FSI warns ‘ceiling of giving’ is reached

The Foundation for Social Improvement (FSI) has warned that charity income may be flat-lining as a “ceiling of giving” is reached.

A new report by the FSI, entitled ‘Taking the Pulse of the Small Charity Sector’, reveals that 82 per cent of small charities reported that their statutory income levels remained unchanged in the three months between December 2016 and February 2017, while 53 per cent said their voluntary income had deceased.

The analysis, carried out by the FSI which surveyed 277 charities, adds that only the North and the Midlands have seen an increase in voluntary income this quarter, of 3 per cent and 1 per cent respectively.

Pauline Broomhead, chief executive of the FSI, said: “Having attended the launch of CAF’s UK Giving Report 2017, they like the FSI are seeing a flat-lining of income to the sector which indicates a ceiling in giving may have been reached by givers in the UK.

“At a time when the current commissioning environment poses a major threat to the long-term sustainability of small and local charities and community groups, and the demise of grants and rising contracts there has not been an increase in voluntary income to support the continuation of services, let alone the rise in demand that small charities and local and community groups are experiencing.

“The work of small charities is vital and if they are to continue to exist for their beneficiaries it is imperative that trustees are investing in the skills of their staff and volunteers and looking at potential collaborations or mergers with each other.”

Ms Broomhead warned that charities needed to improve both their fundraising and getting across their message to those who would support them.

She added that such improvements would “require trustees to invest in upskilling their staff to ensure that they are at the top of their game when it comes to securing funds through voluntary means”.

The FSI’s Charity Index Report also found that:

  • 71 per cent of charities surveyed experienced an increase in earned income this quarter
  • 65 per cent of small charities reported an increase in demand for services this quarter, with 31 per cent saying it was unchanged
  • 71 per cent of charities asked work in partnership with other charities
  • 80 per cent of those charities surveyed hold reserves, with 62 per cent of those saying they maintained the level of reserves over the previous quarter

At Moore Thompson, we have extensive experience of helping charities to maximise their funding and investments. We can also help identify suitable grant funding opportunities. For more information, please contact us.