NPC releases guidance for funders to help charities through cuts

18 Oct 2010 News

New Philanthropy Capital has released its report for funders on helping charities through cuts, calling on grantmakers to simplify the application process and monitoring to ensure the system is "fit for purpose".

Funding changes

New Philanthropy Capital (NPC) has released its report for funders on helping charities through cuts, calling on grantmakers to simplify the application process and monitoring to ensure the system is "fit for purpose".

'Preparing for cuts' highlights the plight that many charities will face following Wednesday's cuts stating that between a fifth and a quarter of government funded charities "will feel the cuts badly".

In response to the expected increase in applications the report calls for grantmaking processes to be "fit for purpose" by cutting complicated application procedures and monitoring and evaluation requirements to speed up response times. It also calls for "a culture of open and honest exchange" to give charities the confidence to warn funders of impending difficulties.   

Funders should also prepare for a greater variety of requests, says the report.

"Funders must expect to receive requests from charities that will take them outside their comfort zone. Financial risks will escalate," said a spokesperson for NPC, "So funders will need to spend more time understanding what charities need in order to adapt and survive rather than offering charities limited options. If funders do not support good charities to make the transition to life under the cuts, they may disappear. Some funders are developing emergency funding schemes to deal with short term demands."

The report says charities more than ever will need to be able to demonstrate impact and advises funders that choosing charities with strong evidence of effectiveness will boost impact, but choosing to "strengthen weak charities" may be a worthwhile risk. 

It also advises that charities must look for alternative funding from individuals and the public whilst warning that many small and mid-sized charities may not support causes attractive to the public or "have strong fundraising bases to pull in public pounds". NPC advises that charities will need to partner each other and the private sector in order to be more attractive to commissioners. 

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