Charity is a fine thing, but it can't justify the wealth of the 1% - Polly Toynbee

The rich pretend the option is the status quo or outright communism. But giving is no excuse for gross inequality

Charity is a fine thing, the backbone of a good society. But too often it's used to justify the 1%'s mushrooming wealth. Pointing to the fine monuments to Victorian philanthropists, the rich imagine a better era before the intrusive state stepped in: if only taxes were lower, they would give as their ancestors did. But they conveniently ignore the facts.

Figures from the Charities Aid Foundation (pdf) show £9.3bn donated in 2012 – a goodly sum, but a flea bite beside the state's £700bn spending. If good works replaced social security and public services, we'd be back with Victorian destitution. The better-off give most cash because they have the most – but they make a far smaller sacrifice. Surveys always show the poorest 20% give considerably more of their incomes – 3.2% – while the richest 20% donate a meagre 0.9%. That is remarkable when you consider how much harder it is for those living near the poverty line to give anything, while the top 1% takes an enormous 14% of national incomes. Those closest to needing help seem the most understanding about the difference small sums make to those on the edge. After the crash, the professional classes dropped their giving by more than those who earn less. But in the world charts, Britain does well, as sixth largest giver (pdf).

What's best about charity is also what's worst about it: it is paid out by the whim of the giver and among the rich often with strings attached. Women give more than men, the older more than the young. Charities that top the giving register are not purely altruistic, but causes that might one day benefit the giver – medical research, hospitals then hospices.

Only after them come children and young people. Religion draws most cash – and you wonder why that's a charitable cause at all. Unpopular causes struggle. As an inefficient method of funding, just try computing the amount of time, effort and money that goes into each charity trying to squeeze small sums out of many, or beseeching the few to part with a lot – causes competing for the same pots from foundations or government grants.

What's best about charity is that it can power new ideas as a beacon to show how the state could run its social services better, or foreign aid, arts, sports or anything else. But as all charity leaders say, they are no substitute for state funding, as the right imagines. The idea of the "big society" was a good one, though once purloined by politicians it killed the very quality it pretended to promote. Cynicism flowed once charities found themselves cut to ribbons, used as a front for contracts that flowed instead to Serco, A4e and G4S.

Argue as you like about giving to beggars who may be addicts, they pluck at a primal conscience – there but for great good luck go any of us. When the Wall came down, a most chilling revelation about communist states was their lack of any civil society – no charities, no buffer zone, no voluntary spirit, all natural generosity deliberately atrophied. The impulse to give is hard-wired into most human hearts.

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