Overstating the risk of abuse from potential terrorists hurts public confidence in charities, according to the National Council for Voluntary Organisations (NCVO).

The organisation claimed that such occurrences of abuse from terrorists were "extremely rare".

The claim comes as the Home Office and Treasury release a consultation paper outlining the risk terrorists pose to charities.

Liz Atkins, director of public policy at NCVO said: "Instances of the terrorist abuse of charities are extremely rare and, when they occur, they are dealt with by the independent charity regulator, the Charity Commission."

"By placing a veil of suspicion over all charities, the government is in danger of damaging the trusted reputation of the voluntary sector and making people less likely to donate to good causes," she added.

NCVO, which is England’s umbrella body for charities, formed an advisory group which published a report critical of the government’s approach to the terrorist abuse of charities earlier in the year.

The report was entitled "Security and civil Society – the impact of counter terrorism measures on civil society organisations".