy income carries "immense risks" because it is based on the gifts of a small proportion of the population and is subject to wide fluctuations.

"The impact of the downturn is likely to have considerable negative repercussions for legacy giving," says Paul Hackett, director of the Smith Institute, in his introduction to the report.

"With house and share prices falling, and with many donations made as a percentage of a legator's estate, the outcome is likely to be that charities receive a smaller absolute, if not proportional, amount."

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