A new guide published by UK Community Foundations outlines a simple service for Local Authorities to unlock the potential of inactive assets that they may be currently managing, for the benefit of their communities.
‘Building Resources for Local Community Groups’ aims to encourage Local Authorities in England and Wales to work with their local community foundation to utilise inactive charitable trusts. The guide has been developed by UK Community Foundations in partnership with the Charity Commission, and is supported by the Department for Digital Culture Media and Sport, the Local Government Association, the Chartered Institute of Public Finance and Accountancy, and CCLA.
Over time, the Objects of many charitable trusts have become dated – the original founders and trustees have passed away and the value of their assets has declined with inflation or, in some cases, poor investments. Many are now relatively small pots of money, making it more difficult to continue to ensure they have a meaningful and local impact.
Many charitable trusts such as these ended up being managed by their Local Authority to ensure that their funds remained safe. Virtually every Local Authority across England and Wales has, over time, managed or administered charitable trusts for and on behalf of members of their local community.
UK Community Foundations’ research and experience has revealed that many of these trusts are now inactive. Some local authorities may not even be aware of their existence, but it is likely that almost all local authorities have an inactive trust they have some responsibility for. The exact value of these trust funds is not known; however, it is estimated that it runs into the hundreds of millions of pounds across Local Authorities in England and Wales.
If just a small percentage of these trusts can be reactivated, it could make a huge difference to local communities. As Local Authority funding is reduced over time, they have fewer resources to manage these trusts. However, the importance of ensuring that charitable resources are being used to meet community needs has never been greater.
This guide outlines the process of reactivating inactive assets, giving practical steps and advice for achieving this.