Charities fear the need for mergers

Mathew Little

Most charities fear reduced income will lead to mergers or closures within three years, according to a poll by law firm Bircham Dyson Bell.

The survey of 86 of the top 300 charities, carried out in the first three months of 2006, found unease over "giving fatigue" and falls in government funding.

Of the respondents, 73 per cent stated that the combination could lead to "many organisations having to merge or face extinction".

Penny Chapman, head of Bircham Dyson Bell's charities group, said the sector was bracing itself for a turbulent period. "At a time when the sector has a higher profile than ever, with a new Office of the Third Sector and overtures made to the sector by all political parties, it seems charities are having to face tougher challenges with more limited resources," she added.

The research also uncovered a feeling among charities that they are "under fire" from excessive regulation. This included the new Sorp, EU regulation and compliance with the Gift Aid regime.

Many charities were also concerned by the prospect of waves of secondary legislation to implement the provisions of the Charities Bill.

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