I've written several times about the problems with the way in which the taxpayer finances the charitable sector via the state (all in it costs us a minimum of £6.5bn a year in lost tax revenue). But this week brought one of the most maddening illustrations of the way all this works yet.
The True and Fair Foundation (which lobbies for more efficiency in the charitable sector and is much loathed by much of the sector) has been having a look at the finances of the charity shops that line pretty much every inch of our high streets.
There are now around 10,500. They get 80% off business rates. They pay nothing for their stock (it is mostly donated). And they pay very few of their staff (most workers are volunteers). They should be making a killing. But here's the shocking thing: they aren't. Despite all their advantages, a very large proportion of them bring in very little money for the charities they are supposed to support.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Overall, the shops made total (tax-free) profits of around £290m last year. But they got anything from £273m to £1.6bn worth of tax breaks alone the way. How's that for a lousy deal for taxpayers?
The shops keep a lot of volunteers busy and engaged with communities (which is nice); they clearly help with the recycling of used goods inside our economy (also nice); and they divert some cash from consumers and from HMRC to various charities (something this is nice, sometimes it is not).
But that all comes at a cost one that, from this report at least, looks to be rather too high.
-
UK inflation slowed again in March – but a rate cut could be some months awayThe latest Consumer Price Index (CPI) data came in at 3.2% for March. This was slightly higher than some economists expected, but takes us closer to the Bank of England’s 2% inflation target.
-
Pension vs property: which option provides the best income for your retirement?News With the cost of a comfortable retirement on the rise, future retirees need to weigh up which strategy offers the best returns. But is a pension a better bet than property?
-
Beating inflation takes more luck than skill – but are we about to get lucky?Opinion The US Federal Reserve managed to beat inflation in the 1980s. But much of that was down to pure luck. Thankfully, says Merryn Somerset Webb, the Bank of England may be about to get lucky.
-
Rishi Sunak can’t fix all our problems – so why try?Opinion Rishi Sunak’s Spring Statement is an attempt to plaster over problems the chancellor can’t fix. So should he even bother trying, asks Merryn Somerset Webb?
-
Young people are becoming a scarce resource – we should value them more highlyOpinion In the last two years adults have been bizarrely unkind to children and young people. That doesn’t bode well for the future, says Merryn Somerset Webb.
-
Ask for a pay rise – everyone else isOpinion As inflation bites and the labour market remains tight, many of the nation's employees are asking for a pay rise. Merryn Somerset Webb explains why you should do that too.
-
Why central banks should stick to controlling inflationOpinion The world’s central bankers are stepping out of their traditional roles and becoming much more political. That’s a mistake, says Merryn Somerset Webb.
-
How St Ives became St Tropez as the recovery drives prices sky highOpinion Merryn Somerset Webb finds herself at the epicentre of Britain’s V-shaped recovery as pent-up demand flows straight into Cornwall’s restaurants and beaches.
-
The real problem of Universal Basic Income (UBI)Merryn's Blog April employment numbers showed 75 per cent fewer people in the US returned to employment compared to expectations. Merryn Somerset-Webb explains how excessive government support is causing a shortage of labour.
-
Why an ageing population is not necessarily the disaster many people think it isOpinion We’ve got used to the idea that an ageing population is a bad thing. But that’s not necessarily true, says Merryn Somerset Webb.
