The amount of money raised through payroll giving has fallen for the second successive year, declining by £8m over the past 12 months, according to provisional figures published by HM Revenue & Customs.
HMRC figures, published today, show that the total amount raised this way fell to an estimated £126m in 2014/15 from £134m the previous year, which was also down on the £155m donated in 2012/13.
The total donated had previously risen in every year from 2008/09 to 2012/13. The figures show that the number of people donating this way fell by 26,000 over the past year to 1,094,000, while the cost to the Treasury of income tax relief has remained stable for the past four years at £40m.
The news comes after some predicted that the government’s withdrawal of funding earlier this year from two awards schemes set up to recognise employers that encourage payroll giving among staff would have a detrimental impact on payroll giving levels.
In a document published with the figures, HMRC said that the despite the decline in both donors and the amount donated, the overall trend was still "upward when compared across the whole period".
It said: "Indeed, the gross amount donated via payroll giving only seems to have fallen in the last two years when compared to the peak achieved in 2012/13."
It said the amount raised in 2012/13 was a peak caused by a single large donation, adding that year-on-year data should be treated with caution and direct comparisons were difficult because of changes to data-collection methods in 2012/13.
A spokesman for the Charities Aid Foundation, which administers Gift Aid schemes, said it was not possible to say at this point what the reasons might be for the decrease suggested by the provisional figures.
He said CAF believed payroll giving had "huge untapped potential as a simple and effective way of giving to good causes" and would continue to work hard to encourage employers to open this up to their staff.
Workplace Giving UK, the payroll-giving agency that runs the Geared for Giving campaign, said in 2008 that it expected payroll giving figures to continue to rise as the number of employers offering schemes increased.
But Linda Cohen, manager of Geared for Giving, told Third Sector in March she was disheartened the coalition government had not done more to drive payroll giving forward during the last parliament. She predicted at the time that the government’s decision to withdraw funding from the Payroll Giving Quality Mark scheme and the National Payroll Giving Excellence Awards would have a "catastrophic" effect.
In March the government announced that it had signed a memorandum of understanding with representatives from the Institute of Fundraising, the Charities Aid Foundation, the payroll-giving providers Charitable Giving, the Charities Trust, GiveAll and Stewardship, and the professional services firm Deloitte to help charities make the most of payroll giving. The Treasury said at the time that the agreement had been created to increase transparency and clarity in information-sharing between the government, charities and payroll-giving agencies.