Barnardo’s income nears £300m as retail sales rebound

05 Jan 2023 News

Barnardo’s income grew to almost £300m in 2021-2022, partially due to renewed success in retail, its accounts show.

In the year to March 2022, the charity spent £274.6m, compared to £281.4m from 2020-21, including restricted expenditure of £12.8m.

At the end of 2021-22, the charity “was in a positive financial position, after taking tough and prudent decisions at the height of the pandemic”.

Indeed, total income was £299.5m which was £19m higher than in 2020-21 and £1.6m higher than budgeted. When adjusted for one-off Covid-19 grants from the government, income grew by £41.7m in 2021-22. 

Income from trading was £77.8m, compared to £30m the year prior. In 2021-22, Barnardo’s made a surplus of £25.0m, compared to a surplus of £8.1m for 2020-21. 

The charity ended the year in a strong reserves position and it plans to invest in its staff and technology.

“We must make sure our pay and rewards reflect the market and help to support our highly committed colleagues through the cost-of-living crisis, particularly those on lower pay,” the report says.

“We also have significant technical debt, given historic underinvestment in technology, and a curtailment on spending during the pandemic.”

The accounts add that children and young people are continuing to face uncertainty and disruption during the pandemic, and warn of the impact the cost-of-living crisis may have.

Challenging year for fundraising 

The accounts add: “The second year of the pandemic continued to be challenging for the charity sector, particularly fundraising. While shops were largely open, it was challenging to adapt to Covid-19 regulations and safety measures. 

“Meanwhile, face-to-face fundraising and events remained largely impossible, so we had to rethink our fundraising approach.”

Nonetheless, the charity met its target of £41.5m (£32.7m net), including legacies.

It received 113 fundraising complaints, which is an increase from the 69 complaints the year before, partly due to an increase in face-to-face fundraising activity taking place after Covid-19 restrictions were lifted. 

The charity did not receive any fundraising complaints that were formally investigated by a regulator.

Income from donations and legacies was £37.2m, lower than the previous year (2021: £41.8m). 

The 2020-21 fundraising figure was boosted by its one-off coronavirus crisis appeal, which raised £2.4m. 

Some £17.2m of fundraising income was raised through legacies compared to £18.6m in 2021, while the accounts note “the external backlog administering probate continued during the year”.

It received £2.6m through its partnership with the People’s Postcode Lottery (PPL) in 2021-22.

Total sales across its retail estate grew 158% year-on-year to £78m, “driven heavily by lockdown measures easing and the re-opening of the high street”. 

Moreover, ecommerce sales (ebay and its online shop) continued to grow in 2021-22 to £2.1m, up 79% year on-year, “as donated stock levels increased following the Covid-19 lockdowns”. 

“This helped to achieve a 65% increase in the net income that helps us deliver vital services to children and families across the UK,” read the accounts.

Staff pay increases

The report shows the “most significant area of expenditure” is staff costs of £168.3m which increased by £3.5m from 2020-21, the increase being largely due to a 2% pay award effective from 1 April 2021 – it has since implemented a 5% rise.

The median pay gap remains below the national average of 15.4%, even after including furloughed colleagues in the calculation, though “we recognise that we have much more work to do to address the continuing pay gap”.

Executive pay was higher in 2021-22 than in the previous year, which was partly because the board appointed two Interim co-CEOs to lead the charity.

The highest paid staff member earned between £250,000 and £260,000.

The accounts also show £0.9m relating to redundancy, compromise and termination costs compared to 2021’s £1.4m.

In March 2022 the charity appointed Lynn Perry to the permanent role of chief executive.

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