Mr Major’s Address to the Charities Aid Foundation – 5 November 1991
Below is the text of Mr Major’s address to the Charities Aid Foundation in London on Tuesday 5th November 1991.
PRIME MINISTER:
I am delighted to have the opportunity today, I am delighted also, if I may say so, to see so many people here who care so deeply about charities; but I am delighted to have the opportunity today to review the government’s policy to the charitable sector and to look ahead at what the future may hold for that sector.
Before this audience of course the role of the voluntary sector needs no defence whatsoever. But alas even in this day and age not everyone recognises the sector’s scale and diversity. And there are still some people, for a raft of different reasons, who still see private charitable activity as a public shame.
I believe, frankly, that that is a nonsense and I am glad that such negative attitudes are now clearly on the retreat. Because the truth I believe is becoming more and more widely accepted that public provision could never replace the immense contribution of voluntary action, it never could and actually it never should. Voluntary action is often at the frontiers of what even the richest and most benevolent state could possibly provide.
It improves the lives of those people who are helped and in doing so I believe it also fulfils the lives of those people who do the helping. That is not of course the primary purpose of charitable activity but I believe it is one of the practical aspects of charitable activity that we ought to acknowledge and to welcome.
There are at the moment across the country about 1 million people involved in managing voluntary activities. Tens of millions more give time or money or often both and tens of millions of our fellow citizens benefit either directly or indirectly from the activities of the voluntary sector.
And I believe it is worth just a moment or two to try and put that in context. Just try and imagine what life would be like without charities, how many children I wonder might be left at risk without the NSPCC. How many hundreds of thousands of people abroad would have no hope whatsoever without Christian Aid? How dark and immobile would life be for many people without sight without the Guide Dogs for the Blind Association? And I wonder how many lives would be lost at sea without the remarkable activities of the RNLI. And just imagine, imagine the anguish of so many people if they could not pick up the phone in need and speak to the Samaritans.
I think it is worth just reflecting on the impact that has on the quality of life and the nature of society we have in this country. We refer to the voluntary sector. But in a sense voluntary sector is a misnomer, it is not a sector, it cannot be a sector because it permeates everything. What it is, because of the scale and diversity that it has now reached, is a part of the very fabric of the whole nation.
I have not a shred of doubt about the value of the efforts of all volunteers. Charities are not, and should not be seen, as the sticking plaster on welfare state. The activities of volunteers should be seen in a different activity, they should be seen as part of the cement that actually binds our society together. They are a very part of its stability and they give people the chance to deploy their skills and develop their potential. And wherever possible, everyone should have the opportunity to develop their abilities to the utmost and charities help them to do precisely that.
There are of course a vast raft of ways of meeting society’s needs. Some are best met by individuals, others by business, some by government. But alongside all of these, voluntary bodies have a vital role, they are close to people’s needs and they can respond quickly and flexibly to changing circumstances.
And I think there is a further point often overlooked by people. There are many people, proud, independent, perhaps in need of some assistance of some sort who are far more inclined to accept that assistance from the voluntary sector than they ever would be prepared to accept it from the government, but they need that help and the voluntary sector provides it.
And I think it is worth looking at some of the voluntary organisations and what they have done. It was, for example, voluntary organisations that responded first to the victims of crime, victim support schemes began in Bristol in the 1970s and have burgeoned since then, they met a need that clearly was there.
It was voluntary organisations that first pioneered the care of AIDS sufferers, something that many people would have pushed aside a little while ago, but it was the voluntary sector that identified the need and began to do something about it.
And it was voluntary organisations and the VSO and community service volunteers that first grew from the ideas of just one man – Dr Alec Dixon. And I think that is an important point and the point is clear, voluntary bodies do not just help, frequently they innovate as well and are ahead of the problems that government agencies of all sizes, under whatever government, often have not yet spotted and are often not in a position to deal with.
I believe that is a very important role for the voluntary sector and in the future we will be calling on that innovatory approach in the Children Act, implemented just last month. For the first time ever all concerned will be obliged by law to listen to the child’s voice, the voluntary sector will be fully involved in the planning and provision of services for children. And the act, again for the first time, places on the statute book the role of the NSPCC in investigating children in need of protection in parallel with statutory and other voluntary agencies.
I doubt whether anyone, anyone, knows accurately how many voluntary bodies flourish in the United Kingdom, but registered charities are measurable and are growing fast. In just 10 years, 30,000 more actually came into being. There are now 170,000, they come in all shapes and sizes from large organisations which employ professional staff to small local self-help groups.
I am immensely proud personally, and I believe we can all be immensely proud as a nation, of the fact that nowhere else in the world is there such a spread and depth of charitable activity.
In whatever we plan, the needs and ideas of the small groups must not be overlooked. Many of the little battalions are doing a big job with small resources, providing valuable services to people in their local community. But through all this activity, all this diversity, there is one consistent golden thread that runs continually. All those charities in their different various ways aim to improve the quality of life in one way or another. And so for those reasons I have no doubt whatsoever about the place of the voluntary sector in our society.
Let me say a word abut how the government sees that. The government wants a positive relationship with the voluntary sector, it wants to encourage it, it wants to support it and yes, from time to time, it wants to learn from it as well. There are of course difficulties in that relationship from time to time as there are in any relationship outside of fairy tale, but nonetheless we need to develop it and we intend to develop it.
I would like to see the development of clear cut relationships, embodied where possible in contracts, so that each party knows where it stands. And I do support a move towards longer term more stable patterns of support. Voluntary organisations, like businesses, need stability in order to plan their own activities and their own future. And every hour spent negotiating in Whitehall or the Town Hall about your grant is an hour not spent helping others doing the very work for which the organisation was formed and for which it is most suited.
But as we work for greater clarity, as we implement the results of last year’s efficiency scrutiny of government funding of the voluntary sector, we must be careful not to replace one problem with another. In the 1990s, I want to see the voluntary bodies established ever more firmly as a powerful independent force in our society.
The truth is that charity has no bounds of class or wealth or race, everyone can be a donor, everyone can give time, everyone benefits directly or indirectly from their activities. As Ralph Barendorf has put it, the strength of the voluntary sector is an index of liberty. The voluntary sector is very strong indeed in our country, the right of people to associate in a common interest or in the interest of others is a fundamental freedom and a fundamental good.
I cannot possibly hope to cover today the myriad aspects of the voluntary sector’s role or its relationship with government and I daresay if you thought I would I doubt many of you would have volunteered to be here today for it would have taken a very long time.
But perhaps I can in the time available to me single out three specific areas: first, the legal framework; second, financial support; and third, what we in this country can do for others.
There is a crucial component in promoting charitable giving and helping the sector to expand still further. And it is quite clear, and one I know that is dear to your hearts, charities must be seen to be well managed and well regulated. Bad publicity about one charity is often bad publicity for all, doubt can spread like a canker when a charity goes wrong.
People who do not really want to give use it as an excuse not to give, so donors must have confidence that their money will be used wisely and well and with accountability. And this is something of which the voluntary sector has long been all too aware. You have made it clear to us on many occasions that you did not see more effective regulation as a threat to charity, and nor is it. Indeed you saw it as a precondition of continuing success and I believe you are right in that judgment.
We have tried to respond to those concerns. In recent years we have discussed with you a new approach to the regulation of charity, one that offered to maintain the high standards while limiting unnecessary bureaucracy. With your help I hope and I believe that we have found the right balance.
And so we are publishing today, as your Chairman mentioned a moment ago, a Charities Bill which I know has been keenly anticipated inside the voluntary world. This bill will be a centre-piece of the coming Parliamentary session, it will provide a statutory framework for the proper management and the public accountability of charities.
I particularly commend the Bill’s four main themes: first, enhancement of the Commissioner’s ability to obtain information about the management of individual charities; second, where necessary, powers for the Commissioners to act speedily if they detect abuse; third, and critically important in many ways, clarification of trustees’ responsibilities, we do not intend to burden trustees unreasonably. I know the effort which goes into running charities and it is enormous, bureaucracy must not be in the business of stifling benevolence, but trustees have responsibilities to the public too, the vast majority of them fully recognise this, a few may not and we must ensure that they do not damage the reputation and activities of the majority.
So the Bill will therefore build in a legal foundation for the maintenance of good accounting practice in charities and it will ensure that anyone can obtain a copy of the charity’s accounts.
The fourth theme of the bill, is the tightening of control over professional fund-raisers. Their invention and their energy have been of immense value to the charitable sector, but a very few unscrupulous fund-raisers have abused the reputation of the rest of you, so the Bill will regulate the activities of professional fund-raisers to offer greater confidence to the public at large.
And our aim in this is not to tie up people in red tape but to open wider the floodgates of giving by ensuring even greater public confidence in charities themselves. I know that the voluntary sector understands the need for public confidence. The NCVO and the charity commission have set up a working party to look at improved support and training for trustees, the government has given the Commission an effective capacity for investigating and correcting the abuses that undermine public confidence, and above all the opportunity to reconstruct the Register of Charities. I hope that this programme will deliver a system of regulation and support for the charitable sector which will be unequalled anywhere in the world.
At present, Mr Chairman, the government provide substantial direct support for charities amounting to almost 2.4 billion pounds. Direct grants to voluntary organisations account for some 373 million, a figure well over double what it was ten years ago even when one takes account of inflation. But even more significant I believe is a revolution that has been brought about in the opportunities for people to give. Covenants have been made more attractive and more flexible; the pay-roll giving scheme has been introduced and I very much welcome the new campaign led by Russell Twisk on behalf of Readers Digest to extend it and I want to see public bodies try harder to promote this particular concept of giving; and all bequests to charity, all bequests to charity, have been exempted totally from tax and again I welcome the recent campaign to highlight the importance of making a will and remembering a charity when you do so, where there is a will there is a way and that way is the route to greater giving.
So our policies of wider ownership are yielding richer fruit year by year. I want to see charities get a good share of the wealth that is now beginning to cascade down and across the generations. And finally, as you kindly mentioned it yourself, Chairman, perhaps I might mention gift aid which provides tax relief for single deductions of 600 pounds or more by individuals and by companies. I was pleased to introduce this scheme when I was Chancellor, it had long been asked for, and I hope it is proving useful. And I have been far more pleased to see its growth, even in its first year, charities have already claimed tax refunds of over 35 million pounds on donations of almost 110 million.
Total tax relief therefore for charities, including income tax repayments, currently amounts to more than 800 million pounds. So in these ways I have outlined we have sought to encourage giving and have provided both mechanisms and incentives for people to give. And I know the voluntary sector will follow that through and encourage them to give as generously as they can. I hope they will do so for that generosity will go to a good cause.
I read with very great interest the statistics in the Charities Aid Foundation’s charity trends document. As Chancellor I probably had more opportunity than most to pour over Dryers Duss statistics and I came became perhaps too much of a connoisseur.
But the charity trends are different and the Foundation I believe does us a very great service in bringing these figures together. I know that they show a decline in the levels of typical giving over the year just past. I am unsurprised by that, quite frankly, it is inevitably one consequence of a recession such as the one from which we are now beginning to emerge. And it does illustrate another point, it does illustrate how very important it is that the battle against inflation succeeds and that inflation stays down and that we do not have another recession of the sort we are just emerging from. We saw during the 1980s a very strong growth in both personal and corporate giving, I want to see that growth begin again in the ’90s against the background of a stable, growing economy, and that is what I believe we are now on target to produce.
And as growth in giving returns it will be partly because of the framework the government has provided, but it will be for another reason as well. It will also be because of what the charities to do to promote the ideal of giving itself by individuals, by companies and by institutions too. And I greatly welcome what Willie Whitelaw and the Council of Charitable Support have done to promote giving and I welcome too the birth of the Windsor Group, I understand that are now discussing a campaign to promote the principle of charitable giving itself, a discussion I will follow with very great interest. And we will do what we can to help that campaign succeed.
I should like to stress here today the very great importance I attach to charitable giving by business and by industry. This country does have a proud tradition, the Rowntrees, the Cadburys, the Port Sunlight ventures, all have a resonance which still speaks to us. I know that many companies today recognise their responsibilities to the local societies in which they are based and to wider society generally.
And in recent years that recognition has grown and I hope it will continue to grow, we will do what we can to encourage it. At the risk of being invidious, I would like to mention in particular the work of Hector Laing and his colleagues who subscribe to the percent ideal, an ideal perhaps familiar to you, perhaps not, but an ideal whereby a company devotes one percent of its annual profits to charity.
Enlightened capitalism has a long history in this country, I am sure it has an even longer future and an ever improving one and we will join you in seeking to ensure that that comes about.
If I may turn, just for a moment, from home to abroad. I welcome the very heart-warming contribution which British voluntary organisations make in developing countries and not only in times of disaster. In more humdrum times too voluntary bodies attack the root cause of under-development through long-term projects which give poor people the means to be self-sufficient.
The overseas work of the voluntary sector should not be forgotten and it has grown dramatically and we have recognised its value. Last year British voluntary organisations received grants of over 88 million from the Overseas Development Administration, an increase of 35 percent on the previous year.
And the needs of the poorest most heavily indebted countries are acute and require urgent action. In Harare I was glad to announce that in the absence of full agreement in the near future in the Paris Club of creditor countries the UK will implement the Trinidad Terms initiative on enhanced debt relief.
And the effect of that I think is dramatic, it will reduce debt by around two-thirds for eligible countries undertaking economic reforms and if we can persuade all creditor countries to implement the initiative it will be worth 17 billion dollars to the poorest countries in the world, the largest debt write-off in history and in my judgment it is not a moment overdue.
Mr Chairman, the government is absolutely committed, no-one should be in doubt about that, absolutely committed to sustaining the success and growth of voluntary activity in Britain. We have a good model in this country but some proposals made in Europe in the past have shown little appreciation of the fact. And like so many institutions in Britain, the framework of British charity law sometimes does not look logical, but it does work, and I am pleased that some of the potentially damaging ideas once canvassed in Europe seem to have been laid aside. We will be vigilant to see that they are not revived in Europe in the future.
The framework now being considered by the Commission to help voluntary bodies operate in other countries may well provide a reasonable basis for progress, we will negotiate to ensure that framework is right.
But I see no reason to be defensive about our own position. I want us to take the initiative in discussion, to encourage our form of trust law, our forms of regulation, our forms of citizen involvement elsewhere. If the Charity Commission is a good way to do things then let us have more of them. And when we take the Presidency of the European Community next summer I shall want to examine whether we should make the development of voluntary activity a significant part of our programme during our Presidency.
An active voluntary sector has been persecuted and restrained in one part of Europe for close on 50 years. In central and Eastern Europe people are now struggling to build up voluntary organisations, they lack experience, they have no know-how, they confront attitudes of suspicion and leave it to others’ mentality that generations of state centralism have engraved.
If you believe, as I believe, that voluntary bodies are part of the bedrock of a democratic society, then you will, want to do all you can to help them grow in the East. Some of you I know are already doing that, it is not just bankers and businessmen that you find in the conference rooms of Prague and Budapest, it is charity trustees as well that you will find in those very same rooms.
President Havel has spoken of the need to create a civil society. we can help him, and others, to define a space, a safety zone, between the individual and the machinery of the state. I am therefore delighted to announce today the setting up of a new voluntary sector skills scheme – the Charity Know-How Trust. This is a special fund to which trusts and government will contribute in equal proportions. It will enable British expertise in the field to be channelled to where it is most needed, it is a seed-corn scheme which should enable a rich harvest to flourish. It will be available for all countries eligible to receive assistance from the Foreign Office Know-How Fund. I am delighted that the Charity’s Aid Foundation is providing the administrative back-up.
Through it, and through your own independent efforts, British voluntary organisations can help to weave the fabric of a free society in each country which takes part, you will be strengthening the new democracies of the East and there is every reason to do that, military, socially and economically, to build a safer future for us and our children and for everybody else in every part of Europe.
When British voluntary organisations help their new counterparts abroad, it will be in the central tradition of voluntary organisations themselves as volunteers, out of public spirit, not for private gain. The people involved in voluntary activity are usually modest, often anonymous, they do not seek our praise but they deserve it no less.
I hope, Chairman, that my presence here today will help to underscore the government’s respect for this sector, I am glad that there is already very active dialogue between many government departments and the voluntary sector, I want to see that dialogue widen and deepen in the 1990s.
For this government wants to support and promote more charitable giving, more volunteering and more business involvement in local communities throughout the United Kingdom. And we recognise that donations in time, or in kind, are just as important as donations in cash. We want to see more grant-making trusts set up in the 1990s, a very valuable contribution which wealthy individuals can make towards supporting voluntary organisations. We want to see more use of the tax-efficient measures designed to encourage charitable giving. we want more recognition of the needs of smaller, lower profile organisations. We want more recognition of the contribution of volunteers and we want more of the fruitful partnerships which began to emerge in the 1980s and which could benefit all concerned, the individual or company, the organisation and the wider community they serve.
If, Chairman, if we succeed in those aims, many millions of people who look to voluntary bodies for support or who find greater personal fulfilment through them, will feel and find that their own lives are enriched.
The outcome of that will be clear, it will be I believe a society which is increasingly enriched as well, that must be the aim of all of us. I know that is the aim of the voluntary sector, you may count on the government to support you in it.