Costs of public service delivery creep up

Finance | Ian Allsop | 23 Apr 2008

Charities are falling increasingly behind in achieving full cost recovery on public service delivery, according to new research from the Charity Finance Directors’ Group (CFDG).

The worst-performing quarter of respondents to CFDG and Agenda Consulting’s annual benchmarking study, Finance Count 2008, are making a loss of 8.8 per cent or more in their income on public service delivery activities, compared with a 3.3 per cent loss last year.

More encouragingly, a quarter made a surplus of at least 1.6 per cent of income. And the percentage of contracts that were fully-funded crept up, with an average of 71 per cent fully-funded this year compared to 67 per cent last year.

But only 44 per cent of respondents believed their budget-holders were fully aware of central costs, and the study recommended raising awareness of full cost issues across organisations.

Room for improvement on gift aid

Gift aid recovery levels appeared fairly low, with charities claiming an average of less than 60 per cent of the gift aid available to them.

The study suggested there was significant scope for increasing the amount of available income claimed, as some respondents reported recovery levels of almost 100 per cent.

“Increasing the percentage recovered will become ever more important for charities in the coming years if they wish to maintain current levels of gift aid income,” said CFDG.

Overall, the study concluded that “finance directors are clearly not complacent”. It identified internal reporting as by far the most common priority for future development, followed by financial planning and budgeting.

“Finance directors’ most frequently mentioned issues included efficiency and competitiveness, full cost recovery, staffing issues, and future income sources.”

Finance Count 2008 involved benchmarking the performance of 237 medium and large voluntary and community organisations from across the UK, representing almost 18 per cent of the voluntary sector workforce, and combined total net assets of over £5.2bn.

Who's Who: Ian Allsop

Comments

[Cancel] | Reply to:

Name *

Email *

Organisation

Job Title

Comments *

Verification *

* Please read our Community Standards

Close »

Community Standards

The civilsociety.co.uk community and comments board is intended as a platform for informed and civilised debate.

We hope to encourage a broad range of views, however, there are standards that we expect commentators to uphold. We reserve the right to delete or amend any comments that do not adhere to these standards.

We welcome:

Robust but respectful debate
Strongly held opinions
Intelligent relevant discussion
The sharing of relevant experiences
New participants

We will not publish:

Rude, threatening, offensive, obscene or abusive language, or links to such material
Links to commercial organisations or spam postings. The comments board is not an advertising platform
The posting of contact details for yourself or others
Comments intended for malicious purpose or mindless abuse
Comments purporting to be from another person or organisation under false pretences
Gratuitous criticism, commentary or self-promotion
Any material which breaches copyright or privacy laws, or could be considered libellous
The use of the comments board for the pursuit or extension of personal disputes

Be aware:

Views expressed on the comments board are left at users’ discretion and are in no way views held or supported by Civil Society Media
Comments left by others may not be accurate, do not rely on them as fact
You may be misunderstood - sarcasm and humour can easily be taken out of context, try to be clear

Please:

Enjoy the opportunity to express your opinion and respect the right of others to express theirs
Confine your remarks to issues rather than personalities

Together we can keep our community a polite, respectful and intelligent platform for discussion.