Givin' La Vida Loca; Joe Saxton's 12 ways to increase donations over the next 10 years
There has been a lot of talk about increasing giving and much debate about creating a giving culture in the UK. There are even some who say there is little left that can be done to increase giving across the sector. Well, that’s just not true and here are my ideas for increasing giving in specific and practical ways over the next decade.
1. Relax charity/society lottery regulation
Lottery regulation stifles the amount that charities can raise from lotteries. The 80:20 rule dictates that 20% of every lottery draw should be profit and this makes it all but impossible to start a new one from scratch. Imagine if the government said that 20% of the income of every company must be profit. This is what the regulations say for every single charity lottery.
The solution is not to scrap the rule, but to allow it to be spread over time and across all a charity’s lotteries. There are a host of other ways in which these lotteries are suppressed, but I’ll only mention one more…
2. Allow gift aid on lottery tickets
Charities can’t claim gift aid on the income from lottery tickets. The rationale behind this is donors aren’t eligible for gift aid if they receive a substantial benefit from their gifts, which in this case would be a prize. However, those that don’t win a prize don’t receive anything, so why can’t they get gift aid?
The HMRC rule actually says that a donor can’t get a benefit worth more than 25% of the value of the gift. So, provided the aggregated prize fund was less than 25% of the total income of the lottery, charities should be able to claim gift aid. This would also reflect the reality of what is in people’s heads; they are motivated by the desire to help the charity as much as by the desire to win a prize.
3. Change corporate gift aid
Up until 2000, charities used to get the gift aid from the corporation tax from corporate donations. The government then changed the system and gave the tax back to the company. The idea was to stimulate companies to give more. The problem is that even if 25% more were given, the net impact on charities would only see them back where they were before the change took place.
A cursory (but only a cursory) look at the figures to date would indicate that there has been no explosion in giving by returning the tax to companies. So let’s do the research and create a watertight case to change the system back to that of the last millennium.
4. Do a proper feasibility study on lifetime legacies
I have long been critical of the hype of lifetime legacies and those who say it could make a real difference to giving. Rather like the wonders of Shakespeare and Downton Abbey, I just don’t get it. What really niggles me about lifetime legacies is that nobody has done a proper feasibility study on them.
A research-based report setting out what is being proposed and how the scheme might work would probably allow an evidence-based debate, rather than a hubris-based one.
5. Form a commission on personal gift aid
I realise that there have been a myriad of consultations and proposals on gift aid, yet little has changed. One of the problems is that there are as many ideas as there are infrastructure bodies, and often the ideas directly disagree.
I suggest the sector creates a Commission with representatives from all the major players and creates a structure which gets the organisations to agree to support all the key recommendations.
6. Explore financial services
There is a large amount of money that the financial services industry makes each year through the commission given on the sale of services (though technically it is now called something else). If charities were able to earn a small slice of that ‘commission’ income, it could be worth a lot. A number of charities like Diabetes UK and Age Concern (as was) have carved a distinctive niche, but there is a need for a thorough review of this income stream’s potential for charities.
7. Create community-owned challenge events
There are plenty of national-scale charity events. Most are run by individual charities, but some are run by third parties, such as the Great North Run and the Royal Parks Half Marathon. Events like these two let individual charities fundraise on the back of another’s hard work.
We need more events where individual charities can fundraise easily by benefiting from large events with a critical mass of profile and marketing expertise. Indeed, I’d go so far as to say that every town should have one.
8. Build awareness of the work of the Charity Commission
Trust in charities is a key precursor of giving. If people don’t trust a charity, they won’t give to it, so maintaining and building trust in charities is important.
I think one of the key components of that is for people to understand the breadth and depth of the work of the Charity Commission. The more people understand how the Charity Commission scrutinises and regulates charities (along with other bodies), the more I think they will feel reassured. It needs to be every charity’s goal to promote the role of the Commission.
9. Fundraisers need to work with the philanthropy community
The fundraising community and the philanthropy community are like two grumpy siblings. They have a lot in common, they share common aims but they don’t work together well. Indeed, they often prefer to pretend the other doesn’t exist. If these two parties could work together better they could do so much more than their largely separate endeavours.
10. Charity fundraisers need to work with the arts, heritage, culture and education fundraising sectors
Just as fundraisers and philanthropists don’t work well together, those in the world of charity fundraising barely talk to their counterparts in the arts or education sectors. Again, this is simply a missed opportunity – there is so much they could learn from each other. And usually when fundraisers learn, they think up new ways to raise more money. That can only be good.
11. Build fundraising skill-share networks
We have just done a research report on the ways that hospices could work together to raise more money. A key ingredient of this was the opportunity for like-minded, non-competing organisations to share experience and skills. Are there other organisations that share these features?
Well let’s start with churches, parent teacher associations, further and higher education institutions, museums, galleries and many local charities. ‘Skilling up’ networks could help organisations raise more money.
12. The real fundraising challenge is small charities
Fundraising as a small charity is really tough. Small charities struggle to have the economies of scale in their fundraising that keep costs down and facilitate learning. They can’t afford to risk innovations that might not work and they struggle to create a brand that will make their fundraising messages more effective.
This point is one where I have no easy solution, but if we want grassroots and specialist charities to flourish, we need to work out how to crack the challenge of fundraising on a shoestring.
I am sure other people have great ideas about increasing giving (and please post them in the comments below). The real challenge now is how to turn these ideas into action.
Joe Saxton
We'd love to hear your ideas on raising more money, or if you think it can't be done. Leave us a comment below.
Image used under creative commons license, thanks to HowardLake.