As households tighten their belts, charities feel the pressure

Every year, Ireland’s charity sector distributes billions of euro in aid to the most vulnerable in society. We have a reputation of being one of the most generous countries in the world, per capita. However, as growing numbers of people are depending on charities to help them make ends meet due to the cost -of-living crisis, and as households across the country are starting to tighten belts and watch their spending, charities are in danger of coming under pressure from both sides with donations falling at the same time as demands increase.

“In Ireland, our ‘hybrid model’ of providing public services – where the State funds charities to offer certain essential services and supports – is, like those it is supposed to provide for, suffering from a chronic lack of care,” says Ivan Cooper, chief executive of The Wheel, Ireland’s national association of charities, community groups and social enterprises.

An independent review group, appointed by the Government to examine the role of voluntary organisations in publicly funded health and personal social services, found that these organisations deliver approximately one-quarter of publicly funded acute hospital care and about two-thirds of disability services, Cooper says. These organisations collectively account for more than one-quarter of the total health budget each year.

“Despite their indispensable role, however, community and voluntary service providers are grappling with issues like rising operating costs and a staffing crisis that is blocking access to and affecting the quality of vital services. According to the Charities Regulator, 41 per cent of charities had to use some of their reserves in the last few years, and 3 per cent used all of their reserves,” Cooper says.

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The housing crisis and the cost-of-living crisis are closely intertwined with the challenge of homelessness. Focus Ireland frontline staff have witnessed a surge in demand for their assistance, driven by individuals and families who have been displaced due to the difficulty of securing affordable housing or who face financial instability as a result of the cost-of-living crisis, says Amy Carr, director of fundraising and marketing at Focus Ireland.

“Last year, approximately 16,000 engaged with our services, an increase of 30 per cent compared to 2021 (12,300 people). After several years during which the total number of people needing our support remained around 12,000, the increase to 16,000 people in 2022 is striking,” Carr says.

The latest figures from Focus Ireland, as of September 2023, showed a total of 12,827 people homeless, of which 3,904 are children. “This is an increase of 136 compared to the previous month and an annual increase of 17 per cent compared to September 2022,” says Carr.

Despite challenging times, she says, Irish people are “incredibly” charitable. “In our experience, regardless of what is happening in the economy, they want to support people when they need it the most,” Carr says. “This is especially true at Christmas when people really appreciate the value of having a safe and secure home. Many people still give what they can, even if it is not as much as usual, and to Focus Ireland every donation makes a difference to people who need our support.”

However, Carr does not have the same kind words for those in power. “The Government did not deliver on its promise of a ‘children’s budget’ as almost 4,000 children who are homeless were overlooked,” she says.

To strengthen the charity’s base, so they can continue their critical work, they have looked to diversify their income streams, not becoming too reliant on any one source.

“One of the areas that we have grown over the last 10 years is our corporate partnership and philanthropy area, which now accounts for 40 per cent of our income,” she says.

“We recently developed a five-year campaign called A Place Called Home which aims to encourage companies and philanthropists to support our vision to end homelessness by preventing 3,000 people from becoming homeless and moving 5,000 people on from homelessness. With nearly 75 per cent pledged already I think it demonstrates how deeply people care about ending homelessness.”

Another major charity, Barnardos, is facing similar pressures to keep up with rising demand.

“Barnardos needs to raise almost €10 million each year to provide services to over 20,000 children and families, with demand for our services increasing each year,” says Seán Bergin, the charities’ national fundraising manager who has been with Barnardos for 12 years.

Similar to Focus Ireland, they know they cannot rely solely on the kind-hearted individual donors. “Having a diverse portfolio of giving streams across individual, corporate giving, trusts and foundations (philanthropy) and community is the only way to ensure multiannual funding that can be planned and budgeted for,” says Bergin.

Charities are having to get creative to cope and Barnardos has began to look further afield. “There is a great demand in Ireland for this small pool of wealth and generosity. Working with partners like the Community Foundation for Ireland, The Ireland Funds has opened a door to bigger potential giving, from across the world.”

Nevertheless, people continue to give what they can when they can. “Most people today are affected in some way by the rising cost of living. Barnardos has noticed a decline in support from donors who have given consistently for several years. This is certainly indicative of the struggles nearly every family faces today to cover their own expenses. Barnardos is so grateful to each person, company and foundation who gives to us each year – even when it can be a struggle.”