In a budget in which the Chancellor seemed to go on a spending spree to fix the UK and deliver on the promises to the British people by “getting it done”, the current virus situation was at the fore.
Although there was a lack of charity specific measures which was disappointing, a number of funding pots have been announced together with other general measures that will have an impact on the sector.
The Chancellor high-lighted the support that would be available to the NHS, business and individuals in light of COVID-19 and from a charity perspective the following aspects are relevant:
- charities with less than 250 employee’s will benefit from a reimbursement of statutory sick pay paid to employees who have self-isolated for up to 14 days;
- expanded business rates relief which will provide benefits to charity shops, museums, galleries and theatres;
- a hardship fund of £500m of new grant funding will be provided to Local Authorities to support vulnerable people and households.
At last some common sense as the Chancellor extends zero rating for newspapers, magazines and journals to e-publications. The Chancellor suggested in his speech that this would have wider application and so it is hoped that it also applies to charity newsletters and the like. In other VAT news, the VAT registration threshold remains at £85,000. The government has also said that it wants to make the most of the UK leaving the EU to make the VAT system more business friendly. The removal of the VAT from women’s sanitary products is a first step in this process and it is hoped that we will see more targeted measures to benefit the sector.
The increase of the employment allowance from £3,000 to £4,000 from April 2020 for charities with NI bills of less than £100k is small fry when compared to the increase of 6.2% in the National Living Wage from 1 April 2020, and the expectation that it will reach £10.50 by 2024.
Funding pots announced include; £643m has been provided for accommodation and support services to help people off the streets; £250m has been provided for a Cultural Investment Fund for culture, heritage, museums and neighbourhood libraries; £500m for a Youth Investment Fund; £27m for critical maintenance work on the National Museums’ estates; £29m for primary schools sports facilities and £90m to introduce an Arts Premium from September 2021.
A fundamental review of business rates has also been announced – let’s hope that the valuable charity relief is retained.
Sector bodies have previously called for the Apprenticeship Levy to be extended to volunteers and whilst this has not so far been forthcoming, the government have said that they will look to improve how the levy works.
