Five decisions the next government should take to support charities

We’re now into the third General Election in five years – and whichever party or parties forms the next government, they would be foolish to ignore charities, social enterprises and the wider voluntary sector as they craft their policy platforms and plans.

The sector is so important to progress across so many policy areas, not just in terms of service delivery, but to provide crucial evidence about social need and constructive policy solutions.

Party manifestos are forthcoming and we’ll see what they say – it’s too late to influence these further as the General Election battle commences, but not too late to influence what the next government does, or the issues MPs raise once Parliament reconvenes.

Here are five things DSC believes would help make our sector more resilient and effective – and therefore better able to support communities across the country.

1. Refund the National Lottery Community Fund from the 2012 Olympics

DSC’s Big Lottery Refund campaign demands the immediate repayment of £425m in National Lottery money, which was raided from the Big Lottery Fund in 2007 to support the London 2012 Olympics. There is already a legal commitment to repay this money, but recent governments have said this will not happen until ‘the 2020s’ or later – which is just in a matter of months! A fraction of the full amount has been repaid so far and at the current rate repaying all £425m will take decades – but millions of people and communities across the UK urgently need access to these vital funds today.

The next government should renegotiate the assets repayment deal with the London Legacy Development Corporation, so that the £425m which is owed to the National Lottery Community Fund from asset sales is immediately repaid and can be distributed to communities. After repaying this debt to the Lottery, the government would then become the recipient of future assets sales as they are realised.

2. Stop the Charity Commission charging charities, and fund it properly

The Government and the Charity Commission have been discussing the possibility of charging charities for regulation for years. Although the Chancellor’s recent Budget announced more funds for the Commission, we don’t know how these will be used and whether charging is still on the table.

There are so many reasons why this is a bad idea – not least because it would create conflicts of interest between charities and their primary regulator. Recent actions and messages from the Commission’s leadership reveal yet another downside – why should charities pay for the privilege of being lectured or even defamed in the press by their regulator? Why should trustees, who volunteer in good faith, use their charity’s funds to assist the Commission to prosecute them in the court of ‘public opinion’ when things go wrong?

Public funding from taxation underpins the Commission’s independence and gives both the public and charities confidence that it has the potential to act objectively and impartially.

The next Government should scrap plans to charge charities for regulation and work with the Commission to ensure adequate, longer-term funding via general taxation. This funding must support the quality and accessibility of the Charity Commission’s services for charity trustees.

3. Reform the Lobbying Act – so trustees can campaign with confidence

DSC believes in the value and right of charities to campaign politically on behalf of their beneficiaries within the limits of charity law. Yet electoral rules and regulations which are too often flaunted by political parties and campaigns have had the effect of muzzling charity trustees. The so-called ‘Lobbying Act’, passed in 2014, is part of a maze of complex legislation affecting charity campaigning. Research shows the Act had a ‘chilling effect’ on civil society organisations at the 2015 General Election. Despite this, the Act came in to force again at the 2017 snap election, and the rules were applied retrospectively to June 2016. It’s still on the books now.

Fortunately, this has all been examined in detail and there is a solution. A government-commissioned review undertaken by Lord Hodgson in 2016 recommended significant changes to the Act, and the House of Lords Select Committee on Charities called on the Government to implement its recommendations in full.

The next government should fully implement Lord Hodgson’s recommendations, including legislation, to minimise charities’ unnecessary regulatory exposure to that Act and related legislation, so they can campaign on behalf of beneficiaries and causes with confidence.

4. Restore grant funding – to empower people and strengthen communities

DSC believes that the best way of meeting beneficiaries’ needs should drive service design and funding models, and that for most charities, particularly the vast majority which are small and volunteer-run, grants are a far better way of doing this. Despite this, grant-making by public bodies has dramatically declined at the expense of contracts and social investment. DSC co-convenes the Grants for Good campaign which argues for the benefits of grants and aims to reduce their decline.

All political parties, MPs, and local councillors should support public sector grants and grant-making not just by committing expenditure, but by seeking out, promoting and investing in best practice.

5. Create a Community Wealth Fund – free of government control

Ten years ago, assets from dormant bank accounts were released for social use via an overly complex and costly focus on ‘social investment’ and the creation of a new wholesale bank, ‘Big Society Capital’. The mechanisms and type of finance were dominated by government policy priorities at the time, in particular around public services, rather than what communities needed.

However, a further £2bn of dormant financial assets is estimated to be locked up in stocks, shares, bonds and insurance. After ten years of austerity, it’s vital that these are recovered and put to use under community control, not for short-term, top-down government priorities.

The Community Wealth fund would use these assets to create an independent endowment to support our most deprived areas over a 10-15 year span. This would develop civic assets and community engagement in neighbourhoods that have been ‘left behind’.

The next government should pass the legislation to create a Community Wealth Fund. DSC supports this initiative – more information and briefing is available from the Local Trust.

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