Written evidence from R K Baldwin BCom, FCA, CTA (OLL 01)


Objective of my evidence


My comments are principally aimed at the achievement of increased participation within grass roots sport and will also indicate how this can be measured in terms of the action I propose.


My credentials


I retired as a Tax Partner with Deloitte in July 2005 having spent over 25 years advising sport particularly in the voluntary non-profit sector on tax and related financial matters.


Since then I have spent most of my time advising sport in a voluntary capacity - I am Honorary Tax Adviser to the Central Council of Physical Recreation and a Trustee of the Rugby Football Foundation, a charity which supports grass roots rugby. I am also Chair of the CASC Development Forum which helps promote the financial welfare of community sports clubs by encouraging them to take advantage of the fiscal and other benefits from registering as either a charity or under the Community Amateur Sports Club scheme.


These comments are personal to me and are not made on behalf of CCPR, RFF or the CASC DF.


The critical role played by community sports clubs


Voluntary sports clubs will play a critical role in securing a legacy in terms of grass roots participation from the London 2012 Olympics. There is a grave danger that the success of the event itself will not provide that legacy because there is insufficient capacity within the voluntary sports club sector to accommodate a significant increase in participation. Sports clubs need adequate funding which is not easy in the current environment as a result of the diversion of Lottery funding to pay for the 2012 Olympics and the severest recession in living memory.


The finances of sports clubs


Up to date information on club finances is available form a recent survey commissioned by CCPR in its "Survey of Sports Clubs 2009" (Sports Industry Research Centre November 2009). 1975 clubs provided full details for questions on members, volunteers, income and expenditure for 2008 and 2007. The sample on which the Survey was based covered a broad spectrum of clubs both property and non property owning. Average profits per club were 1986 (1316 excluding golf) in 2008. This is a very small surplus in the context of running clubs which is not sufficient in my view to support a significant increase in participation.


The Survey also showed that membership numbers confirmed the importance of clubs in providing opportunities for participation by adults and juniors - average club size was 117 adults and 107 juniors. It also found that sports clubs were economically resilient but were sensitive to changes in the policies of organizations they work with and the legislative framework provided by Government. There is every likelihood that legislative and administrative burdens will increase in the run up to 2012 if the pattern of the last few years is repeated and with a poor economic environment club resources will be squeezed further.


Financing the Legacy through the CASC scheme


There is a solution to this issue of adequate club finances. For nearly 9 years the CASC scheme has been promoting good practice amongst local sports clubs. To be eligible to participate the club must:


be community focused and open to all without discrimination


have a core purpose in the promotion of amateur sport recognized by the Sports Councils


reinvest any income back in the club and transfer assets on winding up to charity, another CASC or to the sports governing body for community sport.


In return registered CASCs get 80% mandatory business rate relief, certain direct tax exemptions and qualify for gift aid repayments on any donations.


To date over 5500 clubs have registered under the scheme benefiting from a cash injection of around 65 mn. The CASC scheme therefore has the capacity to inject the necessary finance - if there were no further registrations the registered clubs will continue to benefit at the rate of 15 mn per year but increasing the number of registered clubs by 1,000 would increase the flow of cash by around 3 mn per year in total. The average club benefits by just under 3,000 each year and this would treble the surpluses by the average club within sports other than golf providing much needed finance to support an increased capacity for participation.


The introduction of the CASC scheme was not connected in any way with a bid for the Olympics but the latter represents an opportunity to exploit the scheme further. It must be said that the take up has been slower than sport would have wished. I have been involved with the development of the CASC concept since 1999 when an informal group was established to make proposals for tax relief for sports clubs. Following the introduction of legislation in 2002 this group was formalized as the CASC Development Forum whose members include HMRC, CCPR, DCMS, Sport England, Bates Wells and Braithwaite and myself as Chair. Whilst this has worked well and we have established a dedicated website www.cascinfo.co.uk to provide guidance to clubs there is insufficient resource to effectively promote the scheme. There has been no contact/liaison from those responsible for ensuring that there is a grass roots Olympic legacy of increased participation - indeed I am not even sure which organization has that responsibility.


How do we "marry" the CASC scheme and Olympic legacy?


Myself and CCPR are currently working with Sport England and Just Giving to encourage CASCs to seek more donations which qualify for gift aid. Whilst that will be very helpful in the short term it will not address the need for more clubs to hear about the scheme and register as CASCs to take immediate benefit from the cash which is available.


In my view what is needed is a specific initiative to promote the Olympic Legacy linked to CASC status and in which those responsible for that Legacy will actively participate. This would involve the provision of funding to develop and execute the CASC initiative which would be aimed at the increase of awareness of the CASC scheme and the provision of support to clubs wishing to register. The effectiveness of it could be measured - e.g. by setting targets for the number of club registrations and total cash benefits received. The initiative would include:


working with the Olympic "authority" responsible for "soft legacy" to exploit all CASC opportunities

working with National Governing Bodies of Sport particularly the Olympic sports to assist their clubs to register

Circulars / communication with sports clubs

Regional workshops working with County Sports Partnerships and Local Authorities

hotline support - by telephone or e mail

monitoring progress, feedback and easing administration in consultation with HMRC CASC Unit in Bootle.


December 2009