uhh.. so.. charities can do what Durai did but legally now?
Removal of 80:20 spending rule expected to help charity sector growSINGAPORE : 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)