Solid foundations Crowdfunding finance Adding social value Crowdfunding finance Crowdfunding for charities

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  • Solid foundations Positive returns offered by commercial property investment

    Crowdfunding finance Crowdfunding for charities as a test bed for fundraising skills

    Adding social value The social economy is on the march to build a stronger society

    August/September 2014 l


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    One interesting but little focused on trend, is the

    one that highlighted charities involved in mergers

    transferred over £225m to form new organisations

    last year. This is considerable.

    Together, the 189 organisations undertaking mergers

    turned over almost £1bn, or some 2.4 per cent of

    total voluntary sector income. This was according to

    The Good Merger Index, the first overview of charity

    sector mergers, produced by management consultancy

    Eastside Primetimers.

    There was significant activity amongst health and social care organisations,

    which accounted for more than 50 per cent of mergers, with a disproportionate

    bias towards mental health and disability charities, reflecting commissioners’

    preoccupation with lower costs and pan-disability provision.

    The Good Merger Index also revealed comparatively high levels of merger

    activity in supported housing, community development, minorities,

    intermediary and religious charities.

    Broken down into approaches: mergers represented: 23 per cent, takeovers:

    43 per cent, subsidiaries: 23 per cent; group structures 7 per cent and asset

    exchanges 5 per cent.

    Sector hotspots were health & social care (53 per cent of all deals),

    intermediaries (23 per cent); faith-based organisations (17 per cent),

    community (15 per cent) and housing (14%).

    Richard Litchfield, CEO of Eastside Primetimers, noted that the data for

    2013/4 shows that many negative perceptions of mergers are misplaced,

    which, of course, is a good thing for the sector.

    In 75 per cent of deals, the acquired organisations were able to retain some

    form of identity, management control and Board representation. The study

    shows that mergers come in all shapes and sizes, and reach into almost every

    part of the charity sector.

    This suggests the sector is consolidating; or, put another way, becoming

    leaner and fitter for the future. This can only be a good thing for the sector

    going forward.

    On a final note, this is my last issue of Charity Times as Editor, as I move on to

    pastures new. I wish you all the very best in your endeavours and outstanding

    work in the sector.

    Andrew Holt Editor

    Editor Andrew Holt 020 7562 2411

    Contributing Writers Dawn Austwick, Rachael Badger, Anna Bloch, Dan Corry, Nicola Davies, Harry de Ferry Foster, Peter Holbrook, Julie Howell, Tris Lumley, Paul Palmer, Jayne Phenton, Antony Savvas, Asheem Singh, Sam Simmons Design & Production Matleena Lilja 020 7562 2400

    Commercial Manager Cerys Brafield 07766 662 610

    Advertising Manager Sam Ridley 020 7562 4386

    Subscriptions Joel Whitefoot 020 8950 9117 Subscription Rates (6 issues pa) £79pa registered charities £119pa rest of UK, £127pa EU £132pa elsewhere Printed by Warners Midlands All rights reserved. The views expressed are not necessarily those of the publishers. ISSN : 1355-4573 Published by Perspective Publishing, 6th Floor, 3 London Wall Buildings, London EC2M 5PD Managing Director John Woods

    Publishing Director Mark Evans

    Positive mergers

    Average net circulation of 9,426 copies for July 13 –

    June 14

    E D I T O R I A L C O M M E N T

  • Updates to regulation may not sound like the most exciting development, but we believe that recent regulatory changes can benefit charity investors.

    Newton has recently launched the Newton Growth Fund for Charities and the Newton Growth and Income Fund for Charities*. These two Non-UCITS Retail Schemes (‘NURS’) are designed especially for the charity sector and will allow charities to eliminate some of the tax costs associated with their investments, specifically:

    • any profits made from investments will be exempt from capital gains tax

    • the Fund’s annual management charge will not be subject to VAT

    • the Fund will not pay stamp duty on UK equities

    • quarterly dividend payments are not subject to tax

    These new Funds underscore Newton’s commitment to the UK charities sector, in which we have managed client assets for over 25 years.

    Call Stephanie Gore on 0800 917 6594 or email for more information.

    *BNY Mellon Charities Funds is an UK umbrella unit trust authorised by the Financial Conduct Authority as a non-UCITS retail scheme, currently comprising two sub-funds, the Newton Growth Fund for Charities and the Newton Growth and Income Fund for Charities. BNY Mellon Fund Managers Limited is the manager of the fund. Newton Investment Management Limited has been appointed by the manager as the investment manager of the fund. Tax treatment depends on the individual circumstances of each client and may be subject to change in the future. Newton is not a tax expert and independent tax advice should be sought. The opinions expressed in this document are those of Newton and should not be construed as investment advice. This is a financial promotion. Issued by Newton Investment Management Limited (Newton), The BNY Mellon Centre, 160 Queen Victoria Street, London EC4V 4LA. Registered in England No. 01371973. Newton is authorised and regulated by the Financial Conduct Authority.


    Charity Times_204x271_1.indd 1 27/6/14 13:51:16

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    News in brief 6-9 Latest sector news

    The Review 12 Towards Effective Prevention Reviewed by Asheem Singh

    13 Rising to the Challenge Reviewed by Rachael Badger

    14 Everyday Justice Reviewed by Jayne Phenton

    15 Restoring the Balance Reviewed by Paul Palmer


    10 Fundraising in the dock Andrew Holt analyses allegations about fundraising

    Columns 16 Sector reputations Anna Bloch on transparency

    17 Political outlook Rosie Olliver on vision

    18 Localism and scale Dan Corry & Tris Lumley on delivery

    19 After the Big Society Dawn Austwick on a localist agenda


    Charity Services

    55 Suppliers Directory Comprehensive listings of products and services for the sector


    C O V E R S T O R Y : B E Y O N D T H E B I G S O C I E T Y Nicola Davies looks at the politics and finance that could indicate future visions of the charity sector

    C O N T E N T S


    COmmERCIAL PROPERTY 34 Solid foundations

    Harry de Ferry Foster answers questions from leading charities on the issues and approach to commercial property investment

    SOCIAL ENTERPRISE 46 Adding social value

    Peter Holbrook argues that social enter- prises should play a greater role in getting involved with public service contracts

    wEB DESIGN & INNOVATION 50 Digital future

    when it comes to innovative web design, charities are taking calculated risks where they promise to deliver substantial return on investment, finds Julie Howell

    In association with:


  • The ChariTy Commission has opened

    a statutory inquiry into Ummah Welfare

    Foundation, registered charity number

    1150190. The charity has objects to relieve

    poverty and sickness and advance

    education throughout the world by

    the provision of services. The Charity

    Commission carried out a compliance visit

    to the charity in June 2013, which included

    an inspection of the charity’s books and

    records. During the visit, concerns were

    identified regarding the governance and

    financial management of the charity,

    which the regulator provided specific

    advice and guidance on.

    UK bUsinesses and individUals

    who are solving social problems will be

    celebrated in October at the first-ever

    social investment awards, backed by

    the Cabinet Office and RBS. The UK social

    investment market is worth over £200

    million, supporting social enterprises that

    contribute over £55 billion to the economy

    each year. The market now employs over

    two million people in the UK. The market

    enables ventures that might otherwise

    struggle to access finance to grow and

    make an impact on local communities.

    PoliTiCians From all ParTies should

    pledge to turn around the nation’s most

    deprived social housing estates within the