A paper from 10 organisations, inlcuding Acevo, the Charity Finance Group and the IoF says the next government should consider reducing the tax burden on the sector and reviewing the social value act
A group of voluntary sector umbrella bodies has called on the major political parties to commit to engaging with civil society organisations.
The paper, produced by a group of 10 organisations including Acevo, the Charity Finance Group, the Institute of Fundraising and the local infrastructure body Navca, invites the next government to consider helping voluntary sector organisations by reducing the tax burden on them, investing in community assets and reviewing the social value act.
It says the quickest and most effective way to unlock funding to drive economic growth in local communities would be by reducing the tax burden on charities and community interest companies.
It says the government would be able to be confident that money released would be invested in what it calls the “real economy”, such as a small charity buying paper for printing or a social enterprise employing local people, because much charitable funding is restricted.
“Government must not forget that voluntary, community and social enterprise organisations are economic actors and investors as well as creators of positive social change,” it says.
“There are a number of simple measures that could relieve the tax burden on charities. These include expanding the existing VAT rebate mechanism introduced for hospices, blood bikes and search-and-rescue charities to the sector as a whole.”
The paper suggests further investment in community ownership of assets “to grow cohesive communities”.
It says demand from communities to take over community assets is growing but central government support for transfers has come to an end, making it impossible for some to take place.
“Community ownership of assets presents a huge opportunity to regenerate local economies, reshape public services and give local people greater control over the places they live.
“Crucially, owning assets can help provide a sustainable income base for local voluntary organisations at a time of growing financial uncertainty.
“By creating a coordinated programme of investment in community assets, the next government could help enterprising communities transform their neighbourhoods and secure the future of our most important community buildings.”
The paper also suggests a review of the social value legislation, which encourages public commissioners to consider the social value offered by bidding organisations alongside financial considerations but has been criticised for being too weak.
“By strengthening and supporting the act, every penny of public money can go towards delivering the economic, social and environmental goals of our country,” it says.
“This is a key part of the reform to commissioning that is needed to ensure charities and social enterprises, especially small ones, are best able to support individuals and communities.
“We believe that charities and social enterprises are ideal partners to deliver services and make public spending more effective. Getting the right rules in place will unleash their potential to drive change.”
The other organisations behind the letter are the Association of Charitable Foundations, Children England, the Ethical Property Foundation, Locality, the Small Charities Coalition and Social Enterprise UK.