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Giving, philanthropy and creating a democratic society. Cathy Pharoah and Tom McKenzie

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Giving, philanthropy and creating a democratic society. Cathy Pharoah and Tom McKenzie

  1. 1. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Giving,philanthropyand creating ademocratic societyCathy PharoahTom McKenzie9 May 2013
  2. 2. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013What does democracy in giving mean for society? giving is spread between causes according to donor-market demand giver population represents the wider population giving itself redresses imbalances of power, wealth,and responds to need giving funds advocacy for a democratic society (Sanghera, 2012) through tax reliefs government yields spending power to citizensand promotes pluralism
  3. 3. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Representing the population Spending power Age Household type Population trends
  4. 4. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 201301020304050percentageofhouseholdsdonating0 20 40 60 80 100expenditure percentile1978-1982 2004-2008Participation in charitable giving in the UK
  5. 5. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013020406080100cumulativepercentageoftotalspending0 20 40 60 80 100cumulative percentage of householdsy = x1978-19822004-2008Lorenz curves for expenditure in the UKChange in the distribution of money
  6. 6. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Participation and children05101520253035proportiondonating(%)1978 1983 1988 1993 1998 2003 2008yearhouseholds without kids households with kids
  7. 7. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Amounts and children02468102010poundssterling1978 1983 1988 1993 1998 2003 2008yearhouseholds without kids households with kids
  8. 8. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Generosity, age and children0.511.522.53donations,%ofexpenditure1978 1983 1988 1993 1998 2003 2008year21-40, no kids 41-60, no kids 61+, no kids21-40, kids 41-60, kids 61+, kids
  9. 9. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Representation of household types among donors01020304050percentone personlone parentmarried couplecohabiting coupleother multi-persondonors populationNote:Pooled datafor England,2001-2011.
  10. 10. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Representation in terms of amounts donated01020304050percentone personlone parentmarried couplecohabiting coupleother multi-persondonations populationNote:Pooled datafor England,2001-2011.
  11. 11. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Household types: estimates and projectionsfor England, 1971-2031Source:ONS populationprojections,table 402.
  12. 12. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Distribution between causes
  13. 13. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Proportions ofdonors to a causeand ofmoney donatedSource:UK Giving 2012,CAF/NCVO
  14. 14. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Charitable bequests by cause and genderSelected cause % estates with bequest % estates with bequestAnimal 28 20Worship 28 23Physical Disabilities 16 13Hospice/ hospital 26 24Culture 6 8Education 3 5Ex-Services 5 8Causes with similar proportions:Child welfare, rescue, medical research, nursing,overseas aid, cancer, elderly, environment, mental healthSource:Atkinson, A et al. (2009) Charitable bequestsand wealth at death in Great Britain, WorkingPaper A09/03, University of Southampton.
  15. 15. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Does giving have a ‘democratic deficit’?Is giving inherently democratic? Giving by amount does not reflect majority donor preference Giving population does not fully represent wider population, and gaps might grow The nature of giving reflects rather than redresses imbalances of wealth Donor tax reliefs increase citizen power, but not equally for everyoneDoes giving have the effect of increasing democracy and social justice? Better-off donors only partially respond to democracy and social redistribution Philanthropy is part of a pluralist society, but not inherently diverse or pluralistCould the contribution of giving to democracy and redistribution be increased?
  16. 16. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Role of tax reliefs In the UK, policy on donor tax reliefs intended to promote a democracy of giving Gift Aid initially for gifts of +£600 in single donation (Lawson,1990): thresholdgradually lowered to widen access to tax-breaks In 2000, New Labour Chancellor Gordon Brown abolished any threshold –‘Instead of charity seen in the old way, the rich bestowing favours on the poor, Iwant a democracy of giving, where all those who can, help all those whocan’t.’ (HM Treasury, 1999) All gifts became theoretically eligible for Gift Aid (Finance Act 2000) 90% tax-effective giving today is through Gift Aid, used by +one-third of donors Brown linked wider participation in giving with desirable redistributive effects
  17. 17. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Perverse incentivesWhy has tax policy not been more redistributive in its effects? Increased uptake is largely due to promotion of Gift Aid by existing charities Charities focus on gifts rather than potential givers when promoting Gift Aid Perverse incentive for charities to narrow target markets Tax-reliefs offer wealthier donors a greater incentive to give Less well-off donors will not necessarily give more support to social needs
  18. 18. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013Costs and opportunities in democratic deficit Do people think philanthropy is important? – does giving reflect what people canafford or what they choose to give? Would/ could they give more? Marginalisation of certain groups – less well-off, lone parents, co-habiting couples,one-person households (likely to increase) – failure to respond or failure in asking? Collateral loss – donations, inclusion, ‘voice’, engagement – the additional qualitieswhich giving can bring, and from which good causes might benefit Giving focus on married couple households - proportion in population likely todecline, and giving constrained by costs of children Social needs not getting enough support in time of prolonged recession Could charitable tax-reliefs be used to better effect to address democratic deficit? Encouraging altruistic, pro-social attitudes, and ‘voluntary redistribution’ – beyondbehavioural ‘nudges’ for individuals to give
  19. 19. Giving, philanthropy and creating a democratic society • Cathy Pharoah and Tom McKenzie • 9 May 2013

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