Stalling donations masked by rising legacy income, Third Sector study finds

Total giving to the top 10 charities has grown by 2.4 per cent in three years, but this has mostly been supported by an increase in legacy income of 13.5 per cent

Donations to the top 10 fundraising charities appear to have stalled over the past three years, but this has been masked by a growth in legacy income, analysis by Third Sector has found.

Total giving to the top 10 charities by fundraising income has grown by 2.4 per cent over the past three years, from £1.76bn to £1.8bn.

But Third Sector found this growth was mostly supported by a rise in the value of gifts left to charities in wills, while for many of the biggest fundraising charities other types of donations have fallen.

Between 2015/16 – or the nearest year for which the charities’ accounts were available – and 2017/18, legacy income rose by 13.5 per cent, from £621.2m to £705.3m.

Meanwhile, income from other kinds of donations, which was £1.14bn in 2015/16, fell to £1.1bn in 2016/17. It climbed slightly in 2017/18, but only by £2m, and there was still a 3.6 per cent drop across the three years.

The figures form the basis for an analysis article in the latest edition of Third Sector magazine, out now, which also looks at data from other bellwether charities, including Comic Relief.

In the article, Meg Abdy, development director of the legacy consortium Legacy Foresight, said the rise in legacy income was due to rising house prices because, rather than leaving fixed amounts to charity, many people were leaving portions of the value of their estates, including houses.

But she warned that Brexit might have a negative impact on legacies.

"I don’t think charities can rely on legacy income to bolster voluntary income the way it has in the past three or four years," she said.

Nick Pride, fundraising strategy director at the creative agency WPN Chameleon and former deputy head of fundraising at Oxfam, said the sector needed to respond to the warning signs before it was too late.

"I think most people are reaching the conclusion that we can’t carry on as we have been," he said.

"We’ll reach the point at which the money will continue to decline and we won’t have a better answer. We have to change."

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