We are told 'it is better to give than to receive', but sometimes giving can cause problems for the donor. This may be through unwanted solicitations for money or could even extend to intimidation where people may not agree with the cause benefited by the donor's largesse. This was an issue raised during the progress of the Charities Act 2006 through Parliament.
During the passage of the Charities Act, concerns were raised that there were elements in the proposed Charities Bill which could deter potential philanthropists from setting up grant-making charities. It was also suggested that the Charities Bill could do more than it did to encourage philanthropy. A 'philanthropy objective' was drafted, designed to 'foster giving to charities and the furtherance of charitable purposes by private individuals and others'. In the event, this objective did not find its way into the final Act. Another amendment was made, however, which does ease the position of those who wished to establish charitable foundations.
According to research put to the Joint Committee which considered the Charities Bill in draft in 2004, a fifth of those who had set up grant-making charities had serious reservations about doing so. The lack of privacy associated with establishing such a trust was a notable factor. This could be exacerbated further by the new disclosure requirements for charity accounts which seriously diluted anonymity in relation to grants made by such trusts. The point was made that, if a charity donor so wishes, they should be able to donate anonymously, even if they are making the donation through their charitable trust. It was noted that there may be good reasons for wanting such anonymity, particularly if the cause may be viewed by others as unfashionable.
The Government took up the point and the requirements for the content of a charity's accounts will be amended by the new Charities Act. Where the the settlor, the regulations may not require disclosure, during the lifetime of the settlor or their spouse/civil partner, of the identity of those who receive grants from the charity, or of the amounts of any individual grants. This amendment therefore preserves the public policy point that there should be transparency, but balances it with a sufficient level of anonymity to protect the settlor and his/her partner during their lifetimes.
This is a small but important amendment for those who wish to establish a charitable foundation, or charity is a charitable trust created by may already have done so. There nonetheless remain concerns that the Charities Act could have done more to encourage philanthropy, although the Act does provide that the Charity Commission has a duty to encourage charitable giving in all its forms. There is a general move towards greater philanthropy at present and it is hoped that this will continue under the new Act.