Small Charitable Donations and Childcare Payments Bill

Susan Elan Jones Excerpts

2nd reading: House of Commons & Money resolution: House of Commons & Programme motion: House of Commons
Tuesday 11th October 2016 Commons Chamber

[Susan Elan Jones (Clwyd South) (Lab)]

It is a great pleasure to follow the hon. Member for Rochford and Southend East (James Duddridge). I think it was four years ago that we served on the Committee considering the original Bill, which later put in place the gift aid small donations scheme. I think that the hon. Members for Foyle (Mark Durkan) and for Amber Valley (Nigel Mills) were also members of the Committee. At the time, we were all quite enthused about the programme; indeed, we still are. We recognise the importance of giving gift aid-style relief on small donations, especially in a way that will help small charities.

Some real improvements to the Bill have been suggested today. The introduction of contactless payments is good, although I fully agreed with what the right hon. Member for Meriden (Dame Caroline Spelman) said about the lack of provision for cheques. I want to dangle a little carrot in front of Government Members by saying that when the original Bill was discussed in Committee, it was discovered that—shock, horror—it was not only £5, £10 and £20 notes that would be eligible for gift aid-style relief, and that even if someone dropped in a few euro notes, they would be eligible as well. If one can have relief for euros and other currencies, there is no reason why it is not possible with cheques. That would be a welcome improvement along with contactless payments and a look at text donations as well. The increase in the upper limit is very welcome, and it shows how this scheme has developed and how it has the potential to help small charities. We need to realise that this Bill is all about helping small charities, because it is those charities and community groups for which this Bill was created.

In the Committee that considered the Charitable Donations Act 2012, we quibbled away at the long-forbearing Ministers about the ratio between gift aid eligibility and donations. At the time, in the original draft of the Bill, we were talking about a ratio of 3:1, 4:1 or 5:1. We asked persistently why it was one ratio and not another. The hon. Member for Rochford and Southend East just asked why there should be any link at all with gift aid. The survey from the National Council for Voluntary Organisations, the Charity Finance Group, the Institute of Fundraising and the Small Charities Coalition sets out much the same view. Even if it was felt that, for reasons of fraud, we needed that link with gift aid, why is the 10:1 ratio on a tablet of stone?

We discovered in that earlier Bill Committee that ratios of 3:1, 4:1 and 5:1 were pretty expendable. Why, if a charity is registered and has about £10 in gift aid, is that not enough in terms of fraud detection? Furthermore, I am not 100% convinced of the link with fraud. When we had that previous debate, I remember someone raising the issue of the Cup Trust, which was—I will try to put this diplomatically—involved with various fraudulent practices. We innocently asked whether it was registered for gift aid. Well of course it was, which does not suggest that there is much link between fraud and gift aid. If that is something that the Government genuinely believe is a problem, I really cannot see for the life of me why the ratio has to be 10:1; it just does not make sense.

On balance, this is a good Bill. We welcome it, but I urge the Minister, the Government and all members of the Committee to look again at the whole matching requirement, how it is constituted, and why oh why the ratio has to be 10:1.

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[Mark Durkan (Foyle) (SDLP)]

It is a pleasure to follow the hon. Member for Taunton Deane (Rebecca Pow), who rightly says that there are practical and positive measures in the Bill that we should welcome. However, I believe that the Bill could have gone forward and been even more practical and positive and offered even more flexibility.

As the hon. Member for Clwyd South (Susan Elan Jones) said earlier, she and I served on the Committee that considered the Small Charitable Donations Bill back in 2012. Indeed, the point about euros emerged as a reassurance to me, as I represent a border constituency in Northern Ireland. I pointed out that when a number of charities in my constituency raise money, whether with bucket collections or other ways such as church events, they find euros in their collections, and I asked whether they would have to sift them out or whether they could honestly declare them. In fairness, the then Minister, now the Secretary of State for Communities and Local Government, came forward with the clarification that that money could certainly all be counted.

The hon. Member for Clwyd South is right to say in that context that, when the 2012 Bill was being considered, the refusal to allow donations in the form of cheques or contactless or various other foreseeable electronic payments was odd. I wonder whether even now the Minister will consider allowing, in Committee, an enabling clause giving Ministers the power to permit payment by cheques and so on in future, so that these measures would not have to come back before the House. As the hon. Member for Amber Valley (Nigel Mills) said, he made that point in the Committee on the 2012 Bill.

In the Small Charitable Donations Act 2012, the Treasury was given significant powers to change things by order; it was given the power to change the connected charities amount, the community buildings amount, the remaining amount, and the capped total. It could amend the gift aid matching rule, abolish it, and reinstate it, if previously abolished, with or without amendment; it could even, by order, amend the meaning of “eligible charity”, and the limit on the value of individual donations. Sensibly, the Treasury was given the power to make significant working changes to the scheme by order. It seems strange that in this further bit of primary legislation there is not similar flexibility around, say, the use of cheques. That flexibility could be introduced in Committee.

I had the unusual experience of arriving in the 2012 Bill Committee to find that the Government had tabled an amendment to take up a point that I made on Second Reading. The penalty provisions stipulated that a charity that had suffered a penalty from HMRC would be barred from the scheme for a period, but there was no provision for an appeal against or possible overturn of the penalty, and where the penalty had been imposed but subsequently reviewed and set aside there was no provision to say that the period of barring would no longer apply. Sensibly, the Government listened. That proved to me that sometimes, when it comes to small Bills, the Government have a flexible ear and will listen to points made on Second Reading; in the case of small Bills, they can handily concede points, and indeed take the initiative and leapfrog Committee Members in making sensible amendments.

The Minister was right to say that some sensible working adjustments are made in the Bill, but they are all ones that were advocated by members of the 2012 Public Bill Committee—not just by members of the Opposition, or by me, but in many cases by Conservative members of the Committee. Members were teasing out the implications with practical ideas. Many of us were concerned that the Small Charitable Donations Bill was in danger of tilting into becoming the petty conditions Bill, given the number of different traditions, trips and traps that people could get into. I still wonder whether the Government could be a bit more generous or expansive in how they take the Bill forward. After all, it is clear that the whole matching requirement issue still causes charities problems. We should listen to charities as we take the Bill forward.

[Susan Elan Jones]

Does my hon. Friend remember that among the examples of charities that the small charitable donations scheme could help were small ones such as talking newspapers? We were very aware that if their admin staff were overburdened, they might not be able to claim what they should rightly claim.

[Mark Durkan]

Yes, the hon. Lady is exactly right. Members in all parts of the Committee raised many pertinent, practical examples of charities that we would want to be ready beneficiaries of the scheme, but that would be prohibited from taking part in it.

At the time, perhaps because this was a first move in this direction, the Minister took a narrow and highly precautionary approach, but smaller charities have not claimed the amount of small donations relief under the 2012 Act that the then Chancellor said they would; when he announced the scheme, he said that it would be £100 million. The indications to date are £25 million a year with an uplift of perhaps £15 million, going by what the Minister has said about the Bill, but we are still talking about something well short of what was promised to the charitable sector when the concept was introduced. Our challenge is how to get closer to the £100 million. We have to look at the things that are standing in the way. I acknowledge that the Government, in the consultation and in the Bill, have moved to address some of the difficulties on community buildings, but there are still some issues on the question of connected charities. The matching requirement, however, is still there, and I wonder whether the Minister can tell us whether or not are examples of fraud in the gift aid small donations scheme in the past three years. Are there any indications of whether matching requirements would have prevented fraud, or simply prevented access to the scheme?

We want to know why the ministerial team are content with arriving at an amount that is only half the amount of support originally intended—in fact, it is less than half. I therefore hope that Ministers are prepared to continue to listen to hon. Members who serve on the Bill Committee and to the charitable sector so that we can improve the scheme and make it much more effective for all the causes and examples that hon. Members have discussed, including that and so on.

As well as amending the Small Charitable Donations Act 2012 the Bill amends the Childcare Payments Act 2014. In an intervention I said that the Minister rightly presented the childcare payments scheme under the Bill—with the original Act as the source—as applying to each child. However, the Government are inconsistent, because the childcare element of universal credit is restricted to two children. Working tax credit rules apply to two children, but childcare payments under the 2014 Act are not restricted to two children. What is the reason for the Government’s cognitive dissonance? Why are there different rules on support for different families? The Minister explained how the provisions in the Bill ensure that changes can be met more responsibly by the system, but will Ministers consider the difference in experience and bureaucratic contact for parents accessing childcare payments under the Bill and the original Act and for parents who apply for the childcare element of universal credit? Under the childcare payments scheme, it is a bankable allowance, but it is not a bankable allowance for people on universal credit. They have to spend the money first, then claim it back within a short time. There is an unfair difference in treatment. Some parents are treated more generously and supportively in the way in which the system relates to them and engages with them than others, which is wrong. As legislators, we should try to ensure a more consistent approach to the principle of childcare in all the important and positive forms that it takes.

That is not to say that the childcare payments provided for are not positive and practical; I just wish that the universal credit childcare element could be made more comparable and, similarly, that if the Government see fit not to visit a two-child rule on the childcare payments system, they will abandon the idea of having such a rule for working family tax credit as well.

Small Charitable Donations and Childcare Payments Bill

Susan Elan Jones Excerpts

Committee Debate: House of Commons
Tuesday 18th October 2016 Public Bill Committees

[Susan Elan Jones (Clwyd South) (Lab)]

It is a pleasure to follow the hon. Member for Amber Valley and other colleagues. It was a great joy to be here in 2012 when the first Bill on small charitable donations appeared. It is lovely to see that contactless donations have made it into this Bill. I am speaking in favour of amendments 1, 2 and 3 because it is important that we expand the methods available.

The recent briefing from the main charitable organisations—the Charity Finance Group, the Institute of Fundraising, the National Council for Voluntary Organisations and the Small Charities Coalition—has made it clear that, although the scheme has been welcome, it is not reaching the number of charities that it could. The briefing said:

“Only one quarter”

—or 21,300—

“of the charities that could have used the scheme”

—it puts that number at 84,000—

“are using it.”

Clearly, we need to do everything we can to support the development of the scheme, particularly with a new generation of donors, and to encourage and to support the new philanthropists who may be giving by text donation or in other forms.

At the Bill Committee last time around, I was intrigued by a great debate initiated by the hon. Member for Foyle (Mark Durkan). It was possible to include euros in the scheme at the time, although it was not possible to include contactless donations. I am glad that the situation regarding contactless payments has been remedied, but I cannot see the sense in saying that, in one of our great abbeys, churches or cultural buildings, the euro, dollar, yen or whatever may be included in the scheme, but not a simple, humble cheque written in sterling. To me, that does not make any sense. I hope that the Minister considers that point.

Another related point is that this scheme works rather well for churches—I presume it also works well for other faith groups—because many small churches are part of larger denominations. Often the denomination, the diocese or whatever is registered in terms of gift aid. My slight fear, and why I think we need to look at how we can enhance and expand the scheme, is about whether we have the same reach for other small charities, because with a small church or perhaps another small faith group, the registering—the formal bit, the gift aid stuff—has already been sorted out at a higher, larger level. I question whether the scheme always has the same reach for some of the smaller charities in other sectors.

I welcome the positive move on contactless donations but hope, in the same spirit, that the Minister can extend the scope of the proposals, as my hon. Friend the Member for Salford and Eccles and other hon. Members have suggested. It would be truly dreadful if we had to wait another four years to come back to the issue and to thank the Government for including these methods in the scheme.

[Jane Ellison]

I thank colleagues for that debate; some points were made by veterans of the previous Bill Committee and I will try to respond to them.

Clause 2 is about amending the meaning of “small charitable donation”. Amendment 1 would extend the gift aid small donations scheme to include donations made by cheque, online or by SMS. Amendments 2 and 3 would extend the scheme to include SMS donations.

The scheme was introduced to address a specific problem. That is at the heart of the debate. It is intended to allow charities and community amateur sports clubs to claim a gift aid-style top-up payment when it is not practical or feasible to collect a gift aid declaration, such as with street collections. It is not simply a lighter-touch alternative to gift aid. I think this is probably at the heart of our debate. The scheme exists to provide a similar outcome in situations where charities cannot realistically obtain a gift aid declaration, but the Government are clear that, if a charity can get a gift aid declaration and claim gift aid, it should do so. There are obvious reasons for that, as colleagues will appreciate. For example, there is no cap on gift aid, whereas there is on this scheme. For that reason, the Small Charitable Donations Act 2012 restricted the scope of the gift aid small donations scheme to small donations in cash—coins and notes. Although I understand entirely the motivation behind the amendments, they are actually contrary to the stated policy intention of the scheme.

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[Jane Ellison]

Picking up on the hon. Lady’s last point, the Government have listened. There is always a bit of scepticism in politics—I think we have all felt it—on whether things change as a result of consultations, but the consultation in question was really open. We consulted and asked for ideas and, as a result the responses we received, made further liberalisations in the regime. I think that we have listened and that I have given good reasons why we do not want to go in the proposed direction for this scheme because of the nature of what it was designed to do. We are looking to future proof it for contactless payments.

On gift aid more generally, as I said, changes are already being proposed and there is a lot more we can do to increase charitable take-up. I am unpersuaded that the issues being advanced in this debate are the ones that will aid take-up without having unforeseen consequences. Perhaps we will debate those issues later in our discussions of other clauses.

[Susan Elan Jones]

I have a quick question about texts. The Minister spoke about the issue being people engaging with a chosen charity, but I am not sure that it is. For example, one might give to an appeal for a dog that appeared on the television, but the charity might be a wider animal charity. The donor might be drawn to a very specific appeal, not to wider support for the charity. As donors, consumers and even voters are much more fluid in their loyalties, can the Minister not see a case for the support running with the donation, not necessarily the institution it is going to?

[Jane Ellison]

I understand entirely the point being made, but that takes us into issues relating to the motivation and behaviour of people as they give to charity. I think that relates more to the gift aid scheme itself than to the scheme at hand.

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I have already cited some evidence, and I will give some more. As appalling as the sad determination of some individuals to exploit charitable rules may seem to all members of the Committee, we have sufficient evidence across the range of charitable tax reliefs to believe with reasonable certainty that were any loopholes to be opened up, they would be exploited. It would be a sad situation if I had to come back to the House and say, “Actually, I was right. There has been a lot of fraud, we have lost a lot of public money. A number of small charities have had their reputations damaged as a result.” The evidence we have from the sector more broadly indicates that I am making a good working assumption that is well evidenced.

[Susan Elan Jones]

I am a bit concerned, because when we were here a few years ago the example we cited was the Cup Trust, where there was wide-scale evidence of fraud. We asked whether it was registered for gift aid and the answer was yes. I am concerned about linkage.

I appreciate that we are looking at is a review to do with gift aid six months after the Act comes into law, but in view of the changes made last time when we were told initially it had to be same for same—we ended up with something vastly different and vastly better—will the Minister look at those arguments? Even if the Government’s view is that there has to be some sort of matching, it need not necessarily be set at the current level. That is our big concern.

[Jane Ellison]

Two arguments are being advanced. One is that there should be no matching requirement at all. I am afraid I reject that for the reasons I have given, and I will try to provide more evidence. I understand the point that the hon. Member for Clwyd South makes and I understand that there was movement during the passage of the previous Bill with regard to the ratios. With all of these things it is sometimes about trying to strike a reasonable balance, and I think 1:10 is a reasonable number. It is an easy number from an administrative point of view and it keeps matters much more straightforward for the charities in question. I am glad however that she supports the principle that there should be a matching rule to avoid fraud. I will say a bit more about why we think that is important.

The Government’s own assessment found that 92% of charities claiming gift aid for the tax year 2014-15 claimed on donations of £500 or more. That would have allowed them to claim the maximum small donations top-up allowance, which at the time was £5,000.

It is worth adding that while the 8% of charities claiming on less than £500 of donations would not have benefited from the maximum small donations allowance because of how the matching rule operates, the vast majority would have been entitled to a proportion of that allowance. In fact, 98% of charities claiming gift aid in 2014-15 claimed sufficient amounts to receive a small donations allowance of at least £1,000. I submit to the Committee that with 98% of charities claiming enough to get an allowance of at least £1,000, the rules are not proving a barrier; they are being used and people are managing quite well with them. The figures do not support the assertion that the matching rule is a major barrier. Indeed, I think most people would say that it strikes the balance of reasonableness.

As I have said, the Bill is a simplification measure—it removes the two-year registration requirement and the gift aid history requirement—and leaves only the matching rule as the link between the gift aid small donations scheme and the wider gift aid scheme. The Government have always been clear that a link to gift aid is necessary to allow HMRC to carry out effective compliance activity. I ask hon. Members on both sides of the Committee to support that principle.

Small Charitable Donations and Childcare Payments Bill

Susan Elan Jones Excerpts

3rd reading: House of Commons & Report stage: House of Commons
Tuesday 15th November 2016 Commons Chamber

[Rebecca Long Bailey]

New clause 1 would require Her Majesty’s Revenue and Customs to publish in each tax year a report detailing the number of penalties imposed under the Small Charitable Donations Act 2012 and the circumstances giving rise to the imposition of such penalties; HMRC’s assessment of the extent to which charities have been established or have operated for the primary purpose of securing benefits from the small donations scheme; and an assessment of the evidence available on the role of the gift aid matching rule in preventing fraud and abuse. New clause 2 would require the Government to conduct a review of the operation of the gift aid matching rule, which is the rule that the total gift aid donations operation for a charity must be 10% or more of the amount of small donations on which top-up payments are made. The new clause stipulates that the Chancellor should consult charities and other relevant organisations about the role of the matching rule in preventing fraud and abuse, and the appropriateness of exercising the Treasury’s powers to amend or abolish the rule. New clause 4, which was tabled by the Scottish National party, would also require the Chancellor to assess the impact of abolishing the matching requirement.

During the Bill’s passage through the House, we have had extensive debates about the matching requirement—rightly so, because it is the biggest issue affecting the efficacy of the scheme, according to the charities that use it. The sector thinks broadly that the requirement is arbitrary and is a significant barrier to charities being eligible for the scheme. A consultation with members of the National Council for Voluntary Organisations showed that it is the most significant barrier to access for smaller organisations. The survey found that 50% of respondents with an income under £10,000 wanted the removal or reduction of the matching requirement.

Ahead of Second Reading, the NCVO argued that the Government have presented no evidence to demonstrate the extent to which the matching requirement is a necessary mechanism to prevent fraud and error, or that the matching ratio of 1:10 is the minimum necessary to achieve this objective. Despite considerable debate on this matter, we have got all the way to Report and the Government have still failed to provide any evidence that the matching requirement works. I would welcome the Minister’s comments on that today.

New clause 2 would force the Government to produce evidence in the form of a review and report on the operation of the gift aid matching rule, and whether it should be changed or removed entirely. New clause 4 would require a similar review, so we will be happy to support that measure. I would rather not have to press our new clauses 1 and 2 to a Division unless we have to. They call for a review of something that the charity sector says is hindering the scheme. I hope for some movement from the Minister on the issue today, but if the SNP’s new clause is pressed to a Division, we will support it wholeheartedly, as it reflects many of the principles that we have outlined in new clauses 1 and 2.

I am sure that the Minister will repeat her argument that the matching requirement is necessary to prevent fraud. I agree that we need measures to safeguard against such abuses. The Charity Commission has provided figures showing the extent of fraud in the charity sector. In 2014-15, 417 serious incidents involving fraud and/or theft or the misapplication of funds were reported by charities to the commission, and 255 operational compliance cases were completed. As Members are aware, just last week the commission announced in a press release that it was investigating the charity Our Local Heroes Foundation. According to the commission, it had received information about a proposed disposal of land owned by the charity, concerns regarding the founder of the charity receiving significant personal benefit through the charity, and a complaint that the charity was receiving only 20% of funds raised through a fundraising company.

This is just one case, but it is a sad example of charities being used as vehicles for tax avoidance and fraud. It is therefore incumbent on us to make it as hard as possible to abuse charitable status. That is why we have tabled new clause 1, which would require a review of the prevention of fraud and abuse in the small donations scheme. As I said, the review would need to address the number of penalties imposed under the Small Charitable Donations Act 2012 and the circumstances giving rise to the imposition of such penalties. It should include Her Majesty’s Revenue and Customs’ assessment of the extent to which charities have been established or have operated for the primary purpose of securing benefits from the small donations scheme, and HMRC’s assessment of the evidence available on the role of the gift aid matching rule in preventing fraud and abuse.

The Government’s guidance on the scheme explains that if a charity or community amateur sports club

“incurs a penalty in respect of an incorrect Gift Aid claim or GASDS”—

gift aid small donations scheme—

“claim, it won’t be eligible for the scheme both for the tax year in which the incorrect claim was made and in the following tax year.”

I would argue that the link between gift aid and the scheme is stronger than the matching requirement. Charities claiming gift aid can still be, and indeed have been, fraudulent organisations, so simply having a monetary link to the gift aid is not enough. This provision—that if a gift aid claim is wrong, a charity cannot claim through the scheme for that tax year and the following tax year—seems to be a stronger safeguard against fraudulent organisations than the matching requirement. Things might be more complex than that, but a review would clearly be beneficial, because we could assess where the matching requirement actually works effectively. In that way, the Government and the charities sector would be able to see clearly which anti-fraud measures were most effective.

New clause 3 deals with a different matter. Members and the Minister will remember that we made the case in Committee that certain groups—the girl guides, the scouts, and the Army, Navy and Air Force cadet groups—were not able to get the full benefit of the small donations scheme. That was after feedback from the respective charities’ representatives that, because of the structure of the groups, they were able to make only one claim for the entirety of the group, even though individual groups within them fund themselves.

The Minister responded that the measure proposed in Committee was unnecessary because the Bill allowed for what it proposed. She neatly illustrated why she would reject it—because, at the time, it carved out a few selected charities—but we want provisions to benefit a broad range of charities, some of which were not named in the original new clause tabled in Committee.

New clause 3 attempts to address the Minister’s points by allowing the Treasury to make regulations to exempt certain organisations from the connected charities rules. The Government would have to consult the Scout Association, the Guide Association and the Combined Cadet Force Association, in particular, before publishing those regulations. The Minister said she would reflect on the points raised in Committee, so I hope that she will accept the new clause today. It would not carve out a few selected charities, but give the Government the power to consult organisations that are mistakenly affected by the connected charities rules. It would, therefore, make the scheme run more smoothly, which is, after all, the point of the Bill.

I hope that the Minister has listened carefully to the rationale behind the new clauses and recognises that we are genuinely trying to achieve the same end: to make the gift aid small donations scheme work as well as possible for as many charities as possible. I hope that the new clauses will be accepted. We will not press new clauses 1 and 2 to a vote, but we will divide the House on new clause 3, and we will support new clause 4 should the SNP choose to press it to a Division.

[Susan Elan Jones (Clwyd South) (Lab)]

I speak in support of the points made by our shadow Minister about new clauses 1 and 2, which deal practically with the issue of fraud and put the onus very simply on HMRC to establish the extent of the problem. The difficulty facing the voluntary sector is that even with the £15 million of additional support in the Bill, the gift aid small donations scheme will distribute roughly £40 million, which is only about a third of the £115 million that was, according to Government opinion, projected to be distributed next year. This scheme could and should be growing. It is important because it helps and develops the smallest charities, and that must continue.

--- Later in debate ---

[Susan Elan Jones]

I accept that the Minister may want to keep the matching rule to some extent, but what is so sacred about 1:10?

[Jane Ellison]

I will say a little about that. As other hon. Members have said, there was movement on this during the passage of the original legislation. The figure is reasonable and strikes a sensible balance. A ratio of 1:10 is an easy one for those administering this to remember. If hon. Members accept that the matching rule is sensible in principle, I am prepared to say that it is something we would anyway keep under review in the normal course of events. The civil society Minister and I were saying to each other on the Front Bench a moment ago that, given hon. Members’ interest in this, we will keep an eye on it in particular and draw it out in the ongoing dialogue that we naturally have with charities. However, I cannot accept that removing it entirely is a good idea. These things are kept under constant review, and both the Treasury and the civil society parts of Government have a very good relationship with the charities sector, so we will have plenty of opportunities to continue to have such a dialogue with charities and to understand where this comes in. In a few moments, I will say a little more to demonstrate that it is not the barrier that some hon. Members have suggested it is.

Let me turn to new clauses 2 and 4. New clause 2 is a request for a review of the matching rule in consultation with the charity sector. As I have said, the Government have already undertaken a full review of all aspects of the gift aid small donations scheme, including the matching rule, and the Bill is a result of that review. However, I will always be happy to keep an eye on this issue. The Government’s review was comprehensive and open, and it was carried out in full consultation with the charities sector and, indeed, with anyone with an interest in the scheme or in charity tax reliefs more generally. Some hon. Members will recall that, as I have said, back in 2012, the Government committed to reviewing the operation of the scheme after three years, so the Government have made good on that promise.

We recognise how important the scheme and the promised review were to charities. We listened to the sector, and that is why we announced in the autumn statement last year that we would bring forward the review of the scheme to December 2015. To inform the review, HMRC published a call for evidence in December, seeking charities’ views about the operation of the scheme, including its eligibility rules and processes. The call for evidence asked five questions about the scheme’s eligibility criteria, including two questions specifically about the gift aid matching requirement. The call for evidence closed on 2 March. HMRC received 197 responses from charities, representative bodies and other interested parties. The Government reviewed all the submissions and published a response on 20 April.

In the responses document, which is available on the Government’s website, we explain that the vast majority of—indeed, almost all—the respondents to the call for evidence did not identify the matching rule as a major barrier to accessing the scheme. The Government recognise that many of the responses reflected the experience of charities already successfully using the scheme and may not therefore be representative of the sector as a whole. We take that point, so HMRC has supplemented the data provided by charities with an analysis of its own data. As I explained in Committee, the data showed that 92% of charities claiming gift aid for the tax year 2014-15 claimed on donations of £500 or more, entitling them to the maximum small donations allowance at that time of £5,000. HMRC’s analysis also showed that 98% of charities claiming gift aid in 2014-15 claimed sufficient amounts to receive a small donations allowance of at least £1,000.

The Government also considered data produced by the charity sector. A survey carried out by the National Council for Voluntary Organisations, the Charity Finance Group, the Institute of Fundraising, the Small Charities Coalition and the Association of Independent Museums found that just 5% of respondents claimed no gift aid at all, and only 10% did not feel that their charity claimed enough gift aid to make the small donations scheme worthwhile.

Following the call for evidence, HMRC published a further consultation on reform options on 20 April, which was yet another opportunity for stakeholders to put forward reform ideas for consideration. That consultation closed on 1 July this year. It received 46 responses. Again, interestingly, the matching rule was not raised as an issue by the vast majority of respondents.

Quite simply, none of the available data, whether produced by the Government or the sector itself, support the assertion that the gift aid matching rule is a significant barrier to accessing the small donations scheme. The Government have already collected data on the matching rule, carried out a full objective review of the whole scheme and consulted the charity sector. That is why we believe that repeating the consultation process again, so soon after the last consultation, would not produce a different outcome, and why, therefore, I urge the hon. Member for Salford and Eccles not to press new clause 2 to a Division.

As I have said, given the clear interest in the House, we will continue to take a keen interest in this matter, and will listen to the views of the charity sector. The civil society Minister and I are already talking about how we can do more to publicise some aspects of the scheme, and in particular how to get those that do not take advantage of the small donations scheme at the moment to do so. There is a charities day on 16 November, about which we will say a little more later; that will be an opportunity to say and do more to promote the scheme to that small minority not already using it.

I appreciate that in tabling new clause 4 the hon. Members for Aberdeen North and for Kirkcaldy and Cowdenbeath (Roger Mullin) are seeking to understand the differential impact that abolishing the matching rule would have on charities of different sizes. I have already set out why we do not support the removal of the gift aid matching rule, but I have to tell Opposition Members that it is simply not possible to provide them with the level of analysis that they are seeking. Although HMRC holds data on charitable tax reliefs, it quite rightly collects and retains only those data that are necessary to support its function of administering gift aid and other reliefs. Size and turnover are not relevant for gift aid purposes; HMRC therefore does not routinely collect data on the size or types of charities claiming gift aid or small donations top-ups.

As I explained in Committee, HMRC is transparent with the data it holds, and publishes a national statistics package every year that provides a wealth of information about the take-up and use of charitable tax reliefs, including the gift aid small donations scheme. Hon. Members may also be interested to know that HMRC makes many of its datasets, including those relating to charitable reliefs, available—suitably anonymised, of course—to academics and other individuals who approach it with a suitable research proposal. I can tell the House that a number of organisations have recently made use of HMRC’s charities data for research purposes. That is a good example of open government and open data being put to good use.

I hope I have reassured the hon. Member for Aberdeen North that where HMRC possesses data, those data are transparent and, where appropriate, open to outside scrutiny. New clause 4 is not appropriate, because it would require, in legislation, the Government to do something that we simply cannot do. On that basis, I hope the hon. Lady will consider not pressing the new clause to a Division.

Let me turn finally to new clause 3. As I have explained in previous debates, the connected charities rules are intended to protect the gift aid small donations scheme from abuse. They work in conjunction with the community buildings rules to deliver fair and broadly equal outcomes for charities structured in different ways. Without the connected charities rules, larger charities would be faced with a perverse incentive to splinter into artificial groups of smaller charities to increase their entitlement to small donations allowances. New clause 3 would grant the Treasury the power to exempt specific named charities from the connected charities rules. It would also require the Treasury to publish draft regulations, following consultation with the scouts, the guides and others.

The new clause is unnecessary. As we have heard, the Government have just concluded a full and open review of all aspects of the gift aid small donations scheme. That review included the gift aid matching rule and the connected charities rules. In that very open consultation, many representations included the scouts and other uniformed groups. The Government listened to the representations from the uniformed groups. They told us that they welcomed the gift aid small donations scheme, but were unable to benefit fully from the current community buildings rules because most of their fundraising, as Members will know, takes place outside in their local community. The Bill will therefore relax the community buildings rules to allow donations collected outside the building to be counted for community buildings purposes. As discussed on Second Reading and in Committee, this will help bob-a-job work and so on that is done outside the scout hut or other building.

The intention is to allow groups such as the scouts to benefit more fully from the scheme without the need to specifically exclude them from the connected charities provision. We debated a similar amendment in Committee and had a thorough and thoughtful debate on the implications of the Bill for the youth groups in question. The shadow Chief Secretary raised a number of good points and I undertook to reflect on them and look at them more closely. Having done so, I confirm to the House that a scout hut is an eligible community building and there is no requirement for the building to be rented out or for access to be granted to other community groups. That means that the scouts and other similar uniformed groups will benefit from the changes contained in the Bill. Whether it is bag-packing at the local supermarket or bucket collections at the local fete, donations in the local community will count for the small donations scheme. The Bill’s provisions already deliver the outcome Opposition Members seek. I therefore suggest that new clause 3 is unnecessary and I hope the hon. Lady will withdraw it.