Survey of charity income growth fuels 'Tescoisation' claims

Former Conservative leader Iain Duncan Smith has described research showing a huge difference in the growth rates of big and small charities as further evidence of the 'Tescoisation' of the voluntary sector.

A report by think tank nfpSynergy shows that charities bringing in more than £2m have seen their incomes grow almost three times faster than smaller ones over the past 28 years.

Duncan Smith, who first referred to the 'Tescoisation' of charities in 2005, said: "I'm concerned about the extent to which it is happening. Small community groups and charities find themselves increasingly squeezed by big charities."

The nfpSynergy research, based on 550 charities, showed large organisations with annual incomes above £20m and medium charities with incomes between £2m and £20m had grown by 8.5 per cent on average between 1980 and 2008. Small charities had grown by 3.5 per cent over the same period.

Duncan Smith said big charities held "billions in reserves not used for anything that I can see helps improve people's lives".

They also wasted too much on lobbying and were too close to government, which rewarded them with more secure funding, he said. Small charities suffered chronic short-term funding and were being suffocated by bureaucracy, he added.

Patrick Cox, founder of the Small Charities Coalition, said he started the group to address the growing imbalance. "There was lots of talk, but there wasn't a single organisation doing anything about it," he said.

Cox said large charities should provide help to smaller organisations. "Even providing a trustee can change a small organisation overnight," he said.

The research, using data collected by the Charities Aid Foundation, also shows that small charities' incomes fell in the recession of the 1990s, when large charities' incomes rose by less.

Also ...

The Centre for Social Justice is to build a website giving people details of local charities they can support.

Iain Duncan Smith, who founded the centre, said people often wanted to support local causes but didn't know how to go about it. The centre has recruited 200 charities for its Poverty Fighters' Alliance, which aims to tackle social breakdown. Duncan Smith said it would create the site when the figure had reached 500.

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