Age UK has recorded a rise in its voluntary funding but posted a third consecutive operating deficit as costs rose and plans to draw further from its reserves.
The national older people’s charity saw its total income rise by £10m to £132m in the year to March 2025, driven by an increase in institutional funding.
However, the charity also its expenditure rise by £7m to £135m, with the cost of running its chain of charity shops increasing due to inflation and minimum wage uplifts.
The charity’s deficit last year was planned, the recently published accounts read, but trustees “are cognisant that Age UK needs to return to a break-even budget”.
“A further deficit is expected in the 2025-26 year as strategic development continues, utilising free reserves,” the accounts read.
Age UK, which has a network of local organisations across the country, saw its total funds decline by around £7m to £50.4m.
Redundancy costs up
Age UK saw money from grants, corporates and trusts increase from £18.2m to £30.1m.
This includes £5.25m from the Omaze Christmas draw in 2024 and grants from the Rothesay Foundation, the Julia Rausing Trust, Skipton Building Society and Dunelm.
The charity also received £4.1m more in funding received from the Disasters Emergency Committee through its Ukraine, TurkeySyria and Middle East Humanitarian appeals.
Other fundraised income was relatively flat, with legacies, its largest source of voluntary funding, dipping to £25.8m.
Retail income dipped by £800,000 to £38.7m while the costs of running its charity shops rose by almost £5m to £38.2m.
“The charity retail market has had a tough year, with rising costs and a challenging climate for donated goods with the continued rise of online second-hand goods marketplaces,” the accounts read.
“Costs of running the shop network have also significantly increased following increases to national living wage and other inflationary pressures.”
Income from charitable activities increased to £4.2m from £3.4m the year before, including £3.2m from energy companies to fund its warm homes programme.
Total staff costs increased by almost £3m to £52.0m in 2024-25, while the charity’s average number of employees edged higher to 1,317.
During 2024-25, the charity spent £638,000 on redundancy costs, up from £182,000 the year before.
