Funding Update - February 2007

CHARITIES ACT 2006

The much delayed Charities Act was eventually passed in November; it is intended to remove a few levels of bureaucracy and increase flexibility for charities. A few of the points that relate to finance are briefly described below but all charity trustees should acquaint themselves with the new requirements – the summary on the www.charity-commission.gov.uk website is a good place to start.

- ‘advancement of environmental protection or improvement, for the public benefit’ is a legitimate charitable purpose;
- only charities with annual income over £5,000 need to register with the Charity Commission; for charities below that threshold it will be voluntary;
- charities with income below £10,000 will have greater freedom to change their purpose, transfer assets to other charities, amend rules, spend the capital from permanent endowments and take certain other actions without needing the Commission’s prior permission. Larger charities will have a limited amount of extra flexibility in this area too;
- the Commission will keep a register of charity mergers, so that any donations or legacies made to a charity that has ceased to exist through merger, will automatically pass to the new merged charity;
- charity trustees cannot be paid for being a trustee; they can be paid if they provide additional services to the charity (eg a plumber who provides plumbing services) and so long as the other trustees believe it is in the best interests of the charity to do so, they do not need prior permission from the Commission. Certain other conditions may apply;
- trustees can now apply to the Commission for relief from personal liability for breach of trust, so long as it was not deliberate and the trustee acted honestly and reasonably;
- trustees can take out indemnity insurance using the charity’s funds, so long as the charity’s governing documents don’t forbid it.
- There are new rules on when charity accounts need auditing or examining, as detailed below;
  Non-company charity Company charity
(a) Professional audit Income>£500,000 or
Assets>£2.8m & income>£100k Income>£500,000 or
Assets>£2.8m
(b) Independent examination    between (a) and (c)   n/a
(b) Accountant’s report    n/a   between (a) and (c)
(c) Nothing Income<£10,000 Assets<£2.8m & Income<£90,000

- where charities employ a fundraiser, the ‘solicitation statement’ which the fundraiser must give donors to say that he/she is getting paid by the charity must now state what amount he/she is getting paid. Slightly different rules apply to employees and officers of the charity, but there is no parallel requirement for volunteers (who presumably aren’t getting paid anyway !)
- A new Charity Tribunal will provide a facility to appeal against Charity Commission decisions without having to take the case to the High Court.

HERITAGE LOTTERY FUND

The HLF/IWA Conference at Austin Court in Birmingham in November seems to have been well received by all attendees. Presentations from the conference are available to delegates, on a CD from IWA Head Office, but if there were two messages that I took home it was that (a) HLF like canals, and (b) they do not expect the 2012 Olympics to have a significant impact on their ‘budgets’.

The latter point seems to be a bone of contention for the Culture, Media and Sport Select Committee, and if the Olympic costs continue to escalate then one can only think the pips will begin to squeak. Shortly before the conference, a HLF spokesman had indicated that HLF expected to lose £143m overall to the Olympics, mainly after 2009.
 
EVERYCLICK

A modest little way of bringing a few pennies in is to get your members to use Everyclick as their PC search engine. Anyone who goes onto the www.everyclick.com website can personalise the Everyclick search engine with a registered charity of their choice. Not only does your favourite canal society’s name appear on the search engine’s main page each time you go to it, but every time you do a search, Everyclick agrees to make a donation (albeit a very small one) to the society. You can even monitor how much you’ve raised for them. Even if you are a committed Googler, you can set Everyclick up on your Start Up menu and then do a search for Google – its only a couple of extra clicks on the mouse to access your ‘favourite’ search engine, but another penny(-ish) to society funds.

IT’S YOUR COMMUNITY …

… is a new grants scheme from The Conservation Foundation and mobile phone giants O2. Grants of £1,000 are available for local environmental schemes and “renovating neglected river and canal towpaths” is specifically cited. Guidelines are on the website www.conservationfoundation.co.uk and application forms can be obtained via the website or from any O2 store.

FUNDRAISING GUIDES

Lewis Clare are professional grant administrators to whom some large funders outsource the donkey-work of sifting through grant applications, monitoring and evaluation of projects. As such they should be pretty good judges of what makes a good grant application, so their free 7-page ‘toolkit’ guide to securing grant funding might be worth a read. It’s not rocket science but to the relative beginners it’s a good framework to build upon. The guide can be downloaded free from their website www.lewisclare.com.

Nothing at all do with Lewis Clare is ‘The Sourcebook’ available from Fundingagents.com at a cost of £16.95 and getting plugs in a number of places. If you come across the blurb you may well be enticed by the promises, but my personal advice is to hang onto your money; unless you are an absolute novice, its contents will almost certainly tell you little about where to access funding that you didn’t already know.

Another free resource is the Introductory Pack on Funding and Finance on the Finance Hub website – www.financehub.org.uk/?download=fundraising.pdf. Like the Lewis Clare guide, this is more for getting you in the right mind-set to approach would-be funders with your project, than just another rearranged list of the top few dozen funding bodies. Its freely-downloadable fifty pages include sections on tax-effective giving, legacy fundraising and payroll giving.

SITA TRUST

SITA UK are one of the larger landfill operators, and their trust body SITA Trust recently launched a new small grants scheme, under the auspices of Landfill Communities Fund, that specifically targets -amongst other things - historical buildings and structures. Their Enhancing Communities scheme covers projects within 10 miles of a SITA landfill site, with the fast-track small grants scheme covering awards up to £10,000, but they also have a Large Grants scheme (up to £50,000) and a Challenge fund (three awards annually of up to £250,000). Comprehensive guidance and criteria are given on their website www.sitatrust.org.uk.

The Landfill Communities Fund (formerly Landfill Tax Credit Scheme) was 10 years old in October and has distributed more than £700m in that time and has helped lever in a further £2bn of European, lottery and central government money to the 19,000-plus projects it has supported.

MORE SCAMS TO WATCH OUT FOR

I have previously alerted readers to scams where charities are sent cheques that incorporate a convincing ‘payback’ request. Your payback payment goes through of course, but the initial cheque unsurprisingly, bounces. There are now two email scams to be aware of. Bogus emails from HM Revenue & Customs are being sent to charities asking for bank details in order to pay a tax refund, and bogus emails from Charities Aid Foundation are being sent, advising charities that they have been awarded a grant, and again asking for bank details. The ‘real’ HMRC and CAF have confirmed they would never ask for bank details by email, so please do not fall for it.

Andy Screen