DSC Asks: Jenny Willott MP responds

Jenny is the Liberal Democrat MP for Cardiff Central and party’s Shadow Chancellor for the Duchy of Lancaster – her role includes policy responsibility for charities and voluntary organisations

DSC’s questions appear in bold below; Jenny’s answers appear in normal text

If the Liberal Democrats win the election, and you become Third Sector Minister (or its equivalent), who would your first three meetings be with?

I would try to meet a range of organisations to get an up-to-date briefing on the key issues facing the sector, taking into account the results of the election.  I would arrange a couple of small group meetings, one with small community charities, one with larger UK wide organisations and one with social entrepreneurs.  
What do you propose to do about the following:

• Irrecoverable VAT – In the current financial circumstances, we would be unlikely to change the rules relating to VAT early in a new Government.  However, we have other commitments that would provide additional sources of funding for the Third Sector which would in part offset irrecoverable VAT.  For example, we would reform Gift Aid as laid out below, and would reduce other areas of regulation to free up resources in the sector.  We are also committed to reducing VAT to the lowest level possible in some areas which would benefit charities.  For example, we would reduce to 5% VAT on repairing and renovating old properties.  This would lead to huge savings on projects and make investing in renovations for community purposes more affordable.

• Payroll Giving – This is an important source of funding for the sector and we would encourage the private sector to become more involved in the work of the Third Sector, both through supporting payroll giving, but also encouraging employee volunteering and the building of long term relationships between the sector and business.  We would lead from the front by ensuring that all of the public sector encourages payroll giving and encourages their staff to volunteer.

• Gift Aid – Within one year of taking office we would introduce a new, simpler administrative system for Gift Aid, to encourage and make it possible for smaller charities to access funds to which they are entitled, but which currently few of them claim.  We would also introduce a composite rate of Gift Aid, probably around 23%, and remove the right for higher rate taxpayers to claim back higher rate tax on donations.  However, I recognise that some charities are concerned about the impact of this on some large donations, and would consult further on the exact mechanics of the new scheme to ensure that by assisting the vast majority of charities we don’t inadvertently harm a few.

• The Compact – The Compact sets out an important set of principles that underlie the relationship between Government at all levels and the Third Sector.  However, it only has value if it is properly implemented and the real problem is that too often this isn’t happening.  We saw a scandalous example of this when the Office of the Third Sector itself diverted funding away from the Campaigning Research Programme into the Hardship Fund.  This money had already been allocated to charities and the decision came with no warning or consultation. This runs completely counter to the main principles in the Compact.  As a minimum, central government has a duty to set an example to all other public bodies when dealing with charities.

How would the majority of voluntary sector organisations that receive no grant or contract income benefit from a Liberal Democrat government?

I have already mentioned our proposals to make Gift Aid more easily accessible and at a higher rate, which would benefit these organisations, as well some reductions in the regulatory burden borne by charities. 

In addition, there are many ways that the Government can support the sector which don’t include direct financial support.  These include capacity building support, support for infrastructure bodies, such as volunteer bureaux, who in turn provide essential support services and training to local voluntary organisations.

On a national basis, a Lib Dem Government would work to achieve a cultural shift in attitudes about volunteering, starting in schools encouraging young people to start volunteering early, and continuing to encourage employers to build long term relationships with charities and the sector, both to enable financial support, but also to increase dramatically the number of employee volunteering schemes across the country, leading the way with the public sector.     

How would life under a Liberal Democrat government be different for campaigning charities?

The Lib Dems believe that campaigning by charities is a crucial part of our democratic system.  The main focus of most charities is service delivery and should remain so, but the reason charities have such a powerful voice is that their campaigning comes out of experience and is backed up with evidence from their service delivery. 

Unlike the Conservatives, the Lib Dems believe that our political processes and decisions are much enhanced by charities' research and campaigning.

How will Liberal Democrat policy support and improve relationships between local government and local charities and voluntary organisations?

The Liberal Democrats have been championing localism since we were first established.  Indeed, this founding principle is written on the back of every Lib Dem membership card. 

Devolving power from the centre to local government, communities and individuals opens up a whole range of opportunities for voluntary organisations.  However, there are issues in the way different local authorities work with and treat local voluntary organisations.

There is real potential to deliver responsive, high quality public services which take into account particular local needs, but this requires good working relationships and a genuine understanding on both sides of the way the other works and the challenges each faces. 

We would work with local authorities to ensure that the terms of the Compact are implemented at local level and that strong local relationships are built.  Through organisations such as the LGA and IDeA we would encourage the sharing of best practice and training for local councillors and officers on how best to work with local organisations and get the most out of the relationship on both sides.

What do YOU think?  Email your thoughts to Jenny Willott at jenny@jennywillott.com

Click here to read Nick Hurd’s responses to DSC’s questions

Click here to read Angela Smith’s responses to DSC’s questions