Small Charity Sector

Peter Bedford Excerpts

Tuesday 3rd March 2026 Westminster Hall

[Mr Peter Bedford (Mid Leicestershire) (Con)]

It is a pleasure to serve under your chairmanship, Sir Roger. I thank my right hon. Friend the Member for Chingford and Woodford Green (Sir Iain Duncan Smith) for introducing this immensely important debate. The UK’s charity sector is facing mounting challenges. Just like many small businesses, charities across the country have seen a sharp increase in their running costs, driven by persistent inflation and, unfortunately, unhelpful economic policies from the Treasury.

The increase in the national living wage, the rise in employers’ national insurance contributions and changes to business rates have placed considerable pressures on organisations that do so much for our constituents in need. For a sector that contributes £20 billion in economic value to the country each year, that should concern us all. As we have heard, these organisations are more innovative and grassroots-led, and ultimately they are generally supported by the public. If small and medium-sized charities continue to close at the current rate, it will impact our communities and place further strain on already stretched public services.

[Claire Young (Thornbury and Yate) (LD)]

Small charities with excepted charity status, including many individual scout and guide groups, do not have a registered charity number. 1st Ram Hill Scouts in my constituency tell me that they reckon they are excluded from about 80% of grants because they lack a charity number. Does the hon. Member agree that that is a serious sustainability priority for small groups?

[Mr Bedford]

The hon. Member has made her point clearly, and I am very sympathetic to the argument she puts across. In my constituency, I have seen the impact of these economic policies and the tough environment for small and medium-sized charities such as Wyggestons and Trinity Almshouses, which provides sheltered accommodation and residential care. It believes that the Charity Commission could also be doing more to support these groups.

Meanwhile, other charity-funded local care providers, such as Rainbows hospice for children and young people and LOROS, have made it clear that the economic climate is making their future more uncertain. These organisations are incredibly important to my constituents, and it would be an absolute travesty to see them reduce their services or close altogether. The Government need to think about creating a carve-out for the charity sector, so that it does not have to pay astronomical employment costs—something that Conservative Members argued for during the national insurance debate. That would be a sensible move to protect jobs and sustain local services, and it would command broad public support.

To conclude, charities are at the heart of our communities. They reduce pressure on public services and command widespread public support, yet we in this place are not doing enough to support and protect them. I urge the Government to listen carefully to the arguments that the CSJ and my right hon. Friend the Member for Chingford and Woodford Green have eloquently presented. My plea to the Government is to create a carve-out for the wider sector to ensure that running costs do not drive many charities, including those in my constituency, to close.