Sunday, 17 October 2010

Cameron's Fake Charities dilemma

Labour abused the charitable sector as it abused every other aspect of public life - corruptly, cynically and for pure party political ends. It poured millions upon millions of tax money into fake charities whose sole aim was to support Party policy. Whenever a Labour minister wanted to do something both pointless and unpopular - say reducing town centre speed limits to 15mph - he would first arrange for a tame fake charity to hit the press and airwaves with the appropriate scare stories, demanding government action. The minister would ensure they had sufficient resources to make the media impact required. And so under Labour a whole raft flourished of fake charities advocating central State intervention, control and regulation, nannying, redistributionism and promoting the unequal preferment of Labour's client voter groups, and all paid for by the taxpayer. Take a look at the accounts of some of them; 95% funding from government departments and the lottery is hardly unusual, with another 4% from 'commercial activities' and scarce a single pound from donations, subscriptions and legacies. As fake as fake can be.

Easy, you say. Just effect a blanket ban on a single penny of our taxes being paid to charities by the entire public sector. They must live or die by public subscriptions, legacies and donations alone. Except that this would also destroy the increasing importance of the 'third sector' in designing and delivering public services in a very tax efficient way and with little long term liability to the taxpayer; and no payroll liabilities at all. 

And this is Cameron's dilemma; how to cut-off the truly fake charities at the knees whilst ensuring that, say, a neighbourhood not-for-profit group that takes over some of the local council's functions, and needs some part of that council's budget to do so, can function. To be frank, I don't think any politician can be trusted with funding quasi-autonomous 'voices' - the temptation is just too great to push money at friendly voices and withhold it from those critical. And these bodies are not democratic, not elected; they are self-selecting. They have no legal or democratic legitimacy. But such arrangements are currently at the heart of Tory policy, which makes me uneasy. We can't just stand by and permit Labour corruption and tax theft to be replaced by Tory corruption and tax theft. 

There is, of course, a 'third way' for the 'third sector' to steal the ghastly political jargon. And that is to allow new democratic, elected, legitimate and tax-levying bodies at the level of the ville and commune to develop, within strict financial limits, with a reduction of say £3 in council tax for every £2 taken by the new bodies for all those resident in their area. They will be run by the same people whom Cameron has identified for the transfer of functions, but be beyond Party control or whim. And this will truly be the big bang Localism we need to do more with less.   


JohnofEnfield said...
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Weekend Yachtsman said...

We are perhaps looking at the problem from the wrong end.

The "neighbouring not-for-profit" that carries out genuine and desirable good works could exist as a real charity, if the State did not pre-empt almost all of everyone's discretionary disposable income. This is the central problem.

First shrink the state - hugely. Then watch while a thousand flowers bloom.

Of course, as the Irishman said, if we want to get there ideally we wouldn't start from here.

No doubt I am a hopeless idealist.