Spending review implications for Catholic charities, dioceses and schools

Catholics in Fundraising has expressed both cautious optimism and concern following the release of the UK Government's 2025 Spending Review on Wednesday 11th June 2025. While the review outlines increased public spending and a notable 27% rise in the Charity Commission's budget, it notably offers no direct mention of continued or expanded support for listed places of worship or faith-based charitable initiatives.

The Spending Review sets departmental budgets to grow by 2.3% annually through 2028-29. However, despite this increase in government expenditure, there is a conspicuous absence of dedicated funding for religious heritage via the Listed Places of Worship Grant Scheme, which has historically helped churches reclaim VAT on repairs and maintenance.

"This omission is deeply concerning," said John Green, Chair of Catholics in Fundraising, "Catholic churches are not only places of worship but also vital community hubs. Without targeted support, many churches will struggle to maintain their buildings and services, especially in economically challenged areas."

The rise in the Charity Commission's budget-from £29.8 million to £37.9 million in 2026-27-has been welcomed as a step toward modernising oversight and supporting a growing and increasingly complex charitable landscape

However, this funding is primarily administrative and regulatory and not directly supportive of charities.

At the same time, rising inflation and increased taxation-implied by the government's broader fiscal strategy may reduce individuals' disposable income and their ability to give charitably. "We are concerned that while government spending is increasing, so too is the financial pressure on households," John Green added "This could lead to a decline in charitable giving at a time when demand for Catholic charities services is rising."

In addition to concerns about charitable giving, the Spending Review failed to mitigate the pressure facing independent schools, now subject to 20% VAT on tuition and boarding fees from April. This change is increasing operational costs for Catholic independent schools.

The Catholics in Fundraising conference on the 25th June will address this ever changing political and economic landscape and how Catholic charities, dioceses and schools can pivot to maintain their fundraising and mission. Tickets for the conference at Amigo Hall, St George's Cathedral are just £40 and can be booked at: www.ticketsource.co.uk/catholics-in-fundraising/t-vvnevqx

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Catholics in Fundraising is the UK's leading network for Catholics working in fundraising. It aims to build a strong community of like-minded individuals, offer insights into best practices, and encourage innovative approaches to fundraising within the Catholic context.

Twitter: @cathfundraising