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Frequently asked questions
The Government is committed to creating a fair and enterprising society, and strongly supports the role that the third sector can play in building strong and vibrant communities, including through delivering public services and encouraging voluntary participation in the local community.
The third sector comprises non-governmental organisations which are value-driven and which principally reinvest their surpluses to further social, environmental or cultural objectives. It includes voluntary and community organisations, charities, faith groups, social enterprises, cooperatives and mutuals. The third sector is large and growing, particularly in the area of social enterprise, and plays an increasingly important role in both society and economy.
The Government has put in place a wide range of support to the sector, both through the tax system and through public spending on policy initiatives designed to build capacity and provide the sector with the means to help to provide public services. For example: the 1998 Compact set out the agreement between Government and the third sector on how best to work together; in 2000 the Getting Britain Giving package increased and enhanced the tax reliefs available on charitable gifts; the 2002 and 2004 Cross Cutting Reviews set out measures to give the third sector a stronger role in public service delivery, leading to increased public expenditure through initiatives such as Futurebuilders and Change Up; and the Government has promoted increased levels of volunteering through the 2005 Year of the Volunteer and support for the implementation of the Russell Commission recommendations. The Government has now launched its revised Guidance to Funders, which will promote the relationship between the third sector and Government, in public service delivery and further the principles embedded in the Compact. The Government has also launched a Guide to Government Assistance to the Third Sector , which provides an overview of the key sources of financial support available to the third sector, and aimed at third sector organisations seeking support for activities that benefit the community.
The Charity and Third Sector Finance Unit is responsible for strategic policy development across HM Treasury on third sector issues. The Unit acts as a Director-led policy and strategy network in the Department, bringing together all aspects of tax, spending and financial services policy. The Unit will work closely with the Cabinet Office, as the lead Department on the third sector, including social enterprise, and HMRC, who are responsible for taxation issues and the operation of reliefs for giving.
The Unit will work in partnership with the Cabinet Office to conduct the largest programme of engagement undertaken with the third sector, seeking views from a wide range of organisations in every region, for a policy review on the future role of the third sector in social and economic regeneration. This review forms part of the groundwork for the 2007 Comprehensive Spending Review, and marks a new phase in the relationship between Government and the third sector, driven by an open and genuine dialogue.
A decade on from the first Comprehensive Spending Review, CSR2007 will look at the further steps that are necessary to meet the challenges and opportunities of the decade ahead.