Running out of charity

NEWS FOCUS: FOR THE past year medical charities have been struggling to cope with the fierce economic downturn, but the extent…

NEWS FOCUS: FOR THE past year medical charities have been struggling to cope with the fierce economic downturn, but the extent to which they have been affected is only now becoming apparent, writes RONAN McGREEVY

The Wheel, the national support and representative body for community, voluntary and charitable organisations, has been conducting a national survey of charities over the past fortnight.

It has found that three-quarters have recorded a fall in revenue and half have seen their revenues reduced by up to 10 per cent while a third have experienced levels higher than that.

A majority (60 per cent) also feel that things are not going to get any better over the next six months.

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The effects of Government cutbacks are being felt acutely by charitable organisations that have become, in many cases, critically dependent on statutory funding for their income.

Two-thirds have experienced a decline in such funding. Nearly half (44 per cent) of all charities receive 80 per cent or more of their income from Government sources and the same amount do no public fundraising.

The survey was carried out among 173 charitable organisations across the State and is the most comprehensive account to date of the impact that the recession is having on them. The Wheel chief executive Deirdre Garvey said the extent to which many charities were dependent on State funding was surprising and reflected that the State has been subcontracting a lot of youth and disabilities services to the voluntary sector.

“These charities are facing cuts in statutory funding of up to 20 per cent,” she said. “The lesson for charities is that they need to have more diverse economic streams.

“We are saying to charities that the situation will get better but it is never going to be as good again. They need to think strategically about how they are going to deal with the changed reality.

“We’ve been saying to charities, who do very valuable work in communities, that they need to look to those communities to keep them working. The Government does not have the money.”

Tim O’Dea, head of fundraising at The Irish Hospice Foundation, said it was expecting that corporate donations, which make up a substantial part of its funding, would be down by 40 per cent this year.

The foundation had a combined income of €4.5 million last year.

In 2008 it was chosen as the charity of the year by six different companies. This year just two have done that.

In 2008, it was Royal Bank of Scotland Ireland’s charity of the year and the loss of that status will cost the Hospice Foundation €225,000.

“My biggest concern is for next year, not this year, because this year’s funding was put in place before things turned,” Mr O’Dea said.

“It is very quiet. We would expect to be working on an ongoing basis with more than two larger companies. There is very little business out there that we are aware of and we would like to think that we would be in the hunt for many of the charity-of-the-year programmes.

“We understand that it is difficult for companies to support charities when they are struggling themselves and laying off staff.”

Mr O’Dea said that although there had been a fall-off in corporate donations, individual donations had remained steady and a new fundraiser, which will see 110 people cycling from Dublin to Paris, will raise at least €350,000.

“That will cushion losses in other areas. Individual-based funding is holding up well: individuals do seem to be recognising that times are tough for charities.”

Ruth O’Dea, the director of fundraising and marketing at the children’s charity Barnados, said raising money had become “more and more difficult”.

“Less people are giving and they are giving less money,” she said. “We completely understand that our donors, who have been supporting us for a number of years, are in situations where they are losing their own jobs.”

Barnados is to bring forward its autumn fundraising plan. It maintains that most people who give to charity give when they are asked rather than volunteering payments.

“People don’t spontaneously wake up on Monday mornings and decide to give money to organisations. You do have to go out there and ask them,” she said.

Barnados fundraised €5.1 million last year and a similar amount came from philanthropic sources, particularly rich individuals.

“There is a reduced number of people who have the capacity to give at the same level. We are definitely still getting the support, but it is the same situation with fewer people and smaller amounts,” she said.

The Irish Heart Foundation (IHF) is 93 per cent funded by public donations and it estimates that its funding will be down by 15 per cent this year.

IHF chief executive Michael O’Shea said the organisation was monitoring its returns very closely. “It may be necessary to curtail some services but we still hope to provide a fairly comprehensive service to support people with heart disease and stroke.

“We will have a number of fundraising events later this year when we will be calling on the generosity of the public once again.”

Multiple Sclerosis Ireland chief executive Anne Winslow said its income was down 15 per cent last year and they had faced a 3 per cent funding cut from the Health Service Executive (HSE).

“It may have serious implications for us next year, but we are working as hard as we can to cut back on things that do not impact directly on services. We are looking for more competitive prices on catering and printing and anything else we can find.”

Ms Garvey said she was impressed at how charities had sought to minimise the effect on the services they provide.

Only 1.3 per cent of charities said they would be making redundancies over the next six months and half have no plans to do so over the foreseeable future.

“Charities need to think like commercial businesses, cutting out costs and the fat and looking at more creative ways of delivering their programmes. If that means mergers and collaborations, so be it,” she said.