Categories

AOAV: all our reportsMilitarism examined

Questions raised as research finds UK armed forces charities sitting on reserves of £275 million

The UK’s ten largest military charities hold assets of £1.4bn and reserves of £275m, leading to concerns that some may be “hoarding” cash. According to an analysis by Action on Armed Violence and shared with The Times, the country’s 1,500 armed forces charities are worth more than £3.1bn in total. Questions have been raised over the amount of unrestricted reserves that some of the biggest charities have built up, with several saying that they wish to reduce these amounts.

Such reserves comprise cash that is not designated for a specific purpose or restricted in how it can be used under the terms in which it was donated. The Royal British Legion, the wealthiest military charity, began its annual poppy appeal last week. Last year, it recorded a total income of £163.2m and expenditure from unrestricted funds of £136.7m. Its reserves totalled £70m, equivalent to around 40% of its annual income and enough to fund its operations for six months. The charity stated in its annual report that this was £30m above its target of £40m reserves and that it was looking to reduce it.

Others with significant reserves include the Royal Air Force Benevolent Fund, the fifth largest British military charity, which had an income of £22.5m last year and expenditure of £25.6m. At the end of the year, it had £37.4m in unrestricted reserves – equivalent to 165% of its income.

ABF The Soldiers’ Charity, the eighth largest military charity, recorded income of £17.7m and expenditure of £22.9m last year. It had £19.5m in unrestricted reserves – equivalent to 110% of its income.

It is five years this week since Britain last had regular troops deployed on the ground overseas in a combat mission, which was the end of Operation Herrick in Afghanistan. During this period, the total assets of the top ten military charities have increased by 27%.

The Charity Commission is not prescriptive about the best ratio of reserves to income, but it warns that a charity thought to have big reserves may provoke resentment if it seeks more funds. Concerns have been raised that recent donations to military charities, boosted by the anniversaries of both world wars, have increased at a time when the number of veterans is declining due to old age.

The vast majority of military charities provide important help for military personnel and veterans and often their families. This can include assistance to those who have suffered physical and mental trauma on the battlefield, initiatives to help veterans into housing, and providing elderly care and dementia nursing. Reserves are designed to help charities to survive instability and to ensure that the public are reassured about their future when thinking about donating. Some charities include property in their reserves.

The creation of the Office for Veterans’ Affairs means that some of this work may soon be done by the state. There were 2.5 million veterans in Britain in 2016, of whom half are thought to be above 75, according to a Ministry of Defence report released earlier this year. The number of former personnel is expected to fall to 1.6 million by 2028.

The Royal British Legion told The Times that its reserves were in line with most charities of its size. Meanwhile, the RAF Benevolent Fund commented to The Times that: “Our board of trustees has agreed a minimum of £30m in free reserves is required to ensure we [can] look after those members of the RAF Family we support, whatever happens to the fund.”