Buffett donates $37bn to charity

Warren Buffett says he was "wired at birth to allocate capital"

Billionaire investor Warren Buffett has said he was waiting for decades to make a huge charitable donation.

He said he was overjoyed as he spoke for the first time since revealing he would donate about $37bn (£20bn) to Bill Gates' charitable foundation.

"This has been coming for 50 years," Mr Buffett said. "There's never really been any other plan in terms of where the money should go."

The donation is thought to be the largest charitable gift ever in the US.

Giving people a chance

Mr Buffett will hand 10 million shares in his Berkshire Hathaway firm to the Bill and Melinda Gates Foundation.

HAVE YOUR SAY As long as my family and I have sufficient I would give away all the excess Robert Askew, UK Send us your comments

News of the donation comes shortly after Mr Gates announced he is to step away from his day-to-day role at software giant Microsoft.

The man known as "the sage of Omaha" for his relentless success in investments said he always wanted to give the bulk of his fortune away.

However, he said the appropriate vehicle for doing so do had only become apparent in the past year.

"I am not an enthusiast of dynastic wealth, particularly when the alternative is six billion people having that much poorer hands in life than we have, having a chance to benefit from the money," he said.

Mr Gates said it was Mr Buffett's support for philanthropy which had persuaded him to set up the foundation in the first place.

Bill and Melinda Gates Foundation Fund of $29.1bn $10.5bn in grants since 1994 Aims: reducing poverty and improving health and access to education Largest grant: $1bn to the United Negro College Fund 70% of aid spent outside US The billionaire philanthropist

"It is a big challenge to make sure this money gets used in the right way," he said of the donation.

"But it is one we are thrilled about."

The foundation aims to fight disease and promote education around the world, particularly in developing countries.

"There is no reason why we can't cure the top 20 diseases," Mr Gates - who will give up his day-to-day role at Microsoft in 2008 to concentrate on the foundation's work - said.

BBC business editor Robert Peston said the size of the foundation's cash pile dwarfed that of other organisations, and compared it with the $12bn annual budget of the United Nations.

He added that the foundation was "an extraordinary new force in the voluntary sector".

New will

Mr Buffett is worth an estimated $44bn, according to Forbes magazine.

As well as donating to the Gates foundation, he also pledged shares for his three children and a substantial gift for a foundation named for his late wife, Susan Thompson Buffett.

All the gifts will be awarded yearly, with 5% of each donation passed on each year, it was announced.

He confirmed his decision in letters to the recipients, and said he would write a new will to ensure the money continues to be distributed after his death.

In making his award, Mr Buffett - who plays bridge with Mr Gates - said he chose to distribute his wealth to an existing foundation out of respect for its current work.

One of the terms of the donation is that at least one of Bill or Melinda Gates continues to be involved with the foundation.

The foundation has evolved into one of the leading philanthropical organisations in the world, listing as one of its primary goals "reducing the 'unconscionable disparity' that exists between the way that we live and the way that the people of the developing world live".

Simple life

Stacy Palmer, editor of the Chronicle of Philanthropy, said that Mr Buffett's donation was the largest made by one person in the US.

TOP FIVE BILLIONAIRES Bill Gates (US, Microsoft) - $50bn Warren Buffett (US, investor) - $42bn Carlos Slim (Mexico, industrialist) - $30bn Ingvar Kamprad (Sweden, Ikea) - $28bn Lakshmi Mittal (UK, steel) $23.5bn Meeting Warren Buffett

She explained that Mr Buffett's largesse eclipses the charitable donations of such well-known givers as John D Rockefeller and Andrew Carnegie.

Despite his huge wealth, Mr Buffett has modest tastes, is called a "cola and hamburger kind of guy", plays the ukulele, and still lives in the same house he bought in his home town of Omaha, Nebraska, in 1957.

Mr Buffett has stated that the death of his wife Susan was one of the reasons behind his donation to the Gates Foundation, because he had thought she would outlive him and handle the dispersal of his wealth.