Gift aid reforms due next year

Finance | Tania Mason | 16 Jun 2009

Government will decide whether extra tax relief available to higher-rate taxpayers when they donate should be instead redirected to charities by next year, according to Stephen Timms, financial secretary to the Treasury.

The sector has called on government to redirect higher rate relief from rich donors to charity. The Treasury, however, is concerned removing incentives for better off donors will lead to reduced giving and is carrying out research into donor behaviour.

Speaking at the Acevo 2009 CEO Summit, Timms said research into “radical proposals” would be completed by the autumn, giving the government time to legislate by next year if it was shown donors would not be put off.

Timms also said the government would earmark £100m from the £1bn Future Jobs Fund to create jobs in the voluntary sector. The fund will create 150,000 jobs for 18 to 24-year-olds in long-term unemployment.

He also said he expected the voluntary sector to have a role as subcontractors in the Department for Work and Pensions’ Flexible New Deal Programmes, but admitted there were barriers: “It’d be good if there were more than 2 out of 22 from the third sector on the prime contractor list in the first round of procurements,” Timms said.

Timms added that the £20m Hardship Fund, also announced in the Budget, would be targeted at larger organisations that had missed out on help in the Government's recession action plan, announced in February.

He said it would be open to organisations whose annual income was over £200,000 and which worked in health, social care, advice, housing support or education and training. He said grants of between £50,000 and £250,000 would be available, assessed on the basis of need.

Directory: Association of Chief Executives of Voluntary Organisations (ACEVO)
Who's Who: Tania Mason

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