Fundraising could slump back to 2013 levels, researchers warn

Fundraising income may fall back to levels of six to seven years ago due to Covid-19, academics have warned.

The Chartered Institute of Fundraising (IoF) commissioned research paper Reframing the Ask: trends which will shape giving and fundraising post-COVID-19 looks at the outlook for fundraising.

This includes analysing household giving and spending, trends in fundraising income and legacies as well as foundation and corporate giving.

It looked at Treasury economic forecasts that show a sharp fall in GDP this year, following a rise into 2021 but from a “lower base, and followed by period of flattish growth".

“If fundraising income followed this pattern, it could fall back to 2014/15 or 2013/14 income levels, or lower,” the research adds.

Small charities are set to be hit hardest according to these economic forecasts as they “depend more heavily on donations from the public”, says the research.

It concludes: “It could take the charity fundraising sector longer than the economy to recover, because of the capacity risks in the large number of small charities, or if households fail to prioritise donating.”

The report has been written by Cass Business School visiting professor Cathy Pharoah and University of Dundee honorary research fellow Tom McKenzie.

In a IoF blog they warn charities that “fundraising decisions on the ground are fraught with unknowns – around recession, employment, distancing rules and public behaviour”.

“In a context of such unpredictability, planning has to be open-minded, iterative and adaptable,” they add.

However, they offer comfort to the sector based on an increase in average household giving over the last two decades, which is seven times the rise in general household spending over that period.

This suggests that there has been “successful donor engagement by fundraisers” in recent years.

“It could hopefully provide a platform for the strong post-COVID-19 charity fundraising that will be needed as the economy begins to struggle,” add Pharoah and McKenzie.

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