Charity sector slashed spending by £2.2bn last year amid plummeting income

Figures released by the Charity Commission show that spending in the voluntary sector fell by £2.2bn less over the last year.

While in 2020/21 the total spending by charities on the register was £82.3bn, this fell to £80.1bn in 2021/22.

The figures suggest that dwindling income is a likely factor. Over the same period income in the charity sector fell from £84.1bn to £83.8bn, a drop of £300m.

Another factor in the decline is that there are fewer charities on the register, with many closing or merging with similar organisations amid a fall in income caused by the postponement of in person fundraising events and retail amid the Covid pandemic.

Between 2020/21 and 2021/22 the number of charities on the register dipped from by 833 from 169,862 to 169,029.

Charities to recently announce they are to close this year include Raleigh International Trust, which became insolvent following funding cuts and Covid related delays to its programmes.

The number of charities removed from the register has also increased, from 3,316 in 2020/21 to the removal of 5,252 in 2021/22.

Among charities removed from the register is Support for Heroes, which has been wound up by the regulator after it emerged that donations were siphoned off to a private firm linked to one of its trustees.

The figures have been revealed in the regulator’s latest annual report. This also shows it has halved its spending on consultants, from £1.2m last year to £603,000 this year.

Meanwhile spending on IT and telephone services has increased from £2.8m last year to £3.3m this year.

Fall in statutory inquiries

There has been a dip in the number of statutory inquires, its most serious form of regulatory action, which have been completed as well as those that have been opened over the year.

In 2021/22 it concluded 45 statutory inquires, compared to 64 the previous year.

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