Great Fundraising Organizations, by Alan Clayton. Book cover.

Credit crunch means rising costs and increased demands on charities

A survey for the Charity Commission has confirmed that charities are being squeezed by both an increase in demand for their services and increased costs amid the credit crunch and financial crisis.
The survey of 514 charities reveals that 38% of them have reported that they have been hit by the economic downturn of the last year. Twenty one per cent reported an increase in demand for their services over the last twelve months.
At the same time, 54% said they had had to deal with increased costs in things such as energy, food and travel.
One in four charities that collect monetary donations reported a decrease in donations. Of these, one in 12 said that they had had to make redundancies as a direct result.
The representative sample of just over 500 charities was interviewed by telephone between 17th September and 30th September 2008, so before the Icelandic banks crisis emerged.
The survey included charities with incomes of less than £10,000 a year up to charities with incomes of more than £1 million a year.
Of the 190,000 charities registered in England and Wales, two thirds have an income of less than £10,000 a year, and 9,000 charities have an income of more than £500,000 a year.
The Commission is providing support and advice to charities via its helpline on 0845 300 0218, in particular with regards to the collapsed Icelandic banks. One charity that has been in touch with the regulator had £11 million deposited.
It is also asking charities that have been affected by the collapse of Icelandic banks to come forward, so that the full extent of the impact on the sector can be properly assessed.
Dame Suzi Leather, Chair of the Charity Commission said: “Charities, like many organisations at present, are facing a great deal of uncertainty, and for some the situation could get much worse. Even before last week’s problems with Icelandic bank collapses, some charities are really being squeezed by higher costs and higher demands for vital services. They will wonder how they are going to survive the current crisis whilst trying to continue meeting people’s needs”.
She added: “Most importantly, I really want to encourage people to keep supporting and giving to our charities in these difficult times. They need our help more than ever.”
www.charitycommission.gov.uk

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