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31 July 2017

A clean Brexit will let Britain’s charities get on with helping the most disadvantaged

by Andrew O'Brien

Originally published by Brexit Central.

Brexit is going to lead to fundamental economic, political and social changes regardless of the outcome of the negotiation. However, so far nearly all the focus has been on the first two and hardly any discussion has been had on how Brexit can build a better society. This is worrying because people voted for Brexit because they wanted Britain to become a better place to live. Moreover, many Remain supporters are also concerned about the potential impact of Brexit on the country.

If the Government doesn’t use Brexit to try and improve lives, particularly the most disadvantaged, then it is in danger of betraying the aspirations of the British people.

The early evidence is that the public is not convinced that Brexit is going to deliver for them. When Charity Finance Group asked ComRes to poll the public about who they thought the government was prioritising in the Brexit talks, 27% of respondents said that wealthy people and communities were getting prioritised most and 16% said British businesses, the same level as agreed that the British public were being prioritised most. Only 5% thought that “people like me” were being prioritised most and just 2% thought that disadvantaged people and communities were being prioritised.

Although people voted for Brexit to deliver change, the public’s view is that the Government is still focused on elite concerns and not enough on improving their lives.

Charities are critical to delivering positive social change. Research indicates that 83% of people use the services that charities deliver and charities leverage billions of pounds every year for good causes. As the #EverybodyBenefits campaign by the Directory of Social Change has highlighted, there is hardly a part of society that does not benefit from the work that British charities do.

So if the Government wants to build a better society post-Brexit, then it needs to work with charities. As our new analysis highlights, there are opportunities in leaving the EU which the Government can use to deliver a Brexit which works for everyone.

It is undeniable that charities have benefited from some aspects of being in the EU, particularly in accessing skilled staff, funding and through cross-border collaboration. However, other aspects of being in the EU have created challenges, both financial and in terms of red tape, which have held us back. For example, VAT rules are costing charities nearly £1.5bn a year because the tax is not designed with the activities of charities in mind. Similarly, State Aid rules – which were supposed to stop governments from propping up businesses and preventing competition – have become excuses for officials not to act when there is a pressing need to do so.

With new-found powers, the government can change the rules to make the state and charities more effective in dealing with the social challenges that our country faces.

The UK will only be able to make the most of these if it gets the right deal. But the EU’s negotiating position seems to indicate that if we want to stay in the Single Market and Customs Union, then we need to agree to keep the EU’s rules on tax and regulation. Our concern, as highlighted in our analysis, is that this would create the worst of both worlds for charities. We’d be subject to all the rules but without the ability to change them to make them work for British society.

This is a significant risk that must be avoided. The least risky option, as things currently stand, is a ‘clean Brexit’ – which means that the EU leaves the Single Market and Customs Union and gets the power to change things for the better. The UK could achieve the same outcomes through a negotiated settlement, but given the EU’s red lines and the challenges in securing all the necessary exemptions and powers needed to change things, this looks very tricky.

UK charities want to see a deal that works for our economy and our society. But just focusing on the needs of businesses that trade with the EU means that we could end up getting a deal that only helps a small portion of the population. The Government needs to be much bolder than this and think how about how a deal could help everyone.

Charities know what the solutions are, but government needs to reach out now and ensure that they are given a seat at the table.

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