The Fundraising Regulator plans to increase its levy and other registration fees for charities from 2024-25.
As part of the its five-year strategic plan, published today, the regulator said a rise in the amount it charges charities will be “necessary” to finance a “modest” increase in staffing and an upgrade to its systems.
The regulator will consult charities on the changes before moving ahead, and plans no further increases before 2027.
It will also begin a full review of its Code of Fundraising Practice later this year, its first since the regulations were updated in 2019.
The regulator also plans to conduct detailed research into the general public’s experiences with, and expectations of, charitable fundraising.
Levy increase to depend on multiple factors
The regulator is funded almost entirely by charities paying the annual levy or registration fees, with £2.4m from 4,975 charities in the year to August 2021 and just £5,000 from investments.
Charities in England, Wales and Northern Ireland that spend more than £100,000 a year on fundraising are currently asked to pay the voluntary levy, while smaller organisations and commercial suppliers can register for a lower fee.
The regulator said the scale of the levy has not increased since it was established in 2016 but it has introduced extra bands for larger charities to contribute more money and smaller organisations to contribute less.
It now plans to increase its levy and registration fees for the first time, with the amount depending on whether the number of charities paying the fees increases, as well as external factors such as the rate of inflation.
“We think an increase in the middle of the plan period will be necessary. After that we think the levy can be kept at the same level until the next strategic plan period,” its plan states.
“We will consult with charities about these changes. We have yet to see the full financial impact of the pandemic on charities’ accounts and will need to be responsive to changing economic conditions so the forecast budget for the five-year period [...] may need to change.”
Assuming it increases fees, the regulator forecasts its income from the levy to increase from £2.42m in 2023-24 to £2.66m in 2024-25, while it predicts money from registrations to rise from £230,000 to £281,000 in this time.
Meanwhile, the regulator anticipates running a deficit budget in the current financial year and plans to use some of its reserves to cover this.
Plans to evolve
Lord Harris, chair of the Fundraising Regulator, said: “We have seen considerable changes in the fundraising landscape since we were established and anticipate that methods will continue to shift and develop over the next five years too – shaped by wider social, economic and technological changes.
“This strategic plan reflects our ongoing commitment to evolve as an agile regulator alongside the sector – ensuring our regulation protects donors and the public, while also supporting a vibrant and creative fundraising sector. At the core of our plan are the principles of innovation, proactivity, intelligence, and collaboration.”
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