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ACCORDING to a survey by
PricewaterhouseCoopers, the Institute of Fundraising and the
Charity Finance Directors’ Group, charities are facing a £2.3bn
black hole in their finances.
Ironically, the need for
charities will grow as the recession bites and their funding
dwindles. I’m feeling it already as worried charities ask me
what they should do. Careline, which provided a vital helpline
for people in trouble, has already closed down. I fear others
will follow.
Friends joke about
shunning the High Street and shopping at charity shops but they
rely on donated goods. There will be less of those for a while
as donors make do and mend or sell unwanted goods on eBay.
Shelter offers advice
on mortgage problems, homelessness, keeping warm and coping with
rent arrears. As a rise in repossessions precipitates an
increase in demand, banking donors have pulled the plug. Shelter
lost £400,000 in six weeks this autumn when corporate sponsors,
including the nationalised mortgage lender Bradford & Bingley,
cancelled donations. The charity has had to lay off staff. The
British Red Cross cancelled its winter ball in London, which
usually raises £500,000, as it could not find a corporate
sponsor.
A fifth of charities
report increased cancellations of direct debits by individual
donors. Donations from legacies have also slumped, according to
the survey. Of charities polled, 86% expected legacies to either
decline further or remain static over the coming year. The Money
Advice Trust, which provides free advice for individuals
struggling with debts, relied heavily on corporate donations.
Five high street banks each gave it more than £500,000.
As that income vanishes
more and more people will need that trust’s advice. I fear they
will find it harder to access unless government funding plugs
the gap.
It is said that RBS
gave £57m in cash and kind last year, Barclays £52.4m and HSBC
£50.7m. Can you see them giving anything like those sums in the
coming year? And yet it has never been more vital to keep
charities afloat.
Hard as times may be, I
hope we will all dig deep.
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