Confidence is running low

A survey by the National council for Voluntary Organisations (NCVO) has reported that nearly 40% of charities and community groups are in a worsening financial situation.

It also found two in five organisations had seen their financial position deteriorating in the past month.

Some eight out of 10 organisations predict the crisis will negatively impact their ability to deliver planned objectives over the next 12 months, according to the Covid-19 Voluntary Sector Impact Barometer.

One in 10 believe they will be forced to close within a year.

The barometer is one part of a new research project – Respond, Recover, Reset: The Voluntary Sector and Covid-19 – led by Nottingham Trent University, the National Council for Voluntary Organisations and Sheffield Hallam University.

It will use real-time data to explore the impact of the pandemic on voluntary organisations over the next year.

Commenting on the findings, Karl Wilding, chief executive of NCVO, said: “Whether through falling income from charity shops and fundraising events, or a surge in demand for services from those facing the brunt of the pandemic, charities are under pressure like never before.”

Daniel King, professor of organisation studies at Nottingham Trent University and project lead, said: “Our research is confirming what many working in the voluntary sector already knew: charities and community organisations are facing the biggest challenge in a generation, and sadly some will be forced to close their doors.”.

In addition, 60% of the organisations said that Covid-19-related safety measures have increased their operating costs.

Researchers also found the pandemic is accelerating digital transformation in the sector, with charities moving existing face-to-face services online and funders supplying local charities with Zoom licences.

More than 90% of organisations reported an increase in delivering their services online.