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Government tightens belt but confirms three-year funding

Finance | 1 Nov 2007

The Charity Commission will receive £500,000 during 2007-08 to help it deliver its new responsibilities under the Charities Act, but will be faced with a 5 per cent funding cut each year until 2011. The news came in the long-awaited Comprehensive Spending Review, published last month by the Treasury, in which the government outlined its spending plans until 2011 and highlighted the third sector’s role in its strategy for empowering communities.

The Commission’s baseline budget for 2007-08, originally set at £30.2m, will now rise to £31.7m, which includes the extra £500,000 plus an existing commitment of £1m to support the implementation of its counter-terrorism strategy. However, funding will fall to £30.9m for 2008-09, to £30.2m in 2009-10, and to £29.4m in 2010-11.

Andrew Hind, chief executive of the Commission, said meeting the new responsibilities of the Charities Act under the new agreement, would be a “tough challenge”. However, he added: “We are confident that we can deliver against our core responsibilities over the next three years.”

Despite concerns that the Commission would struggle to find the capacity to manage all the new requirements under the Act, including the licensing of public collections, Hind said the Commission was committed to implementing everything that had fallen to it.

The bulk of the commitments to the third sector had already been announced by the Office of the Third Sector and it confirmed many of the recommendations made in the government’s third sector review, published in July.

The government also published 30 new public service agreements, designed to set the government’s priorities in delivering public services, including one entitled ‘Build more cohesive, empowered and active communities’. This confirmed the government’s commitment to three-year funding, making it the Office of the Third Sector’s responsibility to “drive progress” in making all government departments see three-year funding as the norm, rather than the exception.

Ed Miliband, minister for the Cabinet Office (pictured), said the CSR put into effect the proposals of the government’s third sector review. “The review follows the biggest ever consultation with the third sector – so it’s a direct response to what it wants. This CSR enables the Office to ensure that the third sector is fully reflected in the delivery plans of the key departments.”

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