Britain has a real opportunity to increase income to universities through charitable giving. Such fundraising is a legitimate activity and there is evidence that the UK population will give to universities. It is now up to higher education sector to invest in fundraising and make it more professional, and for the government to review taxation policy to increase the potential for donations, particularly from older people.
Those are the general conclusions of the task force on charitable giving that I chair. In our report, to be published today [13 May 2004], we use the success of donations to universities in the US for comparison. Some would argue that that is inappropriate. I disagree. Universities in the US have very similar ambitions, history and values to their British counterparts. The American tradition of philanthropy was born in Britain. Both countries are wealthy and current demographic changes, which increase the potential for giving, are the same in both countries.
The scale is, of course, very different. Pennsylvania State University raised $1.4bn (£800m) over seven years in its last campaign. We should not be intimidated by that. Many US universities had no real fundraising activities even 20 years ago and now are very successful at it.
Universities are charities and it is part of the duty of a charity to solicit help to fulfil its ambitions. There is nothing inappropriate about this and universities should not shy away from asking for support. What we do is honourable and for the public good. There is evidence from both the UK and US that there are many individuals, particularly alumni, who are keen to support us in furthering those ends.
Nevertheless, some commentators are anxious that we are already going to ask students to contribute more to their education and that this will make them less ready to give to universities when they are older. The evidence from the US, however, is that such contributions reinforce students' loyalty to the institution and create a platform for higher rather than lower donations. In addition, most giving occurs in later life - usually long after loans have been repaid and the benefits of having experienced a higher education are evident to the donor.
Another concern is that a high level of donations distorts a university's ambition or distracts academics from their core task. The task force could not find any evidence of this. Indeed, the opposite is true. Donors are unwilling to give unless they are convinced that their donations will assist the institution in reaching its idealistic ambitions. Furthermore, donors will not give if they believe their money is replacing state support, so it is essential that substantial public investment continues alongside charitable giving. Importantly, philanthropic giving does not support the core activities of the university. Almost invariably it adds value and increases excellence that is based on adequate public support.
Demographic changes will increase the potential extent of philanthropy. We have the wealthiest generation of over-50s ever and they have the lowest number of children on whom to visit that wealth. The wealthy are clearly in a position to give the most, and we believe that they will not necessarily give everything to their children: they will consider other beneficiaries, including universities.
But so far, most UK universities have not approached the solicitation of donations in the professional and systematic manner common in the US. Those that have embarked on dedicated, professional fundraising have seen substantial returns. Oxford and Cambridge are often cited as the best examples, but Bristol and Aberdeen have also realised substantial sums through concerted campaigns. We believe that such returns can be achieved by the whole sector, including new universities.
Finally, when it comes to tax policy, Gordon Brown, the chancellor, has created one of the most generous environments for giving. But it can appear complex to individual donors. In the US, a number of tax vehicles are aimed at enabling donations in later life. We believe the government should explore changing in the UK tax position to make it simpler to give to universities, particularly as donors grow older.
There is nothing in life more exciting or inspiring than to be put in charge of your own destiny. Increased charitable donations to universities will give them more autonomy and, as one very successful fundraising office for a US state university puts it, "provide the people...with a better university than they could otherwise afford". Britain's universities should seize this possibility with both hands.
Professor Thomas chaired the Task Force on Voluntary Giving to Higher Education. Its report to the government was published on 13 May 2004.