Recession led to ‘huge losses’ for Irish non-profit sector

The Irish non-profit sector experienced “huge losses” during the economic downturn, as average funding was slashed by 35 to 40 per cent, and staffing fell by almost a third, according to a new report.

The National Guide to Pay and Benefits in Community, Voluntary and Charitable Organisations, was published on Thursday and features 11 case studies. It was carried out by Anne Coughlan and commissioned by the Community Foundation for Ireland.

It explores the remuneration challenges facing non-profit organisations, along with the ways the sector has addressed those challenges, in what it describes as “post-recessionary times”.

Interviews were conducted in 11 organisations, which were chosen randomly to represent different size organisations, different activities and different locations.

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Ms Coughlan concluded that during the recession the Irish non-profit sector experienced “huge losses” in terms of funding and staffing. The average funding loss was 35 to 40 per cent, while staffing dropped 31 per cent.

Experiencing difficulty

Ms Coughlan pointed to the economy nearing full employment as having led to “increased competition for labour”.

This has left the community and voluntary sector “experiencing difficulty” in terms of holding on to staff in a sector that traditionally pays less than the private and public sectors, and relies heavily on employee commitment.

“There has been much anecdotal evidence that, while some organisations are getting back on track, others are continuing to experience problems and challenges,” the report said.

All the organisations in the study had pay and/or pay increments frozen during recessionary times.

With regard to pay increases from 2015 onwards, organisations responded in different ways, with increases ranging from 0 per cent in four of the participating organisations to 25 per cent over four years, albeit from a very low base scale, in another.

Three organisations had given two increases since the recession, two had given three increases, and one had given one increase in the last three to four years.

The case studies highlighted a number of “ongoing challenges” within the sector, some of which have been known for some time and were referred to as far back as the 2000 government white paper on the sector.

The ongoing challenges include uncertain and insufficient funding, including complexity of funding arrangements and the absence of funding for the running of the organisation.

Transparency

The report also points to the need for staff in human resources, advice and representation. Mention is also made of staff welfare and pensions.

Community Foundation for Ireland chief executive Tina Roche said it was important for donors and the public to see transparency in the sector.

“We felt it was very important to continue our work regarding pay, benefits and remuneration in the non-profit sector to highlight the differences and discrepancies within the community and voluntary sector compared with other industries,” she said.

“It is extremely important for the public and especially the donors we work with that the community and voluntary sector is open and honest and adheres to the highest standard of governance.

“Trust in the sector has taken a hit in recent years and it is only through open and transparent reports like this that we can begin to build upon that trust once again.”