Only a few days to go: We’re raising £25,000 to keep TheyWorkForYou running and make sure people across the UK can hold their elected representatives to account.

Donate to our crowdfunder

New Clause 1 - Annual report

Part of Small Charitable Donations Bill – in a Public Bill Committee at 3:45 pm on 30th October 2012.

Alert me about debates like this

Photo of Gareth Thomas Gareth Thomas Shadow Minister (Cabinet Office), Party Chair, Co-operative Party 3:45 pm, 30th October 2012

That is true, but equally would it not be better to have it in the Bill, rather than have to make the necessary diary note in the first place? Where there is controversy—as there clearly is on whether the eligibility criteria written into the scheme will benefit as many charities as the Minister says they will—surely it is sensible to have in place the mechanism for an annual report, and for a sensibly timed review of the Bill. We think that two years for a proper review is sensible, and that to help set the agenda for such a review we should have an annual report looking at the implementation of the Act after 12 months.

I encourage the hon. Gentleman to show the same flexibility of spirit that he hinted at in his speech on clause 1 and support us on new clause 1. I think he wants to. The hon. Member for Chelsea and Fulham is out of the Committee Room at the moment. Let us hope he stays out of the room. Perhaps the hon. Member for Stafford will feel less intimidated and want to be with us on the right side of the argument.

The NCVO, in its letter to us, went on to suggest that the Minister had perhaps inadvertently given the impression that a lot more charities would benefit under the terms of the Bill than will actually do so. I gently suggest to members of the Committee that the idea that four out of five charities will not benefit from a scheme that is potentially worth £105 million in the third year of its operation, when roughly £3.3 billion is set to be lost to the charity sector from Government financial support by 2015, ought to be seriously alarming for all of us, because that could mean that relatively huge numbers of small charities in all of our constituencies will not benefit in the way that they could have done.

It would be good if the Minister, before Report, committed to providing answers to a series of questions relating to new clauses 1 and 2. Let me set out what those questions are, because they will help to inform the run-up to publication of an annual report and to influence the context in the run-up to a formal review after two years. Specifically, how many organisations claim gift aid that are not covered by Charity Commission data? It would be helpful for HMRC, through the Minister, to release that figure. How many general charities are claiming gift aid? How many organisations have made claims for gift aid in three of the past seven years? How many of the 65,000 organisations that the Ministers hinted he thinks will claim in the first year under the scheme would be eligible if the track record was reduced to one or two years of successful gift aid claims, instead of three?

The Minister also hinted at flexibility on the matching rule. That was good to hear, but it would useful to know. The NCVO hinted that it thinks there are approximately 25,000 charities putting in gift aid claims in the range of £0 to £1,000. It is difficult to break that down further to see how many charities have claimed  less than £625 per year. It would be helpful if the Minister was willing to ask HMRC to give us a bit more information, so we can break that down further and have a more meaningful debate on Report and, crucially, in the run-up the publication of the annual report and the review clause.

In the evidence session, we heard the NCVO's serious concern that a series of small charities might miss out because the harsh eligibility criteria, which the Minister insists on defending, have the potential to put them off. We heard about the Telford and Wrekin Senior Citizens’ Forum, the Wiltshire Rural Music School, Cumbria Action for Sustainability and Southside Young Leaders’ Academy. A review clause would give the Minister and HMRC time to reflect on whether more could be done to help such crucial organisations. I am sure that we can all think of similar organisations that do huge amounts of good in our constituencies, which would benefit from the £1,250 in full, but which are likely to miss out.

I suspect that the hon. Member for Brentford and Isleworth is secretly sympathetic to the concerns we have raised about the Bill. It was not clear from her facial expressions, I think it is fair to say, whether the Isleworth community school parent teacher association has registered for three years of successful gift aid claims. I am sure that she, with the background of the type of school that she says she went to, would not want that very worthy charity in her constituency to miss out. She will recognise the unfairness of Eton benefiting from this scheme and the Isleworth community school PTA not benefiting—it seems a huge unfairness.

I do not know whether the hon. Member for Stafford knows of the Telford and Wrekin Senior Citizens’ Forum, but I am sure that he will recognise a similar Stafford senior citizens’ forum and it seems a huge shame that such an organisation, perhaps registered for gift aid, but not for three years, should have to wait until he loses the election and a Labour Government reforms this system for it to benefit under the terms of the Bill.

The hon. Member for Congleton may not know of the Wiltshire Rural Music School, but perhaps there is a Congleton or a Macclesfield music school, perhaps it is a charity registered for gift aid but does not have three years of claims. An annual report and a review mechanism would allow her time to reflect on our exchanges today, perhaps allow her time to use her influence on the Minister, perhaps allow her time to do what the Minister says he is going to do and get HMRC to a charity day in her constituency and try to help charities benefit, not only from gift aid but from the small donations scheme.

Again, why should such a Congleton or a Macclesfield music school have to wait for the election of a Labour Government to get a review clause? Why does the hon. Lady not back our amendment and get an annual report locked into the framework of the Bill to serve as a useful trigger for an opportunity for her to use the considerable influence we saw in the debate about the matching rule to persuade the Minister to reflect on further changes to the eligibility criteria? I urge Government Members to recognise the merit of an annual report and to look at the detail of implementation of a formal review clause.

We hope that the Minister will be particularly persuasive on new clause 1 and new clause 2. We would not want to have to divide the Committee when there has been so much consensus, when we have been able to persuade Government Back Benchers to be so sympathetic to our concerns. I hope that the Minister is ready for the challenge of responding persuasively and articulately to convince us that he is willing to consider further changes to the eligibility criteria implicit in the Bill, such that an annual report and a review mechanism are not required.