Why persuading the rich to give to the poor is important (GUARDIAN)

[THE FUGITIVE]

We face years of austerity and as incomes and tax revenues are declining, charitable giving is either falling or stalling. Inequality in Britain is increasing faster than most rich nations â€" it is no coincidence that the most unequal societies are also the most dysfunctional. More tax cannot be the solution without international agreement and while we continue to vote for parties who are against increasing tax and for maintaining non-dom status for UK citizens.

What has this got to do with charitable giving and why should we be bothered if it is falling? We have been giving since the beginning of time. We are programmed to be altruistic as well as competitive; just as the need to eat and procreate is rewarded by feeling good, the same applies to giving. Philanthropy helped us to establish the civil society we enjoy today and enabled law, education, hospitals, welfare and culture to flourish long before the industrial revolution required the state to address growing poverty. Today, perhaps because of the unprecedented material prosperity and massive debt created in the past 60 years, we are losing the plot. Just over half of us give to charities regularly but we seem to be giving less; the poor give proportionately more than the rich and only a small minority of the very rich are being philanthropic.

As austerity bites and some become even more selfish, we risk compromising our humanity as well as civil society. Tax cannot pay for everything; we need a strong voluntary sector. The challenge then is this: while the richest increase their wealth and the remainder grow poorer, how do we reverse the decline in charitable giving and persuade the rich to commit to civil society, both by paying tax and giving? What should the government do to encourage more philanthropy? How do we create a better society if not a big one, while the state is in retreat?

As research for my book Giving Is Good For You, I put these questions to 80 people who give or receive. Many believe that all UK passport holders should pay British taxes wherever they live; national honours should not be given to those who do not pay tax; business leaders should not be given honours unless they can prove they are charitable; there should be more honours for those who volunteer and give. Tax relief should be extended and simplified to motivate more donors, underpinning the principle that tax is not paid on money that is donated. However, to justify spending more public money to stimulate private giving, tax relief should be limited by a much stricter definition of public benefit.

The government and voluntary sector must learn what motivates donors, who are free to choose whether to spend their money on private pleasure or for public gain, although there should not be the expectation that philanthropy can
compensate for reduced public expenditure. A national philanthropy strategy for the voluntary sector should have all party backing to ensure long-term planning by charities and commitment by donors.

Both the private and public sectors have hit the buffers and this gives us the opportunity to create a new social contract if politicians are up to the challenge. Philanthropists believe we should teach our children empathy as well as the virtues of a civil society and the role we should all play in sustaining it. There should be a national diploma for those at school who show commitment to the needs of others, an award that is valued by higher education and employers.

The "big society" may be a fantasy, made toxic by being politicised, but we can create a "better society", in which all should pay tax and everyone, whether giving time or money, can be a philanthropist.

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