This year’s Budget is more middle of the road

Every year, when the Chancellor stands up to speak, you get a sense of a set of dice settling in the cup. Is this going be a good Budget for the voluntary sector? Because despite all the predictions and expectations, it’s pretty much down to a dice roll whether a Budget turns out well.

Even when – like this year – the sector knows of some charity-specific measures likely to be announced, those measures can always be dwarfed by wider policy changes and ill-thought-out surprises.

Last year was pretty close to a snake-eyes Budget for the sector. There was a deeply problematic tax on giving, the end to another tax relief worth tens of millions, and an austere environment likely to cause deep-seated pain to the sector’s beneficiaries.

So where did this Budget end up? Have we got double sixes this time round to compensate?

Well, no. It’s something more  middle of the road, like a five and a two.

In sector specific terms, there was more good news than bad.

There were two announcements we’d half expected and half hoped-for: consultations on a tax relief for social investment, and on a package of Gift Aid reforms including a universal Gift Aid declaration. And there was one rabbit out of the hat: the employment allowance, which offsets the first £2,000 of employer’s national insurance, which is supposed to be worth £45m a year to charities, and is particularly useful for small organisations taking on a first member of staff.

There was a change to pensions rules which looked pretty obscure, but which is likely to cost up to £30m a year for the already beleaguered charities in multi-employer defined benefit schemes for whom, I have to say, I feel very sorry indeed.

This all adds up not to a massive boost to the sector’s economy, but a step in the right direction, with a lot left to fight for during the two forthcoming consultations. Past consultations on new reliefs have shown there is a hell of work to be done to make sure the government introduces changes that are effective, intelligent, and beneficial to the sector.

(There is also one other note of caution, which is that there’s a history of the biggest issues remaining hidden in the Budget documents for two or three days. One issue I have my eye on is a “general anti-avoidance rule”, because the terms ‘anti-avoidance’ and ‘massive problem for charity’ have often been synonymous in the past.)

There is also one major negative to this Budget, as with the last couple before them: it suggests that for even longer than was previously thought, we will face an enormously difficult environment for the sector’s beneficiaries: the poor, the vulnerable, the disabled.

Facing that sobering thought, it’s difficult to get too excited about digital giving reform and social investment tax relief, whatever they end up looking like.

– Read our Big Issue on how the Budget will affect the sector