Cabinet Office Questions
June 13, 2012
Nick Hurd answers back bench MPs’ questions on a range of issues including Big Society Capital, volunteering red tape, charitable donations and the National Citizen Service pilots.
Big Society Capital
Sandra Osborne (Ayr, Carrick and Cumnock) (Lab): What steps he plans to take to measure the social impact of Big Society Capital. 110350
Ann McKechin (Glasgow North) (Lab): What steps he plans to take to measure the social impact of the Big Society Capital. 110359
The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd): Big Society Capital exists to make it easier for charities and social enterprises across the UK to access capital. It has two measures of success: growth in social investment and the social impact of its investments. It is required to report annually on both the social and financial performance of those investments.
Sandra Osborne: I thank the Minister for that response. Cathy Pharoah of the Centre for Charitable Giving and Philanthropy has said that Big Society Capital is likely to be biased in favour of safe lending. How will the Minister ensure that smaller projects with higher-risk clients have access to it?
Mr Hurd: Big Society Capital is a fundraising organisation with a social mission and exists to correct a market failure. It will support innovation and grow the new social investment market and will invest across a range of products. All we have asked it to do is ensure that it secures a sufficient return to cover its costs.
Ann McKechin: In a written answer to me on 11 June, the Minister stated:
“The Investment and Contract Readiness Fund applies to England only.”—[Official Report, 11 June 2012; Vol. 546, c. 218W.]
Given that Big Society Capital is for the whole United Kingdom, how will companies in other parts of the country be able to secure the same assistance?
Mr Hurd: Ultimately, that is a matter for the devolved Administrations, but the hon. Lady is right: Big Society Capital has been set up to be available to charities and social enterprises throughout the UK. The investment and contract readiness fund—£10 million of grants—is available to charities and social enterprises in England which want to make themselves more investment-ready, but the policy area is devolved and therefore a matter for the devolved Administrations.
Robert Halfon (Harlow) (Con): Smaller charities say that they have a harder time accessing capital than the big “Tesco” charities. How can we ensure that the big society benefits the little society?
Mr Hurd: My hon. Friend makes a very good point, which is particularly relevant and valid in small charities week. He is entirely right. Access to capital affects smaller charities more than larger ones, and that is one reason why within two years we have developed and established the world’s first social investment institution, Big Society Capital, which exists to make such capital much easier to access.
Ms Margaret Ritchie (South Down) (SDLP): In measuring the impact of Big Society Capital, will the Minister assure the House that the resource will tackle deprivation in hard-to-reach communities, particularly in Northern Ireland, where there are isolated rural communities and 35 scientifically measured areas of disadvantage?
Mr Hurd: I have been to Northern Ireland myself to make the point that Big Society Capital is available to charities and social enterprises there. The honest answer to the hon. Lady’s question is that any outcome depends on the quality of the investment proposition that intermediaries take to Big Society Capital, but we are very keen to engage with charities and social enterprises in Northern Ireland in order to make sure that the measure is as accessible to Northern Ireland as we say we want it to be.
Mr Mark Spencer (Sherwood) (Con): What steps he is taking to reduce the administrative and regulatory burdens that affects the number of people who volunteer. 110354
The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd): We want to make it much easier to volunteer, so we are implementing most of the recommendations in Lord Hodgson’s excellent report, “Unshackling Good Neighbours”. To identify any remaining burdens, we have launched the civil society red tape challenge and have urged the sector and the public to contribute by visiting the challenge website.
Mr Spencer: In Sherwood, many people are put off volunteering by unnecessary Criminal Records Bureau checks. Will the Minister update the House on how we can reduce that burden?
Mr Hurd: That is a frustration felt in many constituencies. My hon. Friend will be aware that changes are under way. There are two major thrusts of change: many fewer people will require checks; and those who do will find it much easier to carry those checks around the system—the portability for which people have been asking for some time. Those changes will largely be in place by next spring, and I am sure that they will be as welcome in Sherwood as they will in Ruislip.
Mr Gregory Campbell (East Londonderry) (DUP): This issue has come up repeatedly. Does the Minister accept that in the coming years the red tape challenge will be judged on the numbers of people who are involved in volunteering and the verdict of those who want to volunteer?
Mr Hurd: All I know is that it is incumbent on Government to get out of the way as much as they can. Many areas of regulation are too intrusive and take up too much time and money that could be better used. I think that there is cross-party support for wanting to encourage more people to get involved, and if the Government can get out of the way, then we should.
Seema Malhotra (Feltham and Heston) (Lab/Co-op): What discussions Ministers in his Department have had with their ministerial colleagues on charitable donations. 110357
The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd): We liaise regularly with other Departments in the development of our agenda to encourage more giving of both time and money.
Seema Malhotra: Research from New Philanthropy Capital has revealed that 65% of charities are being forced to cut front-line services. In addition, after the way in which the tax relief proposal was handled, the expert Alana Lowe-Patraske said:
“It remains to be seen if donors and charities trust this government on philanthropy”.
Will the Minister update the House on how the Government will repair their relationships with charities?
Mr Hurd: I think the hon. Lady will find that most people in the sector and most commentators recognise and welcome the Chancellor’s change of mind on that. They also recognise that this is a Government absolutely committed to creating the conditions for charities and social enterprises to do more. That includes supporting more giving of time and money through initiatives such as the social action fund, through various match funding and through some generous tax incentives—
Mr Speaker: We are grateful to the Minister.
Richard Fuller (Bedford) (Con): I commend the Government for their actions following the consultations on taxation and charitable donations, but may I urge the Minister to look again at the gift aid structure, and perhaps to consider a transfer to a system whereby individuals can deduct their charitable donations from their tax directly?
Mr Hurd: Gift aid and all matters relating to tax are a Treasury matter. My hon. Friend will be aware that gift aid is under constant review, and in the 2011 Budget some welcome initiatives were brought in to make gift aid easier to claim for small charities and small donations.
Behavioural Insights Team
Caroline Dinenage (Gosport) (Con): What recent assessment he has made of the work of the behavioural insights team. 110358
The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd): The team is headed by a steering board which is chaired by the Cabinet Secretary. In September 2011 the team published an annual update of its first year, and a two-year sunset review will be conducted by the board in summer 2012.
Caroline Dinenage: What financial saving does the Minister estimate has so far been made by this initiative?
Mr Hurd: The team does some very interesting work on encouraging behaviour to change in cost-effective ways. If my hon. Friend looks at the annual report, she will see some good examples. For instance, by slightly changing the wording in letters sent out by Her Majesty’s Revenue and Customs to self-assessment taxpayers who owed money, the team increased payment rates from 68% to 83%, which is estimated to lead to savings of £30 million a year in administrative and court costs if rolled out across the country.
Nicola Blackwood (Oxford West and Abingdon) (Con): I am sure that the Minister will join me in applauding the work of the Archway Foundation, which for 30 years has been combating loneliness in my constituency. Like many charities, it is struggling increasingly with excessive regulation. What steps is he taking to combat red tape to let charities do what they do best, which is to help those who are most in need in our communities?
The Parliamentary Secretary, Cabinet Office (Mr Nick Hurd): I am delighted to congratulate the Archway Foundation on its work. My hon. Friend is right that there is too much that gets in the way of charities and voluntary organisations in doing their work. That is why we are undertaking what is probably the most comprehensive review of the regulation and legislation that affects the sector.
Caroline Dinenage (Gosport) (Con): What assessment has the Minister made of last year’s National Citizen Service pilots?
Mr Hurd: Independent research has shown that more than 8,000 teenagers committed almost 250,000 hours of service to their communities last year, that the customer satisfaction rating among the teenagers who took part was 93%, and that the benefit-cost ratio was 2:1. That was a good start and I encourage all colleagues of all parties to get involved with the NCS in their constituencies this summer. It is a fantastic opportunity for their young constituents.