According to the latest research, just 10-12 per cent of ultra-high-net-worth individuals, defined as people with a net worth that exceed £10 million are actively engaged philanthropy. The data was released by the Beacon Collaborative and come after a new All-Party Parliamentary Group on philanthropy was established. The group was established in July with the goal of encouraging greater philanthropy in the UK.
Range of new programs could be funded
MP Rushanara Ali who is a member of the group says that if more of the super-rich in the UK became philanthropists, i.e. an additional new philanthropist for every ten that are already giving money, it would raise £2 billion that could be used to fund a wide range of programs. The new parliamentary group will work with all members of Parliament and the Beacon Collaborative in order to connect MP’s to philanthropists, social investors, trust and foundations.
The number of people giving has dropped
In the UK there are 18,000 individuals defined as being ultra-high-net-worth and the median amount they give to charity according to data from the Beacon Collaborative. Previous research undertaken has shown that in the UK, the number of people featured on this year’s The Sunday Times “Rich List” who give more than 1 per cent of their wealth to charity has declined from 86 last year to 72 this year. There are multiple reasons behind the drop in philanthropy.
According to John Pepin CEO of Philanthropy Impact the UK is trending against a cultural change that has been around for a very long time. He cites a lack of knowledge among advisors of wealthy individuals as well a British culture that does not celebrate philanthropy. This is quite different to the culture that exists in the US where philanthropy is expected and is actually the topic of conversation at dinner. In the UK there is no sense that with wealth comes social obligations.
Political uncertainty to blame
There are people that argue that political uncertainty has resulted in more high-net-worth individuals in delaying giving to charity. There are real fears that there will be higher taxes under a potential government headed by Labour Party Leader who is hard-left. In general, when there is economic uncertainty, people tend to be less generous. In order to reach the £2 billion goals is therefore challenging, however when the numbers are crunched, that adds up to just an additional £1.1 million from 1,800 individuals. That in reality when it comes to the one per cent is the equivalent of pocket change.