Third sector bodies warn new UK income figures mask the challenges facing small and medium sized organisation
UK charity finances have only just surpassed pre-2008 levels, according to new research.
The sector’s total net assets hit £120.5 billion in 2007/8 before crashing to £94.4bn in 2008/09.
However, according to the UK Civil Society Alamanac, the sector was worth £121.3bn in 2015/16.
The alamanc is compiled by the National Council for Voluntary Organisations (NCVO) and includes data provided by the Scottish Council for Voluntary Organisations (SCVO).
However, both organisations warned that the figures reflect growth amongst larger organisations and the picture is very different for small and medium sized bodies.
Sir Stuart Etherington, chief executive of NCVO, said: “While some charities are going from strength to strength, others, smaller charities in particular, are struggling with the ongoing local government spending squeeze, or being pushed out of an increasingly competitive public services market.
As well as its overall assets, the sector’s net income also appears to be growing, having returned to above 2007/8 levels in 2013/14 and reaching a new high of £47.8bn in 2015/16, a 4% increase on the previous year.
However, income from government sources fell back slightly, declining 1% to £15.3bn.
The figures show that income from the public grew during this period, even though it was a time of heightened concern about fundraising methods.
However, the growth was seen predominantly in earned income, such as membership fees or charity shop sales, rather than donations. Donations from the public showed slight growth of 1%, to £7.8bn, while earned income from the public continued to show strong growth, increasing by 8%, to £11.4bn.
Etherington added: “The sector as a whole may have recovered from the impact of the recession, but there is clearly no shortage of risks out there for charities. The solutions, as ever, all come back to ensuring organisations have the strong governance needed to help them manage risks and to ensure they grasp opportunities.”
SCVO said it is currently compiling growth figures for Scotland, but early indications suggest growth in Scotland to be more slow than NCVO's figures suggest for the UK as a whole.
Ruchir Shah, SCVO’s head of policy, said: “Much of the growth recorded in this research comes from very large organisations, many of which are based in London, and it unfortunately masks the precarious funding situation for smaller and medium sized charities.
“In Scotland, we have seen a lot of crisis for charities delivering locally, as much of their government funding comes from local authorities where austerity has hit the hardest.
“SCVO is currently calculating its State of the Sector statistics and will present more detailed Scottish figures over the summer.”
