Planned giving on the increase

Donating by direct debit is growing steadily while spontaneous giving is on the decline, a recent survey by the Charities Aid Foundation suggests.

The study, carried out for National Giving Week 2005, shows that in 2004 15 per cent of households giving to charity preferred to donate by standing order or direct debit, compared with 10 per cent in 2001. And although 17 per cent of households made a one-off, spontaneous gift to charity in 2004, that number is down from 23 per cent in 2001.

Planned giving, including tax-free Payroll Giving, now represents 46 per cent of total giving by UK households, up from 30 per cent in 2001.

Spontaneous giving represents 54 per cent, down from 70 per cent in 2001.

John Thurley, director of National Giving Week, said the growth in planned giving was excellent news for charities.

"Charities rely heavily on one-off, spontaneous donations, but by planning your giving you can ensure that every penny is tax-efficient and helps charities to plan ahead," he said.

But Professor Adrian Sargeant, founder of the fundraising website charity facts.org, said it was naive to expect that direct debits would ever replace spontaneous gifts completely. "This just isn't going to happen - certainly not in our lifetime," he said.

Sargeant said the growth in direct debits was occurring at the expense of cheques. "It is not collection plates and tins that will suffer over time, but rather the future of cheque donations," he said.

He pointed to the trend in the past five years of charities almost universally switching their focus from generating one-off gifts to the solicitation of regular donations because the economics are so much better. But he added: "Some charities are reverting back, just a little, to using the solicitation of one-off gifts because when they do this they attract an older profile of donor who is more likely to be a better legacy prospect."

According to Sargeant, one-off givers are about 10 years older on average than direct debit donors.

ALSO...

The number of small and medium-sized enterprises signing up to Payroll Giving has more than doubled since the Payroll Giving Grants scheme was introduced in January. The programme rewards SMEs for making Payroll Giving available to staff before the end of 2006. It offers up to £500 to the business and matches the first £10 donated by each employee every month for the first six months.

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