The March UK budget left us with a tentative and rare sense of hope. Along with other charity sector partners, UKCF had been lobbying hard for additional support for struggling charities, and therefore welcomed the news that the UK government pledged to provide £100 million over the next year, the details of which have just been announced. Additionally, the Department for Culture, Media and Sport (DCMS) plans open a consultation very soon on distributing the next tranche of dormant assets funding.

Ben Robinson

Amidst the cost-of-living crisis, charities and non-profit organisations have marched on, despite three years of staff burnout, drained financial reserves, and a steep decline in volunteers.  Indeed, small charities are grappling with surging levels of need, as outlined in this open letter that explains how they are “exhausted [and] burnt out” with many having to close or reduce their services.

The levels of need today are as prevalent as in the winter months, with low-income households being pushed further into negative budgets and a steep rise in people seeking charitable help for the first time.  By January this year, community foundations had collectively raised over £12.6 million in local donations to help small charities and community services.  Emergency funding has continued to be distributed through local voluntary networks that are supporting households in financial hardship.

Frontline charities need help now, but they also need it in the right way.  During the recovery phase of our Covid-19 funding, UKCF published a learning report reflecting upon the distribution of £76 million by its members.  These lessons seem more relevant than ever.

The first lesson: Act quickly.

Delays in emergency funding can have profound consequences for the urgent services needed to help in a crisis.  Streamline the criteria and application process, and make sure that charities and community groups have the support they need to access funding as quickly as possible.  As the seriousness of the pandemic became apparent, community foundations were on the phone to groups before the first national lockdown was even announced to understand needs and allocate grants.

Second: Devolve as much control as possible and unrestrict grants where you can.

Small, local charities know their communities better than anyone else.  It is impossible to direct an effective crisis response from the centre.  You will waste valuable time collecting out-of-date information on need and divert the effort and resources of frontline groups that would prefer to focus on supporting people.

It is crucial that charities have the power to respond to need as it develops, rather than being tied to specific requirements that don’t meet the community’s priorities.  What may have been right four weeks ago may not be what is needed now.  By giving communities the power to decide how best to use their localised funding, we have seen incredible results at UKCF.

Third: Small grants can make a substantial difference.

Often, small charities are overlooked when it comes to funding, especially when there is an understandable desire to get money out quickly. Large grants often go to big charities with larger teams that promise to spend money in a way that national funders can understand and measure. Yet, smaller grants require a less complex application process, can be distributed more quickly and allow local charities to better plan and implement their services.  This in turn enables funders to understand impact in a precise, more localised way.

Fourth: Don’t wait for a crisis – invest in ‘normal’ times.

Charities don’t simply switch their lights on at the start of a crisis and close up shop when it’s quiet again.  As Citizens Advice data shows, the demand for support is continuing to peak at record levels. By building and retaining strong relationships with communities and their local services, we can ensure they already have the resources, capacity and resilience in place before a crisis hits.

While a longer-term focus will help prepare for future crises, today’s short-term shocks are threatening the existence of otherwise strong and highly effective charities. The Government’s £100 million won’t overcome all the challenges in the voluntary sector, but learning lessons from the past could pave the way to ensure these services aren’t lost forever.

As for the Government’s intentions for its dormant assets, having revitalised millions of pounds of dormant trusts in the community foundation network, we have seen the difference that re-energised funds can make to organisations and communities all over the UK.  The fundamental aims of the community wealth funds should be ensuring they are invested equally throughout the nation with an opportunity to grow as an ongoing source of impactful support, and guaranteeing the power is held in the hands of communities. Community foundation endowments are a good example of how donors can contribute to the asset base of local communities and support the future of sustainable funding to the local organisations that communities rely on.

Community-focused charities, small and large, are feeling the bite of the cost of living and will do so for years to come. The time to invest in our communities, and invest effectively, is now.

Ben Robinson is Deputy CEO and Director of Strategy at UK Community Foundations (UKCF)