Charities face a financially challenging year ahead as a result of Brexit uncertainty, tight government budgets and a slow economy, the NCVO has warned.

According to the membership body’s annual report, The Road Ahead, charities are cautioned to be aware that a weak pound, high inflation and declining investment in the UK leave the economy and many beneficiaries ‘fragile’.

The NCVO’s research highlights that despite record jobs growth, the average pay packet remains £11 a week lower in real terms than before the financial crisis, while those who rely on benefits will also continue to feel their disposable income ‘squeezed’ over the coming year.

This could in turn have ‘bleak’ consequences for some beneficiaries, and charities delivering services such as debt relief, housing support and foodbanks are likely to see demand continue, the report claims.

“The uncertainty around Brexit makes it difficult to accurately predict where the UK economy will go over the coming year, although most experts remain downbeat about the short-term prospects,” NCVO senior finance analyst, Paul Winyard said.

“While government finances have somewhat improved since last year’s Road Ahead, limited growth and existing spending commitments made by government mean pressure on voluntary sector funding and support is likely to continue for the foreseeable future,” he added.

NCVO director of public policy and volunteering, Karl Wilding added: “I hope trustees and senior managers will use Road Ahead as a tool to reflect on how the wider environment will impact their own organisations, so they can feel prepared for what 2019 might bring.”

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