uhh.. so.. charities can do what Durai did but legally
now?
Removal of 80:20
spending rule expected to help charity sector
grow
SINGAPORE : Charities welcome the removal of the 80:20 spending
rule announced in Thursday's Budget statement.
The move will not only allow charities to better plan big projects
over the long term, it will also encourage more grant makers to
surface, and fund meaningful charitable programmes.
It is an annual scramble during the year-end for charities and
foundations as they have to spend 80 percent of donations collected
on social programmes; in order to qualify for tax exemption.
Gerard Ee, Former President of National Council of Social Service,
Retired Accountant, "In the case for foundations, with the 80
percent rule, there's a scramble towards the year-end to do your
calculations to see whether you've complied with the 80 percent and
then you dish out the money according to all the applications you
received, and you don't really worry too much about whether the
projects are worthwhile supporting or not because you have to meet
your 80 percent."
The 80:20 spending rule also ties the hands of charities who may
want to accumulate more money to run bigger, more meaningful social
projects.
But as the rule dictates that charities have to use up 80 percent
of the donations by the following year, they are trapped in a cycle
of constant fundraising.
So the general reaction to the change is positive with charities
believing it will help Singapore grow into a philanthropy hub,
attracting even foreign foundations.
Gerard Ee added, "I'd really wish the Gates Foundation would set up
an office in Singapore. They're interested in giving grants for
research. We're doing a lot of research here, medical research here
in Singapore. Maybe we can benefit from some grants from the Gates
Foundation that may decide to set up an office in Singapore."
On the flip side, with the removal of the 80:20 spending rule,
grant makers will now have more time to scrutinise charities'
applications for funding.
So charities will have to come up with better programmes, and more
persuasive proposals to get funding support from the
foundations.
The change is expected to also encourage charities to become more
professional in their management and practices.
All of which means more effective help for the needy.
(source: Yahoo News)