Giving back to communities of residence and of origin. Cathy Pharoah and Tom McKenzie

Giving back to communities of residence and of origin • Cathy Pharoah and Tom McKenzie • 10 May 2013

Some data perspectives


o ONS/DEFRA Living Costs and Food Survey, 2001 to 2010 annual cross-sections

o 63,033 households in the United Kingdom (~6,000 per year)

o Two-week spending diaries including remittances and charitable donations

o Household characteristics (composition, age, education, employment, budget)

o 2001 Census classification of ethnicity

UK household survey evidence


Ethnic minorities in the survey sample


Households at risk of poverty, by ethnicity


Comparing remittances and donations


Proportions of total spending, by ethnicity


Modelling remitting


Modelling remitting HRP characteristics Ethnicity Age Employment status Education Household characteristics Composition General spending/ wellbeing “Indulgence” spending Other giving Region Time period (quarter, year)


Modelling donating


Modelling donating

HRP characteristics Ethnicity Age Employment status Education Household characteristics Composition General spending/ wellbeing “Indulgence” spending Other giving Region Time period (quarter, year)


Modelling remitting and donating


Pr(remitter=1) Pr(donor=1) 1 3

4.6% 28.8%

dy/dx std. err. p dy/dx std. err. p

HRP

eth

nic

grou

p

mixed 6.0% 0.018 0.001 -4.8% 0.024 0.041

Asian/Asian Br. 15.3% 0.012 0.000 -7.8% 0.012 0.000

Black/Black Br. 21.0% 0.015 0.000 -7.2% 0.014 0.000

Chinese 12.8% 0.032 0.000 -6.8% 0.033 0.038

other 12.6% 0.022 0.000 -11.0% 0.020 0.000

further controls no no

residual correl. ρ 0.208

Correlation between remitting & donating


Pr(remitter=1) Pr(donor=1) 2 4

3.7% 26.4%

dy/dx std. err. p dy/dx std. err. p

HRP

eth

nic

grou

p

mixed 7.2% 0.021 0.000 4.1% 0.029 0.151

Asian/Asian Br. 14.3% 0.012 0.000 -3.9% 0.013 0.003

Black/Black Br. 22.0% 0.017 0.000 1.2% 0.018 0.527

Chinese 11.2% 0.030 0.000 -1.8% 0.039 0.647

other 12.3% 0.022 0.000 -5.6% 0.024 0.017

further controls yes yes

residual correl. ρ 0.121




?


o Interviewers: Tamara Tatem-Hale and Nikki Lee

o 32 remitters in London, aged between 24 and 71

o 17 female, 15 male

o China, Somalia, Bangladesh*, Bolivia, Pakistan, Poland

o 12 with children in country of origin; 12 with children in the UK (some overlap)

o range of educational qualifications and occupations

o migration to the UK: some ‘forced’, others ‘voluntary’

o remitting between £10 and £1,000 per month

*3 Bangladeshi interviewees were born in the UK

Interviews with remitters in London


Giving back: motivation and approach




















Parallels and differences?

o Immediacy in perception of need

o Religion

o Status (‘conspicuous’ remitting and donating)

o Responding to the ask

o Level of obligation

o Decisions to remit and to donate can both be individual or collective

o Division of responsibilities in the remittance distribution process

o Remitted money goes directly to remote recipients


Implications of the findings

Main areas:

o valuing the generosity of the UK’s migrants and minorities

o understanding the place of remitting in diaspora philanthropy and sharing models of giving

o access to charitable tax benefits

o support for migrants who remit

o re-evaluating our approach to concepts and measurement of giving


Valuing migrant and minority giving

Precedents for wider understandings and meanings of giving exist

o Giving historically measured in UK only by money to formal registered charities

o Volunteering similar, but informal help incorporated (Citizenship Survey)

o No real parallel to this in the study of giving of money

o Yet there are multiple traditions of making charitable gifts in the UK:

o giving to people asking for money on the street (ambiguous attitudes);

o gifts in kind (not individual)

o donations to charity shops, food, clothes appeals (donate a coat/ suit);

o direct web appeals, disintermediation: Karen, bullied bus monitor ($700k)


More diverse understandings

o Acknowledgement that giving and sharing within extended family and community networks is an important part of giving cultures

o ‘Giving within extended families represents an interesting challenge to existing literature on philanthropy [. . .] it is part of the responsibility of belonging to an extended family, group or community’ (Everatt et al 2005, South Africa)

o Taking responsibility for those in need close to oneself underlies aspirations for greater mutual responsibility and empowered communities, or Big Society.

o ‘Mutual support is at the core of a happy, healthy society’ (WP Cabinet Office, ’11)

o Emerging study of inter-relationships between different giving behaviours


Celebrating and learning from diversity

o The Giving White Paper emphasises the importance of teaching young people about the culture of giving - future curriculum development around giving and citizenship could valuably include examples and knowledge-sharing from the cultures of giving in UK’s diverse communities

o US work has suggested that the experiences of giving which young migrants learn from family backgrounds could be rich source in teaching other young people about giving.

o Government should include specific support for initiatives that celebrate and promote different traditions of giving within its giving policy, White Papers and action programmes like Innovation in Giving


Messages for policy

Main areas and agencies

o Remitter behaviour

o International NGO services for donors

o Fiscal policy development

o Role of money transfer organisations (MTO)

o Role of migrant infrastructure agencies


Adapting ways of remitting

o Promote awareness-raising and education around tax-effective giving

o The other side of the coin is that remitters are prepared to switch some remitting to approaches which enable use of tax-effective vehicles for their giving

o For example, making more and better use of the collective ways of fundraising or giving for which there are already many precedents amongst remitters such as:

o Formalising the informal collection mechanisms in which many participate into giving structures eligible for a tax break

o A proportion of remittances could be diverted into collective funds for projects of community benefit, which would be eligible for a tax break (see AFFORD)


Development of INGO services for donors

o The easiest route to tax benefit is giving through an INGO: could donor services be more responsive to elements embodied in remitting? Models and precedents already exist

o Plan International’s ‘sponsor a child’ scheme allows donors to provide direct support to, and interact with a specific child, and monitor development over time

o Plan International offers donors the opportunity to support specific local projects, including education, homelessness, business training, and small-scale local enterprise (through microfinance)

o Hope Africa targets help to poor families enabling donors to choose the family they would like to help and how they would like to help, and facilitating relationships between donor and recipient


Development of INGO services for donors

o Global Giving list specific international named projects/organisations to which donors can give

o US Kiva enables social investors to lend to identified individuals / businesses through established community micro-finance institutions

o The Cash Learning Partnership (CaLP) are providing immediate targeted cash help in humanitarian and disaster situations, including where migrants are trying to help their extended families, communities

o NGOs provide vouchers for specific gifts such as food, education and health – like ring-fencing remittances through accounts with local food stores, banks or RemitPlus for school/ health fees, invest in an enterprise


Access to fiscal benefits

o Anomaly in much donor support and incentive for addressing the poverty of strangers in developing countries, and for bridging the gap between donor and recipient in substantive and tangible ways while discounting help for those already near and dear

o Similarities between UK charitable giving and migrant remitting, dissimilarities in access to fiscal benefits: INGOs claim Gift Aid (DFID 2010), while remitting is only occasionally tax-efficient

o Barry and Øverland (2010) argue on moral grounds that remitters deserve favourable tax treatment because they fill gaps in governments’ overseas aid, and suffer particular personal and economic cost


Access to fiscal benefits

o Chavez (2006) argues on legal grounds that money collected by Mexican migrant organisations from members for the benefit of specific communities, fulfils all the criteria for a US charitable tax deduction:

‘the fact that personal remittances and collective remittances are focused on improving the welfare of others suggests that both should be eligible for the charitable deduction ...

Collective remittances lead to investment in infrastructure, education, and health facilities in migrants’ home countries [... meeting] basic needs [...] for the communities in which these families live’


Multi-agency approaches necessary

o Money transfer organisations (MTO)

o Infrastructure agencies and MTO could provide information on tax breaks for giving, and develop some communal funds, endorsing details of employment where appropriate

o Those serving particular countries, regions or communities could help the development of collective funds to which their clients could contribute, claiming subsidies and helping to organise the distribution of such funds

o MTO who participate in such initiatives might get a market advantage, but there might also be a role for corporate incentives, such as tax breaks for corporate contributions


Multi-agency approaches necessary

o For example, Dahabshiil, largest Somali MTO, has corporate policy of investing 5% of profits into community projects in education and health, relief efforts around Horn of Africa

o Alongside remitter services, it provides money transfer and services for processing donations /grants from humanitarian and international development organizations including United Nations, Save the Children, Oxfam, Care International


Third sector, other and statutory agencies

Infrastructure agencies

o Agencies serving migrant and minority communities could be supported, possibly through dedicated grants, to advise remitters but also to provide or facilitate access to giving vehicles such as donor-advised, collective giving and investment funds

Supporting those who give through remitting

o Central/local government should provide advice/ guidance to officers assessing needs in health, welfare, housing, employment and legal support on taking into full account the financial responsibilities and obligations of migrants and minorities

Documents

Giving back to communities of residence and of origin. Cathy Pharoah and Tom McKenzie