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Behind the scenes with the levy team

Caroline Trabasas, Fundraising Regulator

When the levy was introduced in 2016, we said we’d make no changes to it for three years. As we approach year 4, the team and I have been exploring options to build on the levy. Here’s a quick look at what’s been going on.

To start, we considered whether we could change the levy using income as its basis, or even a hybrid option that included both income and spend. We created scenarios based on the financial accounts of typically large, medium and small fundraising charities within the levy, to see if we could draw any useful conclusions.

We also focused on reviewing the current spend model that has a progressive banding system. We’ve looked closely at the bands, experimenting with several different scenarios that introduce new bands, and some that introduce none at all.

We’ve spent a lot of time checking charity accounts to compare and analyse them. There are around 1900 charities in the levy, each with 3 sets of accounts to look at – that’s 5,700 accounts altogether. To be absolutely sure, we’ve also calculated the number of charities in each band to work out the levy as a proportion of what they spend on fundraising.

After all this, we put forward many detailed scenarios to the Finance, Audit and Risk Committee and the Board, to show the wide range of possible changes available. They discussed the pros and cons for each option, and for continuing on the current levy structure over the next few years.

They didn’t want to change things too much for charities, and that’s why we kept the current formula. They agreed to add a couple of changes to improve the progression for smaller fundraising charities, and to move to the most recent reported costs.

We hope charities agree that this is the fairest option for the year 4 and 5 of the fundraising levy.

Caroline is the Levy and Registration Manager at the Fundraising Regulator.