Scotland's major cultural institutions could lose their charitable status and the financial benefits that go with it, under rules set out in a draft charity bill being considered by the Scottish Parliament.
The bill is designed to modernise charity law in Scotland and ensure that charities are properly regulated, independent organisations.
All non-department public bodies (NDPBs), including the National Museums of Scotland (NMS), National Library of Scotland (NLS), and National Galleries of Scotland (NGS), will be affected by the rules set out in the Charities and Trustees Investment (Scotland) bill.
These state that no charity can be accountable to a third party - currently, NDPBs are accountable to ministers. The loss of charitable status could devastate fundraising. Museums would no longer be able to apply to trusts and funds that are constitutionally bound to donate money to charities.
NMS estimated it would lose £1.5m a year from revenue income if it lost charitable status, as well as millions of pounds of public sector support for capital projects. It also estimated that about £50,000 would be lost in Gift Aid.
In written evidence to the Communities Committee, NMS said: 'Removing charitable status from the national collections institutions will not serve the public benefit.
It will mean that either these institutions lose millions of pounds in charitable giving and tax relief, resulting in a poorer service to the public, or they are replaced by independent but far less accountable organisations.'
Independent fundraising experts Brakeley Ltd concluded in a report commissioned by NLS on the impact of the bill, that 'the effect will be to render private fundraising for these important Scottish institutions impossible, leading to a greater dependence on the public purse and ultimately a severe curtailment of their activities'.
Joanne Orr, the director of the Scottish Museums Council, told Museums Journal that, while independent museums welcomed the clarity the regulations would bring, the council did not want to see the nationals undermined and charitable giving or tax relief affected.
The national collections are also concerned that if they are forced to became independent charities, they would lose the government indemnity that insures collections against loss or damage.
The legislation could also put the national collections of Scotland at a competitive disadvantage with their English and Welsh counterparts, which would still be able to access charitable funds and trusts.
The national collections are lobbying the Scottish Executive to allow them to remain NDPBs with special charitable status before the bill becomes law in April 2006. The final debate is scheduled for later this year.
The bill is designed to modernise charity law in Scotland and ensure that charities are properly regulated, independent organisations.
All non-department public bodies (NDPBs), including the National Museums of Scotland (NMS), National Library of Scotland (NLS), and National Galleries of Scotland (NGS), will be affected by the rules set out in the Charities and Trustees Investment (Scotland) bill.
These state that no charity can be accountable to a third party - currently, NDPBs are accountable to ministers. The loss of charitable status could devastate fundraising. Museums would no longer be able to apply to trusts and funds that are constitutionally bound to donate money to charities.
NMS estimated it would lose £1.5m a year from revenue income if it lost charitable status, as well as millions of pounds of public sector support for capital projects. It also estimated that about £50,000 would be lost in Gift Aid.
In written evidence to the Communities Committee, NMS said: 'Removing charitable status from the national collections institutions will not serve the public benefit.
It will mean that either these institutions lose millions of pounds in charitable giving and tax relief, resulting in a poorer service to the public, or they are replaced by independent but far less accountable organisations.'
Independent fundraising experts Brakeley Ltd concluded in a report commissioned by NLS on the impact of the bill, that 'the effect will be to render private fundraising for these important Scottish institutions impossible, leading to a greater dependence on the public purse and ultimately a severe curtailment of their activities'.
Joanne Orr, the director of the Scottish Museums Council, told Museums Journal that, while independent museums welcomed the clarity the regulations would bring, the council did not want to see the nationals undermined and charitable giving or tax relief affected.
The national collections are also concerned that if they are forced to became independent charities, they would lose the government indemnity that insures collections against loss or damage.
The legislation could also put the national collections of Scotland at a competitive disadvantage with their English and Welsh counterparts, which would still be able to access charitable funds and trusts.
The national collections are lobbying the Scottish Executive to allow them to remain NDPBs with special charitable status before the bill becomes law in April 2006. The final debate is scheduled for later this year.
