Chancellor Gordon Brown has outlined plans to encourage an extra £1bn of donations to charities and foster a new "civic patriotism" within the UK.

Under reforms of the tax relief system, the Treasury will top up contributions given by individuals by up to 50p to help boost donations.

The chancellor also said that he is aiming to simplify the guidelines for charitable donations from business, as well as making it easier for individuals to work within the voluntary sector.

Mr Brown told the BBC: "I believe people want to mark the new millennium by making Britain stronger as a community.

"I do believe this thirst for a new civic patriotism, which we're responding to today, is something that is very British indeed."

Mr Brown outlined the proposals in a speech at the annual conference of the National Council for Voluntary Organisations.

"I'm talking about three things, first of all making it easier for people to give both money and time to charity and voluntary work in their own communities," said Mr Brown.

"For every pound that an individual gives in future, after April the Treasury will make up another 28p and for every pound that people give to payroll giving, the Treasury will give up to 50p.

'Voluntary energy'

"And we've got new rules that will make it far easier for companies, who give only a fifth of what is given in the United States to charity and community activity, to do so as well. So we are changing the whole financial foundation to make it far easier to give money and time."

The government will also use the internet and a community television channel to put volunteers in touch with suitable projects.

"We have a wealth of community and voluntary energy in our country," said Mr Brown.

"The potential of Britain is the willingness of people to help each other and assist each other and I want to encourage a new civic patriotism in Britain."

Shadow Chancellor Michael Portillo said he welcomed efforts to help charities through the tax system, but said Mr Brown's announcment was "nothing but a reworking of commitments already made in the Pre-Budget Report".

Nick Kavanagh, chairman of the Charities Tax Reform Group, welcomed the announcement, but said that the chancellor should go one step further and scrap VAT on charity spending.

And Liberal Democrat economic spokesman Matthew Taylor said: "The chancellor's cuts to tax relief have significantly reduced the amount of capital available to charities from investment dividends."