With inflation hitting a record high, in addition to rising fuel prices, the cost of living has increased dramatically. As a result, the impact on charities is expected to be significant.

As Pro Bono Economics says, it is “inevitable that organisations within the sector will step up – they always do” but it won’t be an easy task for a sector already heavily impacted by Covid-19 and likely feeling the rise of prices and inflation too.

Below, we’ve taken a look at some of the things charities might be able to do to help deal with the crisis, split into what charities can do for employees, and wider measures the whole charity can look at.

Employee measures

Support staff

Historically, the charity sector has struggled to keep up with private-sector wages and therefore staff may be struggling with the cost of living themselves.
Some charities, such as Community Integrated Care, have increased the pay of its frontline support workers for the second time in six months because of the rise in inflation, but this isn’t possible for all charities.

Flexible working

Flexible working could be a simple solution to help with costs and is one charities have already proven they can do. It would cut down on commuting costs, and perhaps even allow the charity to downsize office space – saving more money.

Commuting loans can also help employees spread the cost of season tickets for rail, bus or tram travel. Employees buy an annual pass instead of a monthly or weekly pass, thus reducing the cost, then paying monthly through the commuting loan all interest-free. Most train lines now even offer a flexi season ticket with reduced price travel for eight days of travel within 28 days.

Financial wellbeing

Financial wellbeing benefits could also help employees with their finances in both the short and long term. Lots of employee benefits help employees save money in the short to medium term, through salary sacrifice or exclusive discounts, for example.

What’s equally as important is education around finances and helping employees to save for the long term, budget, invest and learn how to make their money work for them. Try talking to your bank, investment firm or even a financial charity to see if they might be able to offer a talk to employees and give advice on these subjects.

Employee benefits

The right employee benefits package is invaluable to both the employer and employees. For the employer, these benefits can help support employees and reduce absenteeism, improve productivity and employee engagement by helping support employee wellbeing.

For employees, while employee benefits won’t provide the full answer to the cost-of-living crisis, benefits can at least give employees options, helping to reduce costs and still prioritise health without worrying about the cost.

Health and wellbeing employee benefits, for example, like the Health Cash Plan, PMI, Eyecare, Dental Cover and even the Gym Scheme are all designed to help employees save money on healthcare.

Charity measures

Funding for charities has been difficult in recent years, and it’s not looking as though it will be getting much easier. With rising costs, charities will be facing the reality that they need to look at their own finances, below are some tips that could help.

Budget cutting

When funding gets tough, it’s inevitable that budgets will be cut, but the first port of call shouldn’t be cutting staff. Look at what you no longer need. When did you last review your most expensive contracts to see if you're still getting a good deal and if you still need everything you're paying for? As mentioned previously, office accommodation may be able to be downsized or even scrapped if staff are permanently working from home.

Partner up

Seek out and act on collaborative opportunities. A merger is not without risk, can be expensive and the benefits can take time to deliver. But, there is substantial overlap and duplication between many charities and the financial rewards can be huge.

Claim what you’re entitled to

Charities often lose out on free cash, simply because they don’t claim it. Unclaimed Gift Aid, for example, loses around £600m a year and is an easy way for charities to claw back expenses.

The Apprenticeship Levy is another heavily unclaimed source of funding, and can be used to train and hire new staff at minimal, or no, expense.

It may also be worth looking into the Kickstart scheme, which offers government funding for out-of-work young people for six-month work placements, for at least 25 hours a week, to help them gain experience, skills and confidence. The scheme is designed to be a stepping stone to further employment.

Exploit technology

New technologies are produced all the time; innovations that can provide much cheaper solutions to problems charities are facing. Charity Digital is a great place to start when looking into new technologies and it offers donated and discounted software to charities.

Reorganising IT systems and standardising hardware and software can potentially both save money and more effective, too. For example, centralising printing can save money, or, if people are individually buying branded ink cartridges, switch to bulk purchasing unbranded ones.

For more ideas on how to save money, Charity Excellence has an excellent blog that has many ideas on how to reduce costs.