Context
The Lichfield and Hatherton Canals Restoration Trust (The Trust) exists to restore, rebuild and reconnect the canals to the national network, thereby creating a green and blue corridor for the benefit of our local and wider community and making them available for navigation.
Purpose
This document sets out how we will:
- manage our finances generally,
- raise the necessary funds to pay for construction and maintenance works,
- invest and safeguard those funds and
- spend on the various projects, programmes and necessary support activity to deliver the completed canals.
The availability and timing of finance is both the key enabler and limiting factor determining how quickly and when we will be able to start and complete projects and ultimately deliver our overall aim.
The path towards completion of the Lichfield and Hatherton Canals inevitably involves the completion of a number of sub-projects. Many of these, for example the larger civil engineering type developments, require very significant levels of funding. The most recent example of these is the Darnford Moors Ecology Park project. Other projects require much less significant funding levels (Planting, towpath development, ongoing maintenance etc).
Regular funding sources:
Current regular sources of funding provide general day to day funding and cash flow to support the Trust’s activities and are as follows:
- Membership subscriptions – these were last reviewed and increased in June 2023 and will be reviewed by the Board (but not necessarily increased) every two years.
- Donations – from members, supporters and businesses, some of which are regular, others spontaneous and/or in response to occasional campaigns on social media.
- Sales of merchandise via the website and at events that are run by the Trust and other associated bodies throughout the year.
- Contributions via shopping websites such as EasyFundraising.
- The annual Grand Prize Draw.
- Sales of donated items – including good quality pre-loved items, equipment which isn’t robust enough for our heavy use and higher value items for auction or sale on websites such as Vinted, eBay etc.
We also receive welcome donations of time (from our regular adult volunteers, Duke of Edinburgh and school and college students and corporate teams), materials (bricks, cement, sand, gravel etc) and equipment (mowers, dumpers, strimmers etc). Whilst not funding, per se, we also receive VAT refunds.
All of these sources continue to be significant contributors to the day to day running of the Trust including ongoing maintenance. The Trust will continue to nurture and, wherever possible develop these sources, monitoring press and other information sources with a view to identifying additional potential funding sources to better support ongoing activity.
More significant funding sources
Our vision requires the restoration and building of canal channels, towpaths, locks and associated works, all requiring more significant funding than can be achieved from the regular sources listed above. Therefore the following are critically important to secure:
- Grants – for construction, maintenance, trees and plants, green and grounds work and for equipment,
- Fundraising campaigns – such as the Big Give which we’ve successful used to fund new signage and a major contribution towards a pedestrian lift bridge.
- Specific campaigns – often via social media for specific items of plant or equipment
- Sponsorship – where, in return for a major financial donation (or possibly a significant donation of construction materials or large vehicle etc) an individual or business has a piece of infrastructure such as a lock or bridge or woodland named after them.
- Legacies – a number of supporters have kindly remembered us in their wills and we have advertised in our publications and on our website how people can do this.
With the exception of annual events (such as the Big Give) all others are difficult to plan for with certainty but are essential for the success of the Trust.
Irregular sub-project funding sources:
The more financially significant civil engineering and construction activity that the Trust needs to undertake can only realistically be achieved by organising the whole project into a series of sub-projects, effectively bite sized chunks, for which there is realistic possibility of gaining funding, and which can be effectively managed within the Trust’s own resources – even where contractor activity is involved. The finance team has a significant part to play in this, in particular:
- Monitoring and identifying potential funding sources, and presenting them to the Board for approval/prioritisation,
- Matching funding bid criteria to LHCRT sub-project characteristics,
- Marshalling other LHCRT resources (engineering, procurement, technical, planning) to develop credible and viable funding bids for projects that match the provider’s selection criteria,
- Preparing and submitting bid documentation, and monitoring subsequent progress through the approvals process, responding to requests for additional information along the way,
- Ensuring that, from the outset of a successful funding bid, the Trust has sufficient funds to support activity where re-imbursement from funders is in arrears (the usual case),
- Ensuring that project milestones are met, and that associated funds requests are promptly and efficiently managed, and
- Ensuring that any project termination and wrap up information is provided to funders.
General accounting
All of the financial activities of the Trust should be properly recorded and accounted for and capable of independent verification.
The accounts should:
- be kept in respect of the Parent and its subsidiaries as required by section 386 of the Companies Act,
- accord with the accounting records,
- comply with section 396 of the Companies Act,
- represent a True and Fair View of the financial activities of the Trust,
- be prepared in accordance with the methods and principles of the Statement of Recommended Practice for Accounting and reporting by Charities [applicable to charities preparing their accounts in accordance with the Financial Reporting Standard applicable in the UK and Republic of Ireland (FRS102)]
The Finance team should ensure that:
- any surplus funds are placed in appropriately secure investments to maximise income.
- we have sufficient readily available cashflow to support both day-to-day spending and large sub-projects, for which grant money can only be claimed once money has been spent and invoices received,
- Statutory returns are prepared and submitted on time and to standard (eg: HMRC and VAT),
Current focus
In support of the delivery of our current Operational Plan, the Finance & Funding team is focussing on:
- Applying for and securing large scale grants for construction.
- Promoting the Trust as an option for legacies
- Large scale sponsorship opportunities.
July 2023