Small Charity Index Trends

Summary

coverIt seems to that whichever way we look we, small charities are taking it on the chin, rolling with the punches and desperately holding on. We are coming up with our own solutions, making impossible decisions and getting on with the job of supporting the people and causes we were set up to serve. This doesn’t mean that the government couldn’t do more and we know it is thinking about how to build sustainability into the sector.

Over the coming years small charities must take advantage of all support on offer to help build more sustainable organisations. Government can make a difference, the support packages they offer and the policies they make will enable sustainability. But if we have learned anything since 2008 it’s that we have to be in charge, take control of our own future and set our own course of action.

By far the most startling trend has to be around the demand for services which has risen over the period by 64%. Small charities, who can rely heavily on statutory funding, often work with the most disadvantaged or marginalised of groups. This is primarily because they work in and are trusted by local communities and therefore more able to reach those in most need. The services they provide to vulnerable communities goes beyond what is statutorily mandated, often developing innovative solutions to the problems they seek to solve.

With a steady rise in small charities indicating likelihood of closure, sustainability is a growing issue. If governments fail to recognise the real value of the services delivered by small charities, if they continue the momentum to engage with larger private business to deliver wide scale contracts, they will fail to invest sufficiently in the small charity sector. Given that grassroots charities are often at the cutting edge of developing the most creative and innovative solutions to some of the very complex problems facing society today, the lack of investment could impact significantly on the UK’s ability to meet the future needs of an increasing complex set of societal problems.

The tradition of volunteering in the UK is strong and we welcome the Government’s initiative to increase volunteering across the small charity sector. Volunteer numbers, at least in smaller charities, has increased steadily over the past three years, showing a 25% increase overall. This seems to go against a recently published 2015/16 Community Life Survey which indicate volunteering levels remaining stable.

A further area of concern coming out of the data is the consistent reporting of workload as a significant issue. In each quarterly Small Charity Index, workload is reported as the greatest concern to small charity leaders. This is understandable when coupled with increased demand for services and a relatively small movement in staff resources. Birdsong Charity Consulting, who 1 2 conduct an annual ‘Pulse of the Sector’ survey, reported 49% of respondents indicated that they experienced stress at work related to workload. Reduction in workload was frequently mentioned as one of the things respondents to the survey would like to change about their workplace.

Underlying all of the above is a need to increase income into small charities across the UK. The trends over the past three years see statutory income dropping by 8%, voluntary income increasing by 2% and earned income increasing by 9%. In reality income to small charities remains static, which might account for an increasing number of charities, between 27% and 48% (over the three year period), using reserves. This is a problem when only three quarters of the small charity sector report to holding reserves.

Over the last three years we have consistently called for more small charities to work in meaningful partnerships; to deliver over 30% of their services in partnership with others. Both the Small Charity Index and other research shows that small charities are failing to work more collaboratively, which was offered as a potential solution when the 18 month trend analysis (Small Charity Index: Trends, Shifting Sands in the Small Charity Sector) was published in late 2014.

Download the full report: Finding a way, no matter the cost

 

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Small Charity Index Trends: Shifting Sands in the Small Charity Sector