by molly frankcom
Earlier this month we saw the appointment of Kier Starmer as head of the Labour party and the UK’s new Prime Minister. We have been spending some time understanding what this means for the charity sector and how new Labour policies may affect the work carried out by our clients.
What are the main takeaways from Labours election campaign?
During their pre-election campaign the Labour Party shared that they wanted to tackle the root cause of the issues which fall to charities to address, and this seems to remain the case upon their election into government. This may mean some charities, at some point in the future, cease to exist or be needed. However, without a significant injection of funding currently it is likely that charities will still be instrumental in providing their services and expertise to meet demand. This focus, along with Keir Starmer’s ‘Society of Service’ (referenced at the Labour and Civil Society Summit in January this year), signifies that the Labour government are wanting to to engage with the charity sector constructively and collaboratively.
Labour’s priorities align with its five key missions to rebuild Britain (economic growth, clean energy, safe streets, equal opportunity, future-ready NHS). They have explained that the delivery of these missions will be carried out via new ‘mission delivery boards’ sharing that their top priority is economic growth. To kick-start this, the Treasury is establishing a ‘growth delivery unit’ and a growth mission board. In a blog written by NCVO they share that ‘Any organisation hoping to engage with Labour will need to frame their approach around how they can help the new government to achieve these key missions.’
What relationships do MP’s have with the charity sector?
· More than 1/3 of MP’s (242) have a charity sector background.
· Cabinet ministers have much more direct experience with charities. 8 members of Labours cabinet have worked in charities vs 2 members in Sunak’s, Conservative cabinet.
· Many appointments to cabinet have prioritised those with lived experience, rather than just political experience.
Policies which may affect the sector/ Productle clients:
· The Labour party manifesto pledges to end private schools VAT exemption on fees and business rate relief, discussions are ongoing around the rate of VAT, but predictions expect these charges to be approximately 15-20%. Calculations estimate this to raise £1.6 bn a year, which is to be invested into state school education (recruitment of new teachers etc). There is a possibility some schools affected may choose to fundraise the difference.
· Labour MP’s have tried to manage expectations concerning injections of funding into the sector, sharing ‘there will not be tonnes of funding’. However, investment into health, social care and education sectors may reduce reliance on charities who work with vulnerable people within these areas.
· There has been heavy discussion on ‘working in partnership’ with civil society and the charity sector, especially due to the prior relationships many MP’s have with the sector. What this will entail is yet to be discussed specifically in the short term.
Key upcoming dates to be aware of:
· 17th July, Kings Speech, will outline Labours legislative agenda, billing plans to prioritise in the next few months.
· 31st July, likely date for Parliamentary recess.
· 2nd Sept, likely date for Parliaments return.
Autumn budget (Date TBC), importance of this is emphasised as economic growth is the no.1 mission for the Labour government.
