CFG Live Blog – General Election 2015

May 8, 2015 at 09:36

12/05/2015 – 19:00 – New Minister for Civil Society, Rob Wilson

Rob Wilson has been reappointed Minister for Civil Society.

It will be interesting to see if the Local Sustainability Fund will be put into place and whether the government will continue its focus on the social investment agenda.

You can see sector wide comments on this issue here.

12/05/2015 – 10:10 – New Exchequer Secretary to the Treasury (aka Charity Tax Minister), Damian Hinds

Damian Hinds, MP for East Hampshire, has been made Exchequer Secretary to the Treasury which is in charge of charitable tax reliefs. Damian is seen as a moderate and has worked substantially on issues of education and social mobility. He hasn’t spoken much about charities in the post, although he did raise concerns about the Charity Commission’s public benefit test in relation to denominational education (Church schools) in the last Parliament.

The big issues facing the new Minister (from a charity perspective) are upcoming changes to Gift Aid, the poor performance of the Gift Aid Small Donations Scheme and concerns around irrecoverable VAT. It’ll be interesting to see how the new Minister grapples with these.

12/05/2015 – 9:00 – Waiting for Godot & Europe

The Tuesday morning after the Friday before, and we are still waiting to see who will be take over responsibility for charity tax and be the new Minister for Civil Society.

However, it is likely that all this will be wrapped up before the end of today. To recap from yesterday, we know that the previous Exchequer Secretary (who was responsible for charity tax at the Treasury) has been moved, and we now have two new faces in the Cabinet Office – Oliver Letwin (overall in charge of the Cabinet Office and government policy implementation) and Matthew Hancock (who is charge of public service reform, driving through efficiency savings and civil service reform).

Last night also saw the appointment of Greg Hands as the new Chief Secretary to the Treasury, a close supporter of George Osborne and likely to be the man charged with finding the Chancellor the savings he promised to make in departmental budgets. You can read more about the divide between the Conservatives and other parties fiscal plans here.

The other big story is that the European Referendum may be brought forward to 2016 – although the Prime Minister had set himself a 2017 deadline. Whilst this may not directly impact on charities, it will certainly impact on the economy and will create uncertainty for investors. There is also the possibility that this will soak up of government focus, something for charities thinking about future campaigns to factor in.

11/05/2015 – 17:23 – Matt Hancock as Cabinet Minister for Efficiency & Reform, Ros Altmann, new Minister for Pensions

Matthew Hancock, previously Minister for Business and Enterprise has been moved to the Cabinet Office as Minister for Efficiency and Civil Service Reform. Hancock will be overall responsible for public sector reform, a key issue for public service delivering charities. He will also be in charge of transparency and will be the Charities Minister’s (if we have one) boss. Hancock is relatively unknown for the sector but it is likely that he will continue Francis Maude’s uncompromising approach to savings and driving through reform of the civil service.

Ros Altmann, previously a director of Saga and was a ‘business champion’ for older people for the coalition government, is the new Pensions Minister. Pensions are a big issue for the sector and CFG has been working hard to raise this up the agenda of charities, given the growing liabilities of charities as the workforce ages and asset values do not keep pace. As someone who understands the problems of failed pension schemes, she will be keen to push through reform to section 75 which CFG has been calling on for some time.

11/05/2015 – 15:00 – Pickles out of DCLG, Greg Clark in, Lewtin in overall charge of Cabinet Office

They are mounting thick and fast now.

Eric Pickles is out at DCLG and Greg Clark is in charge – he pioneered the City Deals in the last government and is a well known supporter of Localism. It will be interesting to see how he takes forward the implementation of local government spending cuts and projects such as Community Budgets.

Oliver Letwin is now made a full Cabinet Minister in charge of the Cabinet Office, which contains the Office of Civil Society. Oliver Letwin is seen on the ‘left’ of the Conservative Party and was a big supporter (excuse the pun) of the Big Society. However, it is unlikely to be the top of his agenda given the scale of central government cuts still to come.

11/05/2015 – 12:39 – A new British Bill of Rights

Many charities will be interested in the new Government’s approach to the Human Rights Act. It has been a long standing Conservative commitment to replace it with a British Bill of Rights.

This aims to “break the formal link between British courts and the European Courts of Human Rights, and make our own Supreme Court the ultimate arbiter of human rights matters in the UK.” This will be one of the toughest asks for the new Justice Secretary, Michael Gove, given the level of controversy that surrounds the proposal. It is also likely to get very rough treatment from the House of Lords where a number of notable ex-judges and legal experts sit.

Charities which have an interest in human rights will be clearly engaged, but as provisions of the act extent across a number of issues, charities engaged in areas such as as such as education and health, may also be involved.

It will be interesting to see how the new Justice Secretary engages with charities during the development of this proposal.

11/05/2015 – 10:30 – Sajid Javid new Secretary of State for Business, Innovation and Skills

Sajid Javid was prominent in the Conservative election campaign and is seen as a future Conservative leadership candidate.

He is close to George Osborne, but he has been striking out his own personality often based on claiming those Thatcherite values of thrift, hard work and supporting wealth creation.

From the charity perspective, it will be interesting to see how this policy treats social enterprise (many of whom are charities) and whether he will try to integrate social enterprise into the Conservative’s business strategy or whether this will be kept separated.

11/05/2015 – 10:12 – Priti Patel goes to DWP

Not quite as big an appointment as the papers had said, but Priti Patel is now Employment Minister at DWP. She’ll be in charge of the Work Programme 2.0 and which caused significant difficulties for charities working in this area last time around.

Officials have already been discussing how it could be improved, but as someone on the ‘right’ of the Conservative Party, it is likely that she’ll continue the trend towards tougher sanctions and more responsibilities for support, alongside keeping the costs of the programme down.

11/05/2015 – 09:50 – Awaiting new Ministers

Good morning, we’re back rolling live here at CFG.

You probably read over the weekend about the latest Cabinet re-appointments, but Ian Duncan-Smith has also been reappointed to his role as Secretary of State for Work & Pensions, so do not expect any changes in terms of welfare policies.

Priti Patel, the Treasury Minister currently responsible for charity tax, is likely to be moved with many papers tipping her for a ‘frontline’ role as a Secretary of State. So we can be pretty  much certain of change there.

We’ll be keeping an eye on the latest appointments that affect charities and how they might affect government policy throughout the day.

Any questions or queries, email policy@cfg.org.uk or leave a comment below!

08/05/2015 – 15:55 – All the seats done

Commiserations to Andrew George, a frequent supporter of charities in the last Parliament, who has just lost his seat in St Ives to the Conservatives – the last seat to be counted in this election.

Overall numbers show the Conservatives on 331, a majority of 12. Labour on 232, SNP on 56, Lib Dems on 8 and UKIP & Greens with 1 each.

We’ll be updated this blog over the next few days as more information comes in on the Ministers, and thoughts about the relevant policy areas so keep checking. If you have any views or questions, please leave a comment below.

08/05/2015 – 15:15 – Reshuffle

Looks like the main offices are going to be decided today (Chancellor, Home Secretary, Foreign Secretary and Defence) with the rest to be announced on Monday.

Make sure not to lose any sleep waiting for the announcement of the next Minister for Civil Society!

08/05/2015 – 14:00 – Social investment

It was never likely that the whole concept of social investment would be dropped by a Labour or Labour-led government, but social investment supporters will be relieved to see a Conservative majority given the strong backing that the PM and the government has given to the social investment market.

Social investment featured in the Conservative Manifesto and during the campaign Rob Wilson, the Minister for Civil Society, regularly mentioned social investment as a way to build capacity in the sector. I identified it as one of the ‘dividing lines’ of the election campaign. 

But where next for social investment? Speaking with those involved over the past few weeks, there is the impression that the next five years are a period of consolidation. The Access Foundation has just been set up and the Social Investment Tax Relief is due to be expanded (when state aid approval is given). Big Society Capital has come under criticism for being too slow to get its money out the door, so supporters of social investment will be hoping the next Government continues to let these institutions grow and evolve without interference.

For charities, we can expect continued investment in social impact bonds (as mentioned below) and I wouldn’t be surprised if there was another round of investment and contract readiness funding, given the positive headlines the last fund generated. However, there doesn’t seem to be much appetite in taking on the core issues such as the cost of capital and helping build up financial skills (particularly business planning) in the sector which will help to generate demand for loans. “Steady as she goes” appears to be the general feeling about how a Conservative government would handle social investment.

08/05/2015 – 12:51 – Reshuffle

NCVO have helpfully done a roundup of the winners and losers in terms of MPs from a charity perspective, which you can read here.

Of course, a new Government is likely to mean a new set of Ministers. One Minister, Ester McVey, has lost her seat meaning that even if he wanted to, David Cameron cannot keep his team unchanged.

Rob Wilson, the current Minister for Civil Society, has been returned with an increased majority as has Priti Patel, the current Exchequer Secretary to the Treasury (in charge of charity tax issues).

But will they stay?

Priti Patel has already been tipped for a top job in the next government after being rated a success in her public performances during the election campaign for the Conservatives. So it is likely that we will have a new Exchequer Secretary.

Rob Wilson, who was made Minister after the shock resignation of Brooks Newmark, is also unlikely to stay. Director of Policy at NCVO, Karl Wilding, has even broached the idea that there might not be an Office of Civil Society in this government – could that mean scrapping the ministerial post as well?

When will the reshuffle take place? David Cameron has just returned to Downing Street and is probably planning this now, I doubt we’ll get any information today but there may be a few leaks of high profile appointments.

08/05/2015 – 12:12 – Conservatives & English Devolution

During the campaign, I wrote a short blog on the Conservatives proposal for an English Income Tax which could have a big impact on charities.

Already there were concerns that the Smith Commission’s proposal would mean significant disruption for Gift Aid, the sector’s most important philanthropic tax relief, which has so far been linked to UK-wide income tax rates.

Although things would be complicated with Scottish and rest of the UK income tax rates, the idea that there could be Scottish, English and rest of the UK income tax rates will make things very challenging for the sector.

Constitutional reform on this scale is always very hard to get passed, and maybe the Conservatives won’t be able to achieve this (particularly given the small majority they have) – but one of the clear outcomes of the election appears to be greater awareness of the need to sort out the so called ‘English Question’.

Charities will need to make sure that their views and interests are not ignored in this debate.

08/05/2015 – 10:15 – Lobbying Act going to stay

Still a few seats to come in but looks like a Tory Majority is almost certain.

One area that it now seems clear there isn’t going to be major change (despite the asks of the sector) has been the Lobbying Act. Many organisations have called for its repeal and others for significant reforms, however, it is almost certain that a Conservative Majority government takes repeal of the Act off the cards.

Lord Hodgson’s ‘Third Party Review’ now looks like the only way that charities can call for significant change to the legislation.

CFG is collecting evidence on the financial cost of complying with the act and the administrative burdens that it has created in this election campaign. If you have had to change your processes, put in more work or spend more on monitoring then please email the policy team so that we can help raise these issues in the review process. Email policy@cfg.org.uk

08/05/2015 – 9:35 – What are the key Conservative policies that will impact on charities?

In what all commentators have called one of the most ‘unpredictable’ elections in modern times, we have managed to come up with a very unpredictable result. Despite all the polls indicating a hung parliament, it now seems clear that there is going to be a Conservative Majority or at least a much stronger Conservative Minority government than expected.

But what does all this mean for charities?

CFG produced a manifesto briefing for charities on the main promises of all the parties that affected charities – but for now, lets focus on the Conservatives. Here are three key areas that I think charities will need to consider over the coming months:

Public spending – Although we shouldn’t take the last Budget too seriously, given that this was a Coalition effort and the Conservatives now look like they will be able to govern on their own. However, for many charities which receive government income of one form or another, it looks like austerity is here to stay (in the short term).

According to the respected Institute for Fiscal Studies, government cuts in the first two years of this Parliament will be faster and deeper than any in the last Parliament, although the Chancellor may feel able to slow down given the Conservatives electoral victory. In any case, for those  charities working in unprotected areas such as criminal justice, welfare, environment, culture and local government things, things look very choppy.

Business rates – the Conservatives in the Treasury launched a major review into business rates and the Prime Minister (and Chancellor) have repeatedly said that they would like to see big reform of the business rate system during this election campaign as a way to help small businesses. But how will this affect charities, and particularly our £1.6bn business rate relief which is a life line for so many?

CFG will be responding to this consultation, but with an emboldened Conservative Party more radical reforms may be on the agenda – so charities will need to be vigilant.

Payment by Results – in the Conservative Manifesto, there was a promise to continue to use Payment by Results (PbR) to deliver public services and help charities become more engaged in public service delivery. This is despite significant concerns raised by charities about their workability and impact on the sustainability of organisations delivering services through them. There have been some improvements to the model through the Transforming Rehabilitation reforms (at least on paper) and NCVO and Clinks are now monitoring the implementation of this reform.

But it looks like charities will need to get used to this method of service delivery (and prepare for more Social Impact Bonds, its cuddlier cousin) – but in general, the trends of the past five years look set to continue.

There is also likely to be a reshuffle very soon, so watch this space to see who the key Ministers for charities may be.