Philanthropy

Lord Bishop of Newcastle Excerpts

Thursday 2nd December 2010 Lords Chamber

[The Lord Bishop of Newcastle]

My Lords, I, too, am grateful to the noble Lord, Lord Janvrin, for initiating the debate. At first sight, the title, “The case for encouraging philanthropy”, is a proposition from which few, if any, could dissent, although I realise it might just be possible to read between the lines and discern a subtext that might become a substitute for government funding and allow government to escape from some of its responsibilities to the citizen. However, even if that were anyone’s intention—I do not believe that it is—and if anyone wanted to suggest that encouraging philanthropy is a way of dismantling some parts of the welfare state, we should remember that Beveridge’s plan took for granted the existence of strong local communities, mutual relationships and support and sheer good neighbourliness. Philanthropy is an essential component of a civilised society, and the mixed economy of individualism, community living, organised philanthropy and state action is surely the key to societal well-being.

I have used the words “organised philanthropy” because I wish to speak about one example of that from my own experience. I declare an interest as one of the vice-presidents of the Community Foundation that serves Tyne and Wear and Northumberland. I shall take further one or two of the points made by the noble Baroness, Lady Prashar. The Community Foundation is one of the best examples of organised philanthropy. It began in 1988 and now manages over 250 donor funds. Last year it made 1,700 grants totalling £6 million, and it is the largest of the 57 Community Foundations in the UK. It is the hub for social philanthropy in the area and inspires, encourages and supports giving, which strengthens local communities, including some of the most depressed and disadvantaged communities anywhere in the country.

Individuals, families, businesses and companies can set up a named fund that supports the needs of the causes that match the interests of the donor. The foundation is a kind of philanthropic dating agency; it matches applications from groups and individuals with the wishes of the donor, and then does the rest. It has been successful for three reasons: it has attracted a diverse membership of individuals, voluntary groups, public bodies and businesses, all of whom are engaged in local society; the genuinely strong sense of community and identity at the heart of the north-east; and the sheer generosity of the donors, who have inherited a long tradition of supporting local people, communities and causes. On Tyneside there is a great tradition of generous giving going back generations.

In Victorian times, of course, charitable trusts were set up by the very wealthy, many of whom were paternal employers who cared for their workforce. They knew that their livelihood depended on their workforce and local community and were very aware of the human destructiveness of poverty and hardship. Today, successful business people have increasingly recognised that their success and their wealth carry with it a responsibility to give something back. That has often been done through vehicles such as the Community Foundation.

I am humbled by the sheer generosity of people to those less fortunate than themselves. Initiatives such as the Grassroots Endowment Challenge of the previous Government, together with the launch of Acorn funds, have helped immensely and have brought organised philanthropy within the reach of most people. For example, a donation of £20 a week—£1,000 a year—will build up a fund over 25 years.

Yet there are still challenges to overcome. There is a good deal of evidence of philanthropy among the wealthy, but how do we encourage it, in an organised way, among those who are less wealthy but still comfortably off? How do we shift from spontaneous giving to appeals such as Children in Need to a more organised giving because of the values that we hold about our mutual belonging and commitment to one another and for the well-being of the society of which we are a part?

Somehow we have to encourage and develop a whole new culture of giving. How do we do that? There have been a few suggestions, and I support many of the things that the noble Lord, Lord Janvrin, said. We need to recognise our philanthropists more positively and in new ways; we need to start the educational process in our schools and build up the pioneering work of the Institute for Philanthropy; we need our banks to play their part by setting up charity bank accounts to make it easier to give; we need more challenge funding such as the Grassroots Endowment Challenge; and we need perhaps better tax incentives and a much simplified gift aid system. All that should encourage a culture of giving.

Philanthropy needs and deserves greater encouragement, but it is not and can never be a replacement for public sector funding. It is unlikely that donors will ever give to unfashionable projects or to unappealing and unglamorous but necessary work. I am thinking about three very small charities that are trying to do heroic work by giving care and emergency payments to destitute asylum seekers. Where do such bodies go for funding? They do not get it from government and they certainly do not get it from some donors through bodies such as the Community Foundation. Philanthropy can go only so far. It will always need the support of an active Government, and an active Government need to do all they can—along with the rest of us—not only to support the case for encouraging philanthropy but to be active in encouraging it for the well-being not only of our society but of each other.