Small and medium-sized charities reported a combined deficit of more than £300m in 2011 compared with a surplus of £325m in 2007, according to new figures.
Data compiled by the Charities Aid Foundation based on charities’ annual returns to the Charity Commission show that those with incomes of less than £1m a year had a combined income of £8.4bn in 2011 and an expenditure of £8.7bn.
In 2007, the combined income of charities in the same income bracket was £6.9bn against an expenditure of £6.6bn.
Small and medium-sized charities represent more than 130,000 of Britain’s 162,000 registered charities, CAF said.
The overall income for charities of all sizes, which CAF said was not comprehensive because it does not take into account those that failed to file their accounts in time, was £55.9bn in 2011, up from £43.3bn in 2007. Expenditure was £53.9bn in 2011 and was £40.4bn in 2007.
John Low, chief executive of CAF, said the figures were "a great cause for concern". He said many small charities were facing falling incomes but increasing demands on their services.
"The vast majority of our charities are relatively small and do amazing work," he said. "But many are having to dip into their reserves to keep going, cut back on the work they do and lay off staff if they employ any."
He called on the government and the public to support the Back Britain’s Charities campaign, which was launched earlier this month by CAF and the National Council for Voluntary Organisations.
The campaign urges people to support good causes through regular giving and calls on the government to modernise and promote Gift Aid and payroll giving so donations go further.
