# 2011 Budget – what NFP organisations need and what they are likely to get

- Link: https://fundraising.co.uk/2011/03/22/2011-budget-what-nfp-organisations-need-and-what-they-are-likely-get/
- Published: 2011-03-22T13:51:18+00:00
- Author: Howard Lake

![](https://www.fundraising.co.uk/files/images/news/david_pinches.jpg)

Whilst all sectors of society – families, pensioners, students, trade unions and
businesses – are fearful of the measures that George Osborne will outline in his
budget on 23rd March, it is arguably the not-for-profit sector which has the most
reason to be concerned.

Already, the sector has been hit by the 2.5% increase in VAT and the imminent end
of Gift Aid transitional relief. Of course on top of this is the drastic reduction
or, in many cases, termination of the Government funding upon which many charities
rely upon, and decreasing public donations to charity as a result of the economic
downturn. However, the Coalition believes that its vision of a Big Society, where
more of us volunteer our time to help local charities and community initiatives,
can fill the gap created by reduced central funding.

We recently carried out a survey amongst a select number of our NFP customers. Encouragingly,
most remain fairly upbeat about the prospects for their organisation over the next
year to 18 months. However, what was most striking about the survey’s findings was
that almost 90% of respondents do not feel that the Government has clearly communicated
and set out exactly how the Big Society will work. Less than 20% think that the 
Big Society has the potential to make up for cuts in charity funding and, perhaps
the greatest indictment of the Coalition’s strategy, less than 12% have actually
seen an increase in volunteering for their organisations since the Big Society was
launched.

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Clearly the budget is going to hit the third sector hard – some commentators have
predicted net reductions in central funding in excess of 50%. Whether or not one
agrees with such an aggressive approach to reducing the deficit, what the Government
must do for the NFP sector is put in place effective guidelines and legislation 
to allow charities to maximise funding from other sources. This means simplifying
the tax relief system to encourage easier and more widespread usage of Gift Aid 
and Payroll Giving. And, most importantly, the Government must ensure the investments
that it does make in the charity sector are aimed at promoting fundraising, giving,
volunteering and The Big Society itself. Without a clear vision, simple and understandable
processes, and the necessary support and training for NFP organisations, the Government’s
strategy is unlikely to succeed.

_David Pinches is Director of Product Management and Marketing for [IRIS NFP Solutions](http://not-for-profit.iris.co.uk)_

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