A country is usually said to be in a recession after two successive quarters of negative economic growth. The UK has officially been in the current recession since the second quarter of 2008, the longest recession since World War II. The Confederation of British Industry predicts that unemployment is forecast to rise to three million (9.4 per cent) in 2010.
A recession can affect charities in various ways; voluntary income drops as people have less disposable income to spend, funding from trusts and foundations reduces as their endowments lose some of their value, and those reliant on statutory funding can fall victim to public spending cuts. At the same time, some charities experience rising demand for their services, especially those in the advice and employment training sectors.
However, it must be emphasised that not all charities experience reduced income or increased demand – the sector is so diverse that different types of organisation tend to be affected in many different ways.
Most charities expect the near future to hold further drops in income, but anxiety over cashflow has lessened as the recession came to a close.
The charity sector is in a “phoney war” in terms of the true impact of the recession, according to a report from the Charity Commission on how trusts and foundations are responding to the economic downturn.
Half of UK charities say their income has not changed in the past year, while a further 30 per cent have experienced a drop of less than 10 per cent , according a new survey by accountants Baker Tilly.
Jenny Willott, Liberal Democrat spokeswoman for charities, will be tabling an Early Day Motion (EDM) calling on the government to reinstate the £750,000 campaigning fund that has been redirected from the Campaign Research Programme to the Hardship Fund.
The NCVO has launched a petition to persuade charities minister Angela Smith to reinstate the £750,000 funding that she has redirected from the Campaign Research Programme to the Hardship Fund.
NAVCA has accused the Office of the Third Sector of breaching the Compact in withdrawing £750,000 in funding from the Campaigning Research Programme, and urged charities minister Angela Smith to reverse the decision.
Four in five British charities expect income from voluntary donations to rise or remain steady over the coming year, according to new research. And their continental counterparts are even more optimistic. Figures from the latest annual State of the Non-profit Industry (SONI) report suggest that two-fifths of British charities expect donations to rise and another two-fifths predict they will stay the same.
An extra £100m has been allocated to frontline charitable activity by major philanthropists, according to this year’s Coutts Million Pound Donors report. Million-pound-plus donations have been largely resilient to the recession, according to the report. Some 189 donations of £1m or more were made in 2007/2008, just 6 per cent fewer than in the previous financial year.
The recession is over in the US. Done. Dusted. Glad that’s over. Phew. Even beleaguered old Blighty could emerge from the confines of recession by the end of the year, according to some economic soothsayers. Hooray. Let the charity sector delight in the new world order!
In an increasingly competitive marketplace, charities are well placed to negotiate better deals from agencies, says Alison Cowan It’s a tough market out there, and your first thoughts are probably not for the agencies that rely on corporate marketing budgets - usually the first spend to be cut in a recession.
Most people still want to keep giving, and not every charity is experiencing increased demand as a result of the recession. Beth Breeze writes as part of a series of four expert articles this month following the UK Giving report
Newspaper coverage of philanthropy and the recession between September last year and April this year contained eight pessimistic portrayals of a ‘vulnerable’ sector for every one article that depicted the sector as robust and resilient, a study shows. The inherent danger in this is that such stories can affect confidence in giving and create self-fulfilling prophecies of a giving recession, the researchers suggest.
The Elton John Foundation and the Irish Cancer Society are to provide grants to the Irish government to ensure it continues to deliver certain health and social care services in the recession. Ireland has been badly hit by the global economic crisis and its deficit is expected to widen from 6 per cent in 2008 to nearly 11 per cent in 2009 - the highest budget deficit in the European Union as a percentage of its GDP.
Donations to UK charities have plummeted by 11 per cent in the last year to £9.9bn, according to UK Giving 2009, the annual survey of giving habits carried out by Charities Aid Foundation and the NCVO. The drop, measuring £700,000 in absolute terms and £1.3bn in real terms, was calculated after polling 3,316 UK adults between June and October 2008 and in February 2009.
Half of the non-profit organisations around the world have reported a drop in income, a new survey of 126 fundraising directors and sector experts suggests. But fundraisers do not blame the recession for the fall, according to the study.
Charity shops increased their profits by 4.1 per cent in the past year, according to the Charity Shops Survey 2009 While the gross income of the 69 shop chains in the sample fell by 3.1 per cent to £526.1m, their costs fell even further, by 4.9 per cent to £414.6m, leaving a collective profit of £111.5m. Charity shops have now increased their profits for four years running, and in eight of the last 11.
Two out of five of the top fundraising charities saw their income fall in 2008, according to the latest figures. The combined income of the top 300 fundraising charities grew just 0.9 per cent in 2008 according to the annual Charity Market Monitor. The previous year income grew 1.7 per cent.
The Royal Horticultural Society could cut nearly 10 per cent of its workforce as it tries to make £1.7m in savings. Fears that traditional sources of income could dry up has prompted the gardening charity to propose that up to 100 jobs could go as part of a proposed ‘programme of change’.
The recession has had a greater impact on charities than originally predicted and future forecasts are bleak, according to a survey published today. Almost half (45 per cent) of 198 charities questioned experienced a drop in income in the last six months, and a third (30 per cent) reported no growth. More than half (56 per cent) now expect to see further decline in the next year.
Whether we like it or not, our world is about to get a whole lot smaller. That’s the view of economist and author Jeff Rubin who recently released the fascinating but frightening book entitled 'Why your world is about to get a whole lot smaller'. I’d suggest all fundraisers read it, for it has connotations for all of us. Now granted, this is one man’s opinion.
Fundraising through a recession will be a key focus of the International Fundraising Convention later this year. In response to the global economic downturn, convention organisers have devoted a significant proportion of their programme to the recession.
Statutory funding could provide a lifeline for charities during the recession. But first, organisations need to hone their campaigning skills to convince funders to part with their money, says Penny Mordaunt With newspaper headline writers preoccupied with political re-shuffles and parliamentary expenses you could be forgiven for thinking that the recession had bottomed out. Likewise, some commentators have accused the sector of “crying wolf” over voicing their concerns that individual and company giving would decrease sharply this year, citing trends during the great depression as evidence for this.
In April, the Association of Charitable Foundations conducted a survey of its members to explore the prospects for grantmaking in the short and longer-term. The results paint a broadly positive picture for charities seeking funding, says David Emerson The recession has hit the stock market hard, and as trusts and foundations have much of their assets in equities, anyone might expect them to have been badly affected.
Major donors show no signs of winding back their giving, according to a survey released today. Nearly nine in ten philanthropists at a recent forum said that they planned to increase their giving (42 per cent) or maintain their current levels (45 per cent) over the next year, regardless of the economic downturn.
A small charity has managed to secure a full refund of the money it lost in the Icelandic bank collapse last year by claiming it was a retail depositor. Kaupthing, Singer and Friedlander has returned £261,000 to the League of Friends of Brampton and District War Memorial Hospital, which had had the money tied up in the bank at the time of its collapse last year.
Face-to-face fundraisers signed up 16 per cent more donors in the last financial year than in the year before, according to latest figures. Street and door-to-door fundraising brought in 681,000 new donors in the 2008/20009 financial year, according to figures released by the Public Fundraising Regulatory Association (PFRA) at its annual general meeting yesterday, 24 June.
On a day that even the Iranian uprising has been relegated to the inside pages of high-end newspapers, it's important to remember those stories that get lost in the news cycle.
Arts Council England has unleashed a recession hardship fund for the arts worth double the value of that released by the Government for the entire voluntary sector in the Budget last week. A £40m grants programme has been opened up by the Council for artists and arts organisations struggling as a result of the recession. It follows the unveiling of a £20m hardship fund for the sector as a whole released as part of the Budget last Wednesday, 22 April; a fund which divided opinion among charities.
Legacy income has fallen over the last 12 months, but it could drop even further, according to the latest figures. After years of strong growth, the past year has seen a drop of 2.4 per cent in the value of legacy income according to the Legacy Market Monitor, which tracks legacy revenues of 38 charities. Among the 38 charities which form the Legacy Market Consortium, and which represent 56 per cent of the legacy market, income from legacies declined by £21m. But, the Monitor authors warn that the market has yet to bottom out, predicting that income from the valuable stream could yet fall by up to 10 per cent from its peak in 2008.
The tactics employed by an Australian charity on the brink of a financial crisis helped treble their appeal from the same time last year. You won't beat this for the most powerful piece of copy you can write.
