More charities with low reserves are applying for grants, foundations say

Association of Charitable Foundations launches event to help members identify applicants that are financially at risk

David Emerson, chief executive of Association of Charitable Foundations
David Emerson, chief executive of Association of Charitable Foundations

Charitable foundations are receiving more applications from charities with low reserves, according to foundations.

Linda Kelly, chief executive of the Lloyds TSB Foundation for England and Wales, told Third Sector that in the first half of this year it had received a similar number of applications as in the same period last year, but there had been a change in the financial stability of the organisations applying.

"We’ve seen more people with no income apply, which is very unusual," she said. "And there are more with less than six months’ reserves – often only one, two or three months."

The consistency in the number of applications might be because organisations did not have the resources to make as many applications as they wanted to, she said.

Sam Grimmett, grants officer at the Clothworkers’ Foundation, said an increasing number of organisations were applying to the foundation with no reserves and a lower income than before, and that most of the applicants were running on a deficit.

"We’ve accepted we can’t have the same high standards as before," she said. "Previously, we did not fund organisations running on a deficit, but we do consider it now."

The quality of applications had deteriorated, she said. "The applications might now be written by volunteers, who don’t know the right language to use or how to present the organisation in the right way," she said.

David Emerson, chief executive of Association of Charitable Foundations, said it had recently been called on by members to launch a new event that would advise them on how to identify charities that may be financially at risk, and the take-up had been very high.

"It isn’t the number of applications that now concerns us, it’s the nature of them," he said.

Charities had been pressing foundations much harder for money, he said."There are more people who are really needing the grant rather than wanting the grant," he said.

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