This report, published by the Charity Commission on 28 October 2021, presents the findings of independent research into the impact of COVID-19 on charities.
As a regulator, they needed concrete data to help them understand how the pandemic has shaped charities so far, and, crucially, to gain a picture of the risks that may lie ahead.
Whilst the charity sector is immensely diverse, the research does allow them to draw a few clear conclusions.
Nearly all charities were impacted by the pandemic – over 90% told them that they have experienced some negative impact from Covid-19, whether on their service delivery, finances, staff, or indeed on staff morale, resulting from the months of frustration and uncertainty.
The majority (60%) saw a loss of income, and a third (32%) said they experienced a shortage of volunteers. However, they haven’t seen a significant number of charities fold since March 2021.
Last year, 97 charities reported to them that they were insolvent, as part of their annual return to the Commission. That is up by a third on the previous year, but still a relatively small number when compared to the 170,000 charities on the register. Overall, the number of charities closing did not vary significantly compared to the previous year.
Of the 91% who were affected by the pandemic, nearly half (45%) say they took some action to adapt their services to restrictions caused by the pandemic. Some changed the way they delivered services, moving them online, refocusing on core projects, taking difficult decisions to cut staffing or spend on things like research. Around 40% say they dipped into their reserves.
One in four charities with incomes of less than £10k paused their activities completely during the first lockdown. It’s also clear that government support, including the furlough scheme, helped bolster many charities’ resilience.
For the future, over half (62%) of those asked anticipate some level of threat to their charity’s financial viability in the next 12 months. But only 1% foresee that threat being critical to the charity’s survival.
The picture is not all gloomy. Nearly half of those asked (49%) say their staff and/ or volunteers have learnt to make better use of digital technology over the past year or so, and a significant minority (18%) say communication between trustees has improved since the beginning of the pandemic
You can read more about the findings in their blog here.
And in the survey report here.