Coronavirus and fundraising: So where are we at?
Peter Lewis, Chief Executive of the Chartered Institute of Fundraising, takes a look at the state of UK fundraising in the setting of the coronavirus pandemic, following the Easter Bank holiday weekend.
It was a very long and challenging three weeks for everyone before the Easter Bank holiday. Personally I have never seen such collaboration between the umbrella bodies, and never had so many meetings with Ministers and officials in such a short space of time. I’ve also never had to work so hard with my team at the Institute of Fundraising in such an intense way to redesign how we best serve the fundraising community. I am so proud to lead such a focussed and committed team.
So I wanted to jot down a brief summary of where I think we are at, what things are clear and where we are still awaiting clarity.
1. Fundraised, trading & investment income down
Fundraising has been hit incredibly badly over the last four weeks, with public fundraising, community and events fundraising on hold, and overall giving levels being hit as the general public feel the squeeze. Our best estimate remains a £4.3 billion reduction in income over the first 12 weeks of the pandemic, a 48% drop in voluntary income for the year ahead, and a 32% drop in overall income as trading and investment income has also been hit badly.
This has hit all sizes and types of charity, simply based on their business models.
At the same time the demands on the sector as a whole have increased.
2. The government response
The government finally announced its emergency package for charities on 8 April, comprising £310 million for the National Lottery Community Fund (NLCF), primarily aimed at smaller charities with income under £1 million, £60 million for the devolved administrations, and £360 million from a variety of government departments, as yet unknown. The implication is that this £360 million from government departments is for larger charities, including organisations like St. John’s Ambulance, MIND, Citizens Advice and hospices. The government has been clear that it will take it 2 to 3 weeks to give clarity about the exact focus of its emergency funding to NLCF and from the other government departments.
There is also a slightly confused “match” funding promised, with Treasury saying it will match what is raised from the public on the Big Night In on 23 April with a donation of at least £20 million to the National Emergencies Trust (NET). On the face of it, this does not make any sense. To benefit from the behavioural nudge of government support, their match needs to apply pound for pound to the funds being raised for Children in Need and Comic Relief, rather than the NET, perhaps with a separate donation of £20 million to the NET. Watch this space for clarity.
Even taking into account other sources of income coming into charities around the UK, including through the government’s Job Retention (furlough) Scheme, it is clear that the new money announced fall a long way short of the lost income. So some, if not all, charities will be worse off than they were before the crisis.
The National Lottery Community Fund (NLCF) & Trusts and foundations
The Lottery, Trusts and foundations have responded very strongly, and with speed, and a degree of collaboration that I very much welcome.
With a few exceptions, see below, the foundations are focussing on recovery and renewal, rather than emergency response, and are working hard to align all their funds.
As a part of this NLCF has brought forward £300 million of funding to set alongside its existing funding for this period, and has set clear criteria for the next six months prioritising funding organisations responding either directly or indirectly to the coronavirus crisis.
NLCF has also been clear that once it has clarity on the criteria set by government for the £310 million emergency funding it will receive. It will try and ensure it takes a simple, coherent approach to distributing this alongside its own funds, possibly through a single application process.
In London, a good example of a collaborative approach is the Community Response Fund, covering both funding for emergency response and essential redesign of services.
Looking at what we know on 10 April, my reflections would be as follows:
1. Funding for emergency response will come primarily from the government’s £750 million, where the detailed criteria is yet to be set, and is unlikely to appear for the next 2 weeks.
2. However smaller charities in England should be generally looking towards the NLCF for this funding, which in my view is likely to be aligned with the longer-term criteria they have already set out. The £310 million in emergency funding primarily for smaller organisations, looks relatively more generous than the package outline below for larger ones.
3. Larger charities, and by that I mean anyone over £1 million in income up to the very largest, should be looking more to their relevant government departments, to make sure they are part of the funding package DCMS announces in due course for relevant government departments. On the face of it, looking at the data on income levels and sources by size of organisation and subsector in NCVO’s Almanac, this package of £360 million looks very tight compared to the losses in income these larger organisations have experienced.
In this context I very much hope that some of these government departments will be able to provide more funding than the sums of money allocated by the Treasury to DCMS, otherwise many of these organisations, particularly perhaps health and social care charities, will really struggle to maintain their services to some of the most vulnerable people around the UK.
4. The other primary sources of emergency funding will be:
- From the NET through community foundations for very small organisations
- From Children in Need & Comic Relief, hopefully matched by government in full, following the Big Night In
Recovery and renewal
5. Trusts and foundations have responded quickly with a focus generally on recovery and renewal rather than emergency response. Some of these organisations are waiting to see the exact criteria of the government emergency response, so that they can target unmet need more accurately. Keep your eyes out for these new or repurposed funds.
6. And of course, fundraising, where possible, still has a vital ongoing role through this crisis, and it has been fantastic to see so many of our members responding with innovative and engaging approaches to inspiring donors to give. I expect far more of this over the days and weeks to come.
7. Indeed, over the next two weeks iconic fundraising events will take place – the first ever #BigNightIn bringing together Children in Need and Comic Relief shortly followed by the first ever 2.6 Challenge, starting on the day the London Marathon would have raised over £66 million for charities around the UK.
8. But we also know that many people around the UK are not simply worried about their own health, but also about of the health of their families and friends. Many are also in a much greater state of economic uncertainty or difficulty, having lost their jobs or been furloughed. Many are now living in more stressful or anxious households, due to the external environment.
9. So I would simply ask every single fundraiser around the UK to reflect on the national emergency we are all in, to keep your supporters absolutely central to your thinking, and to be very careful to ensure that while it is absolutely right to provide people the opportunity to give, we all need to make sure we are fundraising thoughtfully and respectfully at all times.
Peter Lewis is Chief Executive of the Chartered Institute of Fundraising
See this page for all the latest information for fundraisers about the coronavirus outbreak from the Institute of Fundraising. It will be kept updated.