What can we afford to grant?

This is arguably one of the most important pieces to plan and agree. You must remember that first and foremost you are a trustee of the District or County, and are under a legal duty to act in the District’s or County’s best interest. This guidance can’t take into account every possible scenario, but you need to consider your regular income, expenditure, and funds at hand, and work out what you can afford to give while not jeopardising the financial health of the District.

If you have a healthy balance of funds in the bank, a comfortable income and regular expenditure which is met by your income each year, you can probably afford to give a little more, but if you have a reasonable balance of funds, your only income is through the membership fee and you know you have significant expenditure coming up you might be a little more cautious. The District or County Executive as charity Trustees must consider this carefully.

If you do have large reserves, it is worth considering why that is. Are you charging the right membership fee if that money is just building up and sitting in a bank account? What would a reasonable reduction look like? Now is a great opportunity to have a fundamental rethink about what the right level of reserve should be, then work out what to do with the rest. The Charity Commission provides a helpful guide on reserves.

One thing to consider is whether this might be a short period of one-off grants, or whether the District or County could afford to set up a more long-term grants programme. Again, the Trustees will need to consider what they can afford and what’s most appropriate. Also consider whether to have a separate small and large grants model. It will be up to the Trustees to decide what small and large actually means, but you must give Groups clarity on what size of grants are likely to be available and for how long so that they can apply in the right way.

This all comes back down to understanding what is going on locally. If you are in regular contact with the Groups in the District, you should by now have an idea for the scale of financial support they might need and what would work best for them.