Charity donations subject to gift aid have increased by 95 per cent in the last decade despite a significant slow-down in the latter half, according to the first Halifax Giving Monitor.
Looking only at donations subject to gift aid the new research compiles a range of statistics including those from the Office for National Statistics, the HMRC and further consumer research on behalf of Halifax by ICM Research. The results are presented in real terms after allowing for inflation.
They showed that charity donations rose dramatically by 60 per cent between 2000/01 and 2005/06, slowing to a rise of 21 per cent between 2005/06 and 2010/11. The amount donated through gift aid in 2010/11 sat at £3.8bn, as opposed to £2bn in 2000/01.
Gift aid was initially introduced in 1990 although it was limited to cash gifts of £600 or more initially. This threshold was periodically reduced until 2000 when the limit was removed entirely. The figures show that since then donors have been increasingly taking advantage of the gift aid scheme when giving.
However recently there has been a significant slow-down. Across the decade there was an average annual rise of 7 per cent, but the past year has seen an increase in donations of just 2.1 per cent, the research shows.
The value of gift aid donations has also risen steeply over the decade from an average of £130 in 2000/01 to £223 in 2010/11, but this value has dropped from the recorded high of £252 in 2008/09.
Donors will not give if they can't afford to
Ollie Williams, policy officer at the Institute of Fundraising advised: “The rapid increase in gift aid donations in the early part of the decade was a natural consequence of the scheme becoming available. While there are many factors that have affected the reduction in charitable giving by gift aid per person, the current economic climate has had a significant impact.
“Overall total donations have increased, as have the number of people giving, however, in these hard economic times they are each individually giving less, meaning a reduction in gift aid."
Alluding to the recent slow-down, Anthony Warrington, director of current accounts at Halifax, said that research highlighted a correlation to households' disposable income:
"The research indicated that charity donations are likely to be susceptible to an adverse change in household finances. 72 per cent of people would stop donating financially to charity if they felt that they could no longer afford it and two in five people who currently donate would not be willing to give up anything to maintain their charity donations."
The monitor also researched donor trends in giving using gift aid and found that the over-65s are the most willing to give, with two-thirds of all those in that age bracket donating to charity in the last month, as opposed to one-third of those between 18 and 34-years.
Further results echoed those of CAF and NCVO's UK Giving Report, showing that health charities are the most popular among UK donors and that giving cash to official collectors is still the most popular way to give.
A spokeswoman for Halifax advised that the research was being conducted as a "tester for the appetite for this kind of information" and has not been done in comparison to other similar monitors. "It is simply a monitor we have produced, we do this for lots of sectors, house prices, savings levels, spare time spending affordability etc. It is a new strand to this activity," she said.
The bank currently has no charity department and the monitor is not an indication of an interest in deeper relations with the charity sector, she advised.
