Michael Brophy was chief executive of Charities Aid Foundation until 2002.
In today's Budget, Gordon Brown will have to raise taxes to fill the growing hole in the economy. This makes it imperative to recover every possible penny on charitable giving.
My recipe for 'Brownie cakes' combines tax breaks on savings to create an asset that can then be donated, achieving an 80 per cent tax advantage. It's ideal for consumption by City high-fliers.
Prepare the mix
Pay by direct debit into an ISA - £80 a month, say. It comes from the top end of earnings and is tax-efficient. Redeem after five years for a tax-free sum up to £8,000.
Keep adding to the mix by taking out more ISAs in years two to five.
By then you are direct debiting £400 a month, near the annual limit for tax efficiency.
Allow cake to rise
In years six to 10, about £8,000 will be added tax-free each year.
Serve with more Brown sugar
Give portions to a charitable trust by Gift Aid, taking a 40 per tax break on top of tax saved by ISAs (cooks may want to put the reclaimed higher tax rate back into the mix to reduce the cost of the ISAs, or donate it to the charitable fund).
Tips for the future
After 10 years, the charitable total should be close to £100,000; at 20 years - with average earnings and more ISAs - it's £300,000.
City people in syndicates of 10 would soon top £1m at an effective cost of 20 per cent. After five years, more ambitious folk might approach Charity Bank to offer a guaranteed £1m of deposit over a fixed period in exchange for up-front funding of, say, an inner-city primary school.
For high-fliers, London's Capital Community Foundation would help set up a revolving loan fund for London's poor.
And for richer Indian, Chinese and South African people, why not set up large development loans for family and neighbourhoods back home?
The excitement of clever financing gives a buzz to the upwardly mobile, and a charity endowment will help you become senior partner or maybe Lord Mayor of London. Brownie cakes mean Brownie points.