We need new dialogue, charity bodies tell the Treasury

A letter to the Chancellor, Phillip Hammond, from the Charity Finance Group, the NCVO and Acevo, among others, says the government should give the sector better support

A new dialogue is needed between the charity sector and government, according to a letter to the Chancellor of the Exchequer from 10 different charity sector representative bodies.

A letter about next month’s Autumn Statement, sent to Phillip Hammond by organisations including the Charity Finance Group, the National Council for Voluntary Organisations and the chief executives body Acevo, calls for greater government support for the charity sector and appreciation of the important role it plays in society.

"As the beating heart of a vibrant democratic society, small and medium-sized charities enable government to understand the aspirations and needs of communities across the country and work towards a society where barriers to opportunity are eliminated," the letter says.

"Indeed, government cannot achieve its mission of making Britain a country that works for everyone without them. Yet there is a critical need for government to find a more effective, joined-up and strategic way of working with the sector to maximise its potential and achieve its mission faster."

The letter says the charity sector is keen that the Autumn Statement, which will be published on 23 November, should be "the start of a new dialogue between the sector and the government, so together we can better tackle the challenges we all face".

The letter says the government can help charities in three areas: economic growth, supporting people to take ownership of their local areas and innovation in technology.

On economic growth, the letter says irrevocable VAT should be addressed through a rebate scheme and a change of VAT exemptions to zero ratings.

It says a new process is needed to help distribute government funding outside normal departmental spending on "an impartial basis according to the sector’s strategic needs".

The letter suggests a grant scheme to help charities purchase new technology and a three-year programme called Connect for Good, which would bring together the technology and charity sectors.

The letter also suggests the establishment of a community capital fund that would provide support and investment for community asset ownership and the setting up of 60 new partnership hubs in the most deprived local authority areas, which would enhance joint work with the voluntary sector.

Other signatories of the letter include the infrastructure body Navca, Voice4Change England, the Small Charities Coalition, the Association of Charitable Foundations, Locality, the Institute of Fundraising and Social Enterprise UK.

In a separate letter to the Treasury, the Charity Tax Group says the Autumn Statement should include changes to the VAT system and the Gift Aid Small Donations Scheme, and a delay to the apprenticeship levy.

It claims that irrecoverable VAT costs charities about £1.5bn a year and also is a disincentive to charities that want to take over the delivery of public services.

The letter says that targeted VAT refund schemes for the sector would help to ease the VAT burden on charities, with opportunities to further reform the system once the UK has departed the European Union.

The reinstatement of the research and development expenditure credit for non-university charities, continued work to address concerns about the Common Reporting Standard and an exemption for charities from legislation on the transfer of corporate profits is also highlighted in the CTG’s letter.

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