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CAF calls for charity reforms worth £1bn

17 Apr 2020 News

Rhodri Davies, CAF

The government should back “radical ideas” to free up £1bn for charities during the coronavirus crisis, according to a new report from the Charities Aid Foundation (CAF).

The report argues that extra funds could be made available through reform to the rules around Gift Aid, legacy giving and the use of dormant charity bank accounts, as well as government support for a philanthropy drive.

CAF recommends that the government should temporarily relax the rules on declaring Gift Aid, so that charities receive the 25% additional benefit for every donation made. The report estimates that this has the potential to raise £600m extra for charities each year, with the measures ending in 2021.

Unlocking the National Fund

It also suggests that the assets held by the National Fund, which was established a century ago and holds around £500m earmarked for repaying the national debt, could be released to charities today. The Fund could potentially be nationalised, CAF says.

The report argues for the introduction of “living legacies”, which would allow people to bring forward charitable gifts they planned to leave in their wills, based on existing models in the United States which allow individuals to make bring forward capital gifts to good causes while still claiming personal income on that gift for a set period of time.

Finally, CAF calls on the government and civil society to back a “big philanthropy pledge” to increase donations from wealthy individuals and corporates, and encourages greater collaboration between government, charities and the private sector to support society through the crisis.

'Extraordinary times call for extraordinary measures'

Rhodri Davies, the head of policy at CAF, said: “In these times of crisis we need to employ radical ideas to bolster the charities which are an integral part of life in the UK. These proposals include elements which, in normal times, would not be considered but these extraordinary times call for extraordinary measures to help protect the invaluable work of charities.

“The chancellor recently brought forward welcome and important support for charities but was clear that he couldn’t intervene to help them all. We hope these bold ideas will be taken up by ministers, regulators and our colleagues in the charity world to unleash support that we need now to keep charities alive for the future.

“The contribution of charities has never been more evident and every course of action we can take to ensure they will be there to continue helping society’s most vulnerable needs to be considered at pace.”

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