Chancellor urged to give £2bn from dormant assets to civil society

The sector's umbrella bodies have sent a letter to Philip Hammond, in advance of this month's Budget, telling him the money should be used for long-term strategic funding

The Budget is later this month
The Budget is later this month

Charity umbrella bodies have called on the government to commit £2bn from dormant assets for investment in the long-term future of civil society organisations.

The appeal comes in a Budget submission letter sent to Philip Hammond, the Chancellor of the Exchequer, from the chief executives or chairs of charities including the National Council for Voluntary Organisations, the charity leaders body Acevo and the Charity Finance Group.

The letter says civil society organisations are working in an "increasingly tough environment, with severe pressures on local authority funding hitting the people and places facing disadvantage the hardest".

It says the ability of charities to respond to these issues depends on the sector having sufficient resources and the right structures in place.

The Dormant Assets Commission identified last year that up to £2bn could be accessed from dormant financial assets, including pensions, insurance and investments, according to the letter.

"We are calling for this funding to be designated for the purpose of strategic, long-term investment in civil society organisations," it says.

"At a time when the civil society sector has seen significant reductions in grant funding and infrastructure support, combined with the increasing pressures on local government finance, this is an opportunity to inject capital in our communities and strengthen the financial resilience, sustainability and capacity of civil society organisations.

"The government’s Civil Society Strategy has set out a vision for strengthening the capabilities, infrastructure and resources within communities, recognising the economic, civic and social capital that is required for communities to thrive.

"There are a number of ways in which dormant assets funding could be directed to support this long-term vision, including through investment in community ownership of land and buildings, endowments to community foundations, and strategic investment in skills and capacity building around income generation and fundraising."

The letter says that part of the UK Shared Prosperity Fund, set up to tackle inequalities between communities by raising productivity, should be ring-fenced for a successor programme to the European Social Fund.

"This should be comparable to the levels of ESF funding the UK currently receives," it says.

In its submission, the Charity Tax Group called for a number of measures, including improving the transparency of fees when Gift Aid is claimed on donations collected by intermediaries, committing to excluding charities from any anti-tax-avoidance legislation where it is clear they have no tax-avoidance motive and agreeing to carry out a strategic review of the future VAT system with the aim of reducing the irrecoverable VAT charities incur.

The Budget takes place on 29 October.

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in