Fundraising income was better than expected in first part of the recession

Charity Market Monitor report shows income of 500 largest charities fell by only 1.1 per cent.

Which methods worked best?
Which methods worked best?

The fundraising performance of the UK's 500 biggest charities was significantly better than expected in the early part of the recession, according to figures released today.

The Charity Market Monitor survey shows that their combined income in the financial year 2008/09 fell by £64m, a drop of 1.1 per cent. A year ago, the same publication predicted that the fall could be as high as £185m, or 3.5 per cent.

"The public has not deserted charities," said Professor Cathy Pharoah of Cass Business School, the author of the report. "Fundraising income has fallen since the start of the recession, but not as sharply as it could have done."

She said she thought it likely that the fundraising income of the biggest charities, which totalled just under £6bn in 2008/09, would continue to hold its own in the coming year.

But she warned that the sector's statutory income, which remained relatively constant in 2008/09 compared with previous years, could drop significantly in future as a result of public sector spending cuts.

Charity Market Monitor is based on an analysis of the charities' published accounts for the year. It shows the sector's total income, including statutory and other earned income, fell by £104m, a fall of 0.9 per cent.

It also shows that their spending rose by 2.7 per cent. Pharoah said this increase was due partly to higher demand for their services, and partly to investment in generating funds, which rose by 4.3 per cent on average. But 'other expenditure' fell by almost 16 per cent.

"A lot of charities changed their fundraising strategies half way through their financial year to cope with the recession, and this often involved spending more on fundraising," she said. "I'm not sure whether this policy will be sustainable in the next year."

The type of fundraising that showed the biggest increase was gifts in kind, which included several very large donations from pharmaceutical companies to health charities.

The report also shows that the value of legacy income fell by 3.9 per cent to £1.4bn. Pharoah said this was because of the fall in the value of assets and investments when the economy crashed in 2008.

Income from fundraising events rose by 6.4 per cent to £301m, and charity shop donations were worth £345m, an increase of 4.8 per cent.

FACT FILE - THE BIGGEST OF THE BIG

- The top five charities by fundraising income were Cancer Research UK, Oxfam, the British Heart Foundation, the RNLI and the NSPCC.

- The next five were Macmillan Cancer Support, the Salvation Army, the British Red Cross, Save the Children and the RSPCA.

- Cancer Research UK's income rose by more than £14m to £368m.

- Oxfam saw its income fall by £18m to £189m.

- Health causes continued to attract the most income - a total of £1.4bn.

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