Charitable giving reforms could lead to huge boost in donations, says Centre for Policy Studies report

Two key changes 'could bring in up to £74bn more'

Reforms to charitable giving could boost donations from the "reasonably well-off" by up to £74bn, according to a new report.

Paul Palmer, professor of voluntary sector management at Cass Business School, suggests two changes that he says could unlock 10 per cent of the £740bn held by the 820,000 Britons with a net wealth of more than £500,000 in assets beyond the family home, such as pension funds.

In the paper, A Step Change in UK Philanthropy, published by the Centre for Policy Studies, Palmer recommends enabling individuals to set up ‘remainder trusts' for £50,000 or more. These would be similar to charitable trusts but able to be controlled and accessed by donors, permitting tax-free income generated from the trust to be distributed to good causes.

The other idea is to create a new type of charity, called a personal charitable trust, based on US and Canadian models and which allows donors to retain anonymity. These would also benefit from light-touch regulation and be free of many of the reporting burdens imposed on larger charities.

Palmer said the reforms addressed the "u-curve problem" – the fact people at the extremes of wealth are the most generous – by making giving more attractive to those in the middle.

The total income of general charities in 2006-7 was £33.2bn, according to the lastest Civil Society Almanac, published by umbrella group the NCVO.

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