Budget 2020: What it means for charities

Budget 2020: What it means for charities

Sam Boyle | 13 March 2020

Following this week’s agenda-setting Budget, Sam Boyle, Policy and Information Officer at the Institute of Fundraising, looks at what was announced and what it will mean for fundraisers and charities alike.

With the news cycle having been dominated by the coronavirus in recent weeks, it will come as no surprise that Rishi Sunak’s first Budget has largely been dominated by plans to mitigate its impact. The government announced a £30 billion package to support businesses, individuals and public services through the crisis.

But that’s not to say that there weren’t eye-catching announcements elsewhere. Boris Johnson announced on the steps of 10 Downing Street in December that one of his priorities is to ‘level-up’ the UK and certainly the Budget marked a step change from the government’s previous approach to spending.

Unfortunately, there was little mention of charities and fundraisers, despite the crucial role they play in supporting the most vulnerable and providing vital services. With a spending review announced for later this year, there is a real opportunity for the government to set out how they can support charities in more substantial terms than they did yesterday.

That said, here are some of the key headlines for charities from this year’s Budget:

Support for individuals and businesses affected by the coronavirus – but no mention of charities

There was a lot of speculation ahead of the Budget about what key measures the government was going to introduce, particularly around sick pay for the self-employed and people working in the ‘gig economy’. The government announced the following to tackle these issues:

  • Sick pay for those asked to self-isolate: The government announced that Statutory Sick Pay (SSP) will be paid to anyone who has been advised to self-isolate, regardless of whether they have developed symptoms of the virus. Instead of receiving payment after a week, individuals isolating will get paid on the first day of going on sick leave.
  • Support for the self-employed: For those who are self-employed, there was some good news – the government announced that workers who are not eligible for sick pay will be able to claim contributory Employment Support Allowance. 
  • Taking the burden of SME’s during the outbreak: Businesses with less than 250 employees will be able to reclaim the costs of providing SSP to employees absent due to the coronavirus for two weeks per employee. SMEs that are eligible for small business relief will also get £3000 cash grants.


Many of these measures will provide substantial support for businesses up and down the country and we welcome any early measures to help mitigate the impact. But there was no mention that the same measures apply to charities.

This is something we would like the government to provide greater clarity on, including an emergency fund to support charities at financial risk and implementing short-term tax deferments. Earlier this week we joined forces with sector bodies to ask for support for charities to deal with the difficulties that lie ahead, and we look forward to hearing more measures specifically for charities.

Since the Budget was announced the Treasury have said that some charities will be able to access the Coronavirus Business Interruption Loan. However, this will only apply to charities which get over half their income from trading – i.e. not likely very many.

Funding announcements for charities

Although there weren’t many mentions of charities directly, there were a number of proposals that could impact funding. There was confirmation from the government that they will commit to the UK Shared Prosperity Fund, which will replace the EU structural funds lost following the UK’s withdrawal earlier this year.

Other announcements included:

  • A £10 million boost to the Armed Forces Covenant Trust
  • A £250 million Cultural Investment Fund to support ‘culture, heritage local museums and neighbourhood libraries.’
  • A £500 million Youth Investment Fund to build new youth centres, update and refresh current ones and offer services for young people across the UK.
  • £237 million to provide accommodation for up to 6000 rough sleepers. 


Charity Finance Group have a more comprehensive list of the proposals here. 

Business rates

Although there were very few charity specific proposals in this year’s Budget, there have been several announcements that should be useful to charities. Increases to the Employment Allowance and Retail Discount will be welcome news for many charities and the introduction of a zero rate of VAT on digital publications is also helpful.

Most significantly of all, the government announced that there will be a comprehensive review of business rates relief later this year. With existing charitable reliefs worth at least £2 million a year, it is important that these are protected and extended.

Just as the government’s Budget can be neatly split into the short to medium term response to the coronavirus and their long term pledge to levelling up across the country , it is a good time for them to reflect on what support they can give to charities over the coming months and how they can best support the sector in the coming years through reform to the tax system.

Sam Boyle is Policy and Information Officer at the Institute of Fundraising.



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