Giving by the UK’s 100 largest family foundations is likely to rise next year following increases in their income and assets during 2013/14, a new report shows.
The seventh Family Foundation Giving Trends survey, published by the Association of Charitable Foundations, says that the 14 per cent rise in total income of the top 100 family foundations to £1.26bn in 2013/14 bodes well for levels of charitable spending next year because "spending trends tend to follow those for income and assets, but with a one-year time-lag."
The report shows that donations to the top 100 foundations totalled £362.2m last year, up from the £301.9m donated the previous year – a rise of 20 per cent in real terms. Four family foundations received voluntary income which was £20m or more higher than the previous year: the Dr Mortimer and Theresa Sackler Foundation, the Lempriere Pringle Trust, the Zochonis Charitable Trust and the Gatsby Charitable Foundation.
Total income includes investments and endowments, which also increased by 11 per cent on the previous year’s figures.
Asset values rose by 13.9 per cent in real terms over the period to £41.6bn – almost £4bn more in real terms than in 2006/07.
The report by the Centre for Charitable Giving and Philanthropy at the Cass Business School uses figures in the most recently available annual reports of the top 100 family foundations based on the annual value of the grants they give out.
The report says that giving by the top 100 rose by by 3.2 per cent in real terms to £1.59bn last year.
The Wellcome Trust retained its status as by far the biggest giver among foundations of all kinds last year, making grants worth £487.7m in the year to September 2014 – more than seven times the £68.6m given out by the second-largest family foundation, the Children’s Investment Fund Foundation, in the year to August 2013.
While the Gatsby Charitable Foundation was the second-largest grant-maker in last year’s report, having given £145m in the year to April 2012, it gave out less than £30m in the year to April 2014.
Giving by family foundations – defined as those founded through family, individual or family business wealth – accounted for 56 per cent of all foundation giving by value in the UK, compared with 45 per cent in the US.
Cathy Pharoah of the Centre for Giving and Philanthropy, who led the survey, told Third Sector: "We find that foundation spending in one year is based on the amount of funding they receive in the previous year, so if their assets are rising one year, they will have more money to spend the following year. It doesn’t affect grant commitments they have already made, but where they’ve got any discretion and freedom, they’re very responsive – as soon as they get more money, they spend it."
The 100 foundations selected to form the basis of the study varies each year according to the value of the grants they make. If the data from this year’s report was compared with that in last year’s report, it would show that total income rose by 30 per cent, up from £970.3m in 2012/13, with donations rising by 55 per cent from the £233.2m donated to the previous year’s top 100.
It would also show that while asset values rose by 23 per cent in real terms over the period, giving actually fell by 2 per cent from the £1.63bn documented the previous year. In last year’s report, the ACF had expressed concerns that the 35 per cent drop in donations to family foundations seen that year could lead to a decline in grant-making to charities in future years.