A third of charities have no reserves, according to NCVO

Research from umbrella body also finds that median reserves level for charities that get state funding is a month's expenditure

One in three charities has no reserves to draw on, according to figures published today by the NCVO.

The research also shows that the median reserves level for charities that receive state funding is only one month’s expenditure.

The figures have raised fears that drastic cuts in state grants and contracts could result in the closure of many organisations.

"These figures show how vulnerable many community and voluntary organisations will be in the testing and unpredictable times ahead," said Sir Stuart Etherington, chief executive of the NCVO.

"This really demonstrates the need for public sector funders to work with voluntary and community organisations where cuts are necessary, to make sure they are properly planned and implemented."

The research on assets and reserves estimates the sector’s level of free reserves was £46bn in 2007/08.

There is wide variation in reserve levels for different types of voluntary organisation: housing associations typically have almost 20 months’ of spending in reserve, but playgroups and nurseries have only 1.4 months.

John Plummer recommends

NCVO

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