97 per cent of charities have an income of less than £1m, but they share 20 per cent of the money that goes to the sector
I probably quote this statistic at least 10 times a week. I tell stakeholders who tell me that there’s a problem with trust in the sector, small charities who think they’re alone and sometimes I mention it on Twitter. As the editor of this publication highlighted, I’m actually wrong. This is a statistic used for ease but the truth is, with an estimated 200,000 unregistered “micro charities” in the UK, the figure is more like 99 per cent.
You could make the argument that this statistic is used to show that small charities should grow their income and become ‘big’. But that is not my intention or why I make myself sound like a parrot week after week.
74 per cent of charities in England and Wales turn over less than £100,000. As a helpful tweeter calculated, even if you took the 123,230 charities in England and Wales who have an income of £100,000 or less and gave them each a £50,000 gift, there would be an additional £6bn between them and yet they would all still be small.
I work for the Small Charities Coalition, a membership organisation representing over 9,000 small charities, not only giving them greater representation, but also providing a number of vital services including a support line, training and mentoring. I’m incredibly proud to champion the work of all small charities, registered and unregistered, across the country.
I am also supportive of our member's growth ambitions - some are the perfect size for what they want to achieve and their ambitions are to maintain their small but vital purpose. Some want to grow slightly bigger, others want to merge with bigger organisations, many just want to be financially stronger and a minority have huge growth goals that they will one day no longer be small. They’re all part of the ecology of the rich civil society in which they exist.
So when I use that 97 per cent figure, I’m trying to tell a story that’s more complex than it first seems. For me, that story is of small charities across the UK doing spectacular work, in spite of having a very small piece of the pie.
So one argument might be, why do such spectacular small charities need more money?
In 2014/2015, the economic footprint of small and medium charities was £7.2bn, accoriding to IVAR, much of which was invested locally. This is particularly impressive given that 91 per cent of small charities have no paid members of staff and are entirely volunteer-led and delivered.
Small charities have small budgets and we often hear that they are struggling to get by. Jane Ide - chief executive of Navca, the national membership body for local voluntary sector support and development, pointed out on Twitter, “I can also see that many tiny voluntary organisations manage perfectly well without additional funding - my community choir, for example. But charities inevitably carry some costs even if they are entirely volunteer-led and delivered - photocopying, travel expenses, governance.”
I’ve spoken to small charities with small budgets, who carry out vital work and support communities across the country and each does so in different ways. They might provide homeless people with safe accommodation, work with engineers to help people with disabilities to lead more independent lives, support vulnerable mothers in communities, celebrate the diversity and contribution of BAME people, provide advice and support on a less well-known health condition, protect an endangered animal in another country, host community Christmas lunches for the elderly or run community fridges and local food banks. There are those who are the national voices for their cause, small charities working internationally and those who exist only in their local community. Some work with big charities, some work independently, some in networks and others may work with local authorities.
In the same way that their causes are diverse, so are their finances. Some small charities have all the money they will ever need and some are so over-stretched they might not be in your community next year.
The 2016 Localgiving Sustainability report showed that only 46 per cent of charities are confident that their organisations could sustain themselves financially over a five-year period. Despite nearly 5 out of 6 people using an average of three charity services a year (IPPR, 2014), one-third of charities with an annual income of less than £1m are in a financially precarious position, operating with no reserves. (NCVO Almanac 2016)
I think small charities are extraordinary, but they cannot do what they do at zero cost. And let’s not forget that there are some socio-economic groups that are excluded from volunteering, unable to donate hours of their time. I personally think we should be encouraging all small charities to cover the expenses of volunteers, but that’s a blog for a different day.
I celebrate small charities and advocate that they need more money. I use the 97 per cent figure to demonstrate that the majority of the sector is made up of small charities and changes need to be made to accommodate this and to inspire people to give to small charities and champion their work. It might be through offering them a mentor, advocating for a funding process to be more accessible or simply acknowledging the work these small charities do.
It’s true, turnover doesn’t approximate to your power to do good, but for those who need it, any amount of money that shifts the balance a bit could make their existence easier and the number of people they are able to reach larger. That can only be a good thing. Even for a community choir to keep going, someone has to foot the bill on the photocopying to print the music.
Most charities in the UK are small and to me, that means powerful and knowledgeable.
There are hundreds of thousands of different charity plans, all of them as valuable as the next. I would go so far as to say that it’s dangerous to say small charities don’t need more money. Don’t assume that all small charities are thriving, that they can all run for free and that they will always be there, the data tells a different story.
As a society, we cannot simply cross our fingers and hope that these organisations can continue to add such vital social and economic value to our communities without a cost. So don’t be afraid to make an economic donation to their work, as well as a social one. It might not be until these small charities don’t exist that we realise just how much value they’ve been adding.