Community Foundation Network launches Grassroots fund

Finance | Ian Allsop | 8 Jul 2008

The Community Foundation Network has unveiled a new fund offering philanthropists “all the advantages of a private charitable trust but without the administrative overheads”.

The Grassroots Personal Fund was announced on the same day that applicants to the government’s £130m Grassroots Grants programme received notification about whether they had been successful - though no official confirmation has yet been given that one is the source of the other.

Funded by Office of the Third Sector (OTS) and delivered by the Community Development Foundation (CDF), Grassroots Grants, which will run from 2008-2011, is divided into two parts: an £80m small grants fund for community organisations; and a £50m endowments challenge programme to enable local funders to generate additional donations on a matched basis and invest them in endowments.

85 per cent to Network members

Applicants to both schemes were informed by post last Thursday whether they had been successful, ahead of an official announcement by CDF on 17 July. Speaking to Charity News Alert, Community Foundation Network (CFN) chief executive Stephen Hammersley said that research among its members indicated that at least 85 per cent of the money will go to one of its members.

Details of the £50m challenge programme were first announced in April, when Hammersley (pictured) said that it could potentially lead to the creation of over £1bn in endowment funds for local communities.

It will be used to create a direct cash incentive for private philanthropists to give money to build up large cash funds on behalf of communities. The income from these funds is then managed by organisations, such as community foundations, to provide long-term, sustainable, financial support to a wide range of local community organisations and initiatives.

£77k becomes £256k

Higher-rate taxpayers could see their net gifts increase by up to 333 per cent as the government adds gift aid and then matches every gift-aided donation. This could mean that, for a donation costing £77,000, local charities could receive £256,000.

The inspiration for the programme was a similar initiative in the early 1990s when three community foundations managed to generate endowed funds in excess of £65m by attracting over 300 individual and corporate philanthropists, using a government fund - described by the Office of the Third Sector as a "pump-priming fund" - of only £2m.

Who's Who: Ian Allsop

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