Donations 'will survive the credit crunch' but charities prepare for a legacy drop

By David Ainsworth, Third Sector, 20 August 2008

RNLI: could be hit by fall in legacies, which make up a large part of its income

Individual donations from the public are not expected to drop during the credit crunch, but legacy income could fall away, sector fundraisers have predicted.

Some large fundraising charities said they also expected costs to rise and beneficiary numbers to increase. Oxfam is preparing for possible staff and service cuts to cope with diminishing funds (Third Sector Online, 13 August).

"We haven't seen any effect on our voluntary income," said Giles Pegram, director of fundraising at the NSPCC. "Evidence and experience suggest that downturns in the economy don't have much effect on individual giving."

Pegram added that he was unsure what effect the economy would have on regular giving.

Richard Turner, director of fundraising at ActionAid, said it was a good time for charities to ensure they were offering regular donors a good service. "We have strong products and we've found that when incomes drop, something like child sponsorship is one of the last things to go," he said.

He added that ActionAid had seen rises in its costs and the number of people needing its help: "We're having to deliver more aid, and it's costing us more to do it."

Paul Breckell, finance director at the RNID, said there was no evidence that there would be a drop in legacies, but he said that, with house prices falling, the charity had downgraded its estimate for this year.

The situation could be more serious for the RNLI. Richard Popper, head of central fundraising at the charity, said legacies made up the majority of its income. The charity was also seeing the cost of fuel and materials rise.

Liz Cox, deputy director of fundraising at Barnardo's, said: "We're monitoring everything. If anything changes, we want to be able to react quickly."

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