The Charity Finance Directors Group has called for simplification in the 2008/2009 Budget, in order to prevent charities from being unfairly penalised by over-bureaucratic rules and regulations.

The CFDG submitted its recommendations to the Treasury, which covered a number of areas that it said were in need of simplification or review. These included: reinforcing the joint Gift Aid proposal made in response to last year’s HMT consultation; addressing irrecoverable VAT; and reviewing both the tax anti-avoidance legislation and its effect on substantial donors, and the regulations governing loss-making subsidiaries.

Keith Hickey, CFDG’s chief executive, said: “It is critical that the government takes account of the needs of a voluntary sector that plays an ever more critical role across a broad range of communities and services. The government needs to look very carefully to the rules around Gift Aid, payroll giving and substantial donors, in order to make sure that charities are fully able to benefit from public giving.”

The CFDG has also voiced its opposition to extending the scope of the Freedom of Information Act to charities delivering public services on behalf of government. The umbrella group said that charities delivering public services were already accountable to the public authority via their service delivery contracts, which likely contained all the information necessary for an FOI request.

However, according to CFDG’s policy and campaigns manager Ernese Skinner, charities would face significant set up costs if they were to take on responsibility for FOI requests. “They would need to train staff and put in place appropriate systems and processes to answer the FOI requests in the given timescales – all of which would take them away from the day to day running of the charity,” she said.