Charities facing double whammy during covid

Three-quarters of charities say they are facing a double whammy of an increase in demand for services, combined with a decline in income.

Charities are facing a double whammy of a rise in demand for services, combined with a drop in income.

Not-for-profit organisations with levels of unmet need not previously experienced this century - while 83 per cent are bracing themselves for a drop in income.

Over a third of charities say they are anticipating a drop in income of more than 25 per cent over the next 12 months relative to their pre-crisis expectations, according to the Covid Charity Tracker

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Just over a third expect their income to decline by more than 25 per cent, while two thirds of charities think it will take more than a year to return to pre-crisis income levels.

Matt Whittaker, chief exeutive of Pro Bono Economics, which authored the report in partnership with the Chartered Institute of Fundraising and Charity Finance Group, said: “Charities have demand for their support coming from every direction, and it shows no signs of dissipating. Challenges that existed before the pandemic have not gone away. The fallout we see today in terms of isolation and mental ill health is expected to continue.

"Then there are backlogs to tackle, while economic consequences worsen. At a time when resources are diminished, it all adds up to charity crunch where need outweighs the sector’s ability to meet it next year. As the government considers how to soothe the social scars Covid has created, charitable organisations can be a core ingredient of the balm the country needs. But the sector can only play that crucial role if ways are found to urgently inject more resource.”

Caron Bradshaw, chief executive of Charity Finance Group, said: “Our communities are struggling with the direct and indirect impact of this pandemic and 2021 is expected to be another difficult year for many. Charities are the backbone of society and have proved their value time and again during this crisis. What Charities offer and deliver is essential to those people who rely on them.

“Our research shows that charities are seeing rising demand from both existing and new beneficiaries, while their capacity to meet that demand is becoming ever more constrained. However, more than two-thirds of charities say they expect it will take at least a year to see income levels return where they were before the crisis and we know it took them over 10 years to recover from the 2008 crash. Relatively modest investment to support charities to meet those demands now could make the difference between permanently losing what they offer– depriving generations to come – and preserving their services.”

The survey showed a dual source for the ongoing increase in demand: firstly, people turning to charities’ services for the first time; secondly, existing service-users seeking more support than previously.

Daniel Fluskey, head of policy and external affairs at the Chartered Institute of Fundraising, said: “Once again we are seeing the huge challenges that charities face in being able to meet need and demand. Nine months into the pandemic, things are not getting any easier, and while charities have cut costs and made savings wherever possible, too many are simply now running on empty. It’s a matter of time before we lose some charity services, or organisations, for good."

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