Charity leaders were more positive about the sector’s prospects in February then they were three months earlier, but most are still worried about the year ahead, according to a new survey by the National Council for Voluntary Organisations.
The proportion of senior staff and trustees who thought economic conditions in the voluntary sector would worsen in the coming year fell by four percentage points between November 2011 and February 2012.
But 90 per cent of people polled for the quarterly Charity Forecast Survey still expect a tougher economic environment for charities in the next 12 months.
More than half – 52 per cent – of the 145 respondents thought their charities' finances would worsen in the coming year, but this figure has dropped by 13 percentage points since the last quarter.
There was a five percentage point rise in the number of charities planning to hire more paid staff in the next three months – from 20 per cent in November 2011 to 25 per cent last month.
The proportion of charities planning to cut the number of staff in the next quarter held steady at 28 per cent, but was far lower than the 55 per cent recorded a year earlier.
The NCVO said charities might not be planning more job cuts because they had already shed all the jobs they could.
The proportion of charities planning to cut spending over the coming year fell by 19 percentage points to 47 per cent in the year to February, while the proportion planning to spend more rose by 11 percentage points to 35 per cent in the same period.
There was also a nine percentage point rise over the year, to 32 per cent, in the level of charity leaders planning to increase services.
Senior charity figures were also more positive about the voluntary sector economy than that of the UK as a whole. For the past nine months respondents to the survey have said the sector’s economy was healthier than that of the UK as a whole, but for the preceding two years the reverse was true.
Sir Stuart Etherington, chief executive of NCVO, said: "While confidence levels have inched up slightly since the last quarter, the overall picture for the voluntary sector remains grim and the Budget offered little comfort for charities currently struggling against a tide of multiple financial pressures.
"The government needs to send a strong message to the charity sector that it will support the vital services it provides, but instead yesterday’s Budget sent out mixed messages that seem to be at odds with their big society vision."