Top-slicing Gift Aid better than a levy, argues chair of governance code steering group

Rosie Chapman tells a seminar that funding the Charity Commission this way would be cheaper than a levy on larger charities

Rosie Chapman
Rosie Chapman

Top-slicing Gift Aid to fund the Charity Commission could be a better alternative to the regulator’s proposed levy on large charities, according to Rosie Chapman, chair of the good governance code steering group.

Speaking at a Westminster Legal Policy Forum seminar in London yesterday about charity law and governance, Chapman said that it could be cheaper than implementing a levy system for larger charities, as mooted by the Charity Commission.

"From a personal point of view, I can’t see why changes cannot be made by the Treasury to enable a top-slicing of Gift Aid to fund the commission’s enabling work," Chapman said.

"That seems to be administratively a lot cheaper to run than the Charity Commission trying to set up some convoluted new system."

The commission has argued in favour of charging large charities an annual fee to help support an expansion of its enabling work and help it deal with significant cuts to its funding from central government.

The regulator’s funding has been cut by about £8m since 2010 and is frozen at its current level of £20.3m until 2020.

The commission is expected to launch a consultation on the issue of charging in the near future and has previously said that it hoped charging large charities would raise an additional £7m.

Also speaking at the conference, Susan Elan Jones, the Labour MP for Clwyd South and a co-chair of the All-Party Parliamentary Group on Charities and Volunteering, said the "jury is out" on a levy to fund the Charity Commission and there was scepticism on how charging charities combined with the commission’s role as an independent regulator of the sector.

She said she would also want safeguards to ensure that any levy was not extended to smaller charities in the future.

"I would worry as well that it was the thin end of the wedge in terms of how smaller charities would be protected in the future," said Elan Jones.

"I don’t think it is something that should go carte blanche through parliament. I think it needs serious, serious looking at."

Kenneth Dibble, legal director of the Charity Commission, told the conference that the idea of charging charities for services from the commission was not new, but he thought any levy "will probably require primary legislation".

He said: "We would try to use any money raised in this way for enablement and the supporting aspect of the commission’s work."

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