Our museums are charities funded by a mixed economy of public funding, earned income and charitable donations. The UK’s national museums have a strong record in attracting donations but we believe there is scope to encourage greater philanthropy in the UK.
Many UK museums were founded through the contributions of individual philanthropists, driven by the conviction that citizens' quality of life would be enhanced by access to important objects, imaginatively interpreted within a core educational purpose. Building on this legacy, Britain's major cultural institutions came together to launch, Private Giving for the Public Good, opening a nationwide campaign to encourage a culture of giving to the arts and heritage. As public funding falls, museums’ efforts to increase funding from other sources has become even more important to maintain the quality and diversity of their public programmes along with outstanding levels of visitor satisfaction.
The NMDC feels strongly that, to support a change in the giving culture, all signals for promoting philanthropy should point in the same direction. Such an approach should include an unabashed celebration of philanthropy, public recognition of the contribution made by philanthropists, and fiscal incentives to encourage a culture of giving.
Understanding what motivates museum visitors to give
NMDC has joined together with the Art Fund on a new research project aiming to understand why comparatively few museum goers donate when visiting museums, and to discover what will motivate them to give in future. The research by Britain Thinks will stimulate new ideas and approaches that we hope to pilot in a range of museums across the UK from spring 2013.
New research by Arts & Business confirms that individual donations to the arts are falling year on year, down from £120 million in 2008/09 to £73 million last year. Although museums have become increasingly successful at raising funds from a variety of streams – including commercial income, trusts and foundations and corporate supporters - donations from individuals are usually concentrated around a few high level donors. The NMDC/Art Fund project aims to help museums better understand their audiences, the barriers and motivations to giving, and help to improve fundraising strategies.
Tax incentives for charitable giving
NMDC welcomes the Coalition Government’s commitment to cultural philanthropy and has been encouraged by the range of Government activity including improvements to Gift Aid, promotion of legacy giving and the new Cultural Gifts Scheme.
Our members were deeply concerned about the potentially devastating impact of proposals in the 2012 Budget to limit tax relief for charitable donations. UK museums have been major beneficiaries of the generosity of wealthy individuals, particularly for capital development projects. NMDC joined voices from across the charity sector calling for charitable donations to be exempted from the cap, and was delighted to see that Government listened to our concerns.
In May 2011 the Government published the Giving White Paper, outlining its priorities and approach for encouraging philanthropy.
Gifts of pre-eminent objects and works of art to the nation
In January 2012, the Department for Culture Media and Sport published guidance on the Cultural Gifts Scheme (CGS) which will enable individuals and companies to donate pre-eminent and associated objects to cultural institutions in exchange for reductions in income tax, capital gains tax or corporation tax. NMDC has welcomed the Government's proposals to encourage gifts of pre-eminent objects and works of art to the nation, which reflects our response to the Giving Green Paper. The proposed scheme will, if it is well designed, crucially help to support the formation of long-term and life-time relationships between individual and corporate donors and cultural organisations. NMDC also welcomed the announcment in Autumn 2011, that the annual limit for this scheme and objects Accepted-in-Lieu of Inheritance Tax has been increased to £30m .
Read NMDC's response to the Government consultation Gifts of pre-eminent objects and works of art to the Nation. Further information on the proposed scheme can be found on the HM Treasury website.
Legacy10, a nationwide campaign aiming to increase the number of people who leave money to charity in their wills, was launched at Tate on 2 November 2011. At present only 7% of people leave money to a charity in their will, though 56% of adults donate to charity in an average month.
The Legacy10 campaign encourages people to leave 10% of their legacy to charity. In his Budget statement 2012 this year, the Chancellor announced new Inheritance Tax rules aimed at encouraging charitable giving. From April 2012, any estate that leaves at least 10% to a charitable or cultural cause is able to take advantage of a cut in Inheritance Tax from the current level of 40% down to 36%.
For further details see NMDC Newsletter, November 2011
In April 2008, Britain's major cultural institutions came together to launch a new manifesto, Private Giving for the Public Good, opening a nationwide campaign to encourage a culture of giving to the arts and heritage.
The campaign calls for greater support to encourage a culture of giving and wider recognition of the contribution made by cultural philanthropists. Many UK cultural institutions were founded through the contributions of private benefactors who wished to give something back to their communities. The aim is to encourage the philanthropists of the future.
There are a number of specific strands of activity/policy which would fulfil that agenda:
- Incentives to encourage gifts to British collections
- Reforms to Gift Aid
- Lifetime Legacies
- Capacity building in the sector.
NMDC's response to the 2007 HM Treasury consultation on Gift Aid can be found here.