Philanthropy: Recession 'requires spend-down giving'

Report offers suggestions for wealthy donors to help charities through recession

Philanthropists should adopt a 'spend-down' strategy to help charities through the recession, according to the Institute for Philanthropy.

In a new paper, Giving in a Recession, the institute outlines ways in which philanthropists could boost charity funding during an economic downturn.

The paper suggests they should consider 'spending down' by dipping into their reserves and donating fixed sums within designated timeframes rather than giving away small amounts over longer period of time.

"We are not suggesting someone spends down their entire philanthropic resources," said Jessica Sklair, director of research at the institute, which works for better understanding of philanthropy. "But we are encouraging them to temporarily increase donations during times of need."

Family philanthropists might be in a position to increase funding in a way corporate and individual donors were not, she said. "Many philanthropists who choose to spend down do so in response to an emergency or crisis," said Sklair. "We would argue a recession is a similar situation."

Susan Mackenzie, director of Philanthropy UK, which advises people on effective giving, said spending down was part of a trend for 'giving while living'. "The pitch for charities is the same as for other asks," she said. "It is about explaining the need and asking donors to respond."

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