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
HRPethnicgroup
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
HRPethnicgroup
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

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

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