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We are a leading charity, working at the centre of the giving world. We help donors to give more impactfully and charities to build their resilience so they can do more of their life-changing work.

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Inside Giving

Charity Resilience Index

Charities reveal the challenges they are currently facing.

Demand for charity services continues to rise

As part of our ongoing research into how charities are experiencing and responding to sustained economic and social pressures, we surveyed 784 charity leaders in May and June 2024. 

Key findings


  • Demand is up significantly across the sector, especially for poverty relief charities, human rights/equality and diversity charities, and charities helping people in need.
  • Charity leaders say there is less money to go around amid increased competition for funding, and nearly a third are slimming down their workforce
  • The majority (79%) agreed that charities should have a strong political voice on issues that concern them.  

Ashling Cashmore, Head of Impact and Advisory at the Charities Aid Foundation, said:

“While the worst effects of inflation may have subsided, charities are still having to do much more with less. They are dealing with ever-increasing demand which is only expected to rise as we head into winter - yet their income is not keeping up and there is less funding to go around.

“We need to work together to create a stable environment for our hard-working charities and those they support. The new Government has said it wants to reset its relationship with civil society and an important next step would be to introduce a national strategy for philanthropy and charitable giving to make sure charities receive the support they desperately need.”

Demand for services is up significantly across the sector 

Significantly more charities say that demand for their services has increased ‘a lot’ in the last 12 months. Over half (54%) now say this the case, up from 46% in 2023 when we surveyed a similar sample of charities. Charities which are most likely to say that demand has increased ‘a lot’ are poverty relief charities (67%), human rights/equality and diversity charities (66%), and charities helping those in need (55%). 

In total, 86% of charities now say that demand has increased, and almost all (88%) expect that demand to continue to rise. Meeting demand was also reported as one of the top three challenges facing charity leaders (50%). 

Among charities who anticipate a continued rise in demand, just over a quarter (28%) are not confident they can meet that future demand. This proportion is even higher for charities that say they don’t have diverse (39%) or predictable (40%) funding.

Demand_graphic

“The new clients referrals have gone up substantially - there was something like a 40% increase last year on the year before and I think we’ll probably increase about 5-10% this year on the previous year. We are increasing in the complexity of the clients who come to see us.”

Chief Executive of a small sexual violence charity in the Southeast

“We’re not even meeting the demand that exists now and we’ve got 70 people on our waiting list for counselling. For me, being fit for the future means being able to meet that need and I know that we’re not able to do that.”

Chief Executive of a human rights charity in the North of England

Charity leaders say there is less money to go around, and competition for funding is increasing.

Among the top challenges for charities, increased competition for funding and donations was the most commonly cited (50%), followed by concerns around financial sustainability (e.g. less public sector funding, fewer donations, etc.) (45%).

Nearly a third (30%) of charities have either already slimmed down their workforce, or plan to do so in the next 12 months, while just under one in five (18%) charities are not confident that their financial future is secure enough that they will be around in five years’ time. 

These results echo recent announcements from funders that they intend to pause new grant applications from charities because demand had reached ‘unsustainable levels’.

Challenges_graphic

“One thing that’s happened with Youth Services is that across the country nearly all of the statutory funding has been hollowed out. We get a grant from our local authority for our group activities, but it’s only about 25% of our budget so we still have to find the other 75%. That is our biggest challenge compared to our Youth Employment Programme, which is almost fully funded. But the unrestricted bit, nobody wants to fund.”


Chief Executive of a medium-sized education charity in the Southeast 

“We are already stretching to meet demand. And we won’t be able to do any more than that within our financial constraints. A year ago I had four support workers, and now I’ve only got two. The money that my council was giving us is now being kept by the local authority.”

Chief Executive of a medium-sized refugee charity in the Northeast

Charity leaders spend most of their time firefighting, and a third think the sector is unhealthy.

While around half (53%) of charity leaders are optimistic for the future of the sector, nearly a third (31%) think the sector is unhealthy.
On average, charity leaders are spending at least 75% of their time solving day-to-day problems to keep their charity operating. This is particularly true for charities with annual incomes under £1 million.

In order for the sector to be healthier, charity leaders say they need better overall funding (55%), and improved statutory funding (32%). Charity leaders also believe that raising awareness of charities and improving reputations is critical to the future health of the sector (17%).

Sector health_graphic

“We’ve already seen a lot of mergers, a lot of charities winding down and we are thinking about it quite seriously as well.”

Chief Executive of a medium-sized refugee charity in the Northeast

Government efforts to include more charity voices are likely to be met with enthusiasm from the sector and the public

Prior to the General Election, only 5% of charity leaders said they thought government departments / civil servants understand what it’s like to be a charity. However, a recent analysis shows that 53% of current MPs, including those newly elected, have a background in the charity sector themselves.*

With most (79%) charity leaders agreeing that charities should have a strong political voice on issues that concern them, a majority (62%) would like to do more work to develop policy recommendations but find it hard to get the necessary funding. 

Separate CAF polling of the public indicates that people would be broadly supportive of charities having a stronger voice in policy decisions. The vast majority think it’s important for government, businesses, charities and philanthropists to work together to deliver projects nationally (84%) and locally (85%), and only a quarter (27%) of people can imagine withdrawing support from a charity because it spoke out on an issue related to their mission, even if they disagreed with it.

As an important source of data and insight and a critical delivery partner, it’s encouraging that the new Government has said it wishes to reset its relationship with civil society. 

*Free Resource: MPs and their experience in the charity sector | Pro Bono Economics 

Policy_graphic

About the research

Data collection took place between 14th May and 16th June 2024. The sample included CAF Bank customers and members of Acevo, Acosvo, and Co3. The survey was conducted online and the sample was self-selecting. A total of 784 charity leaders answered the questions used in this analysis. Some questions were answered by fewer respondents, or a sub-sections of respondent, and this is noted where applicable.

Key findings from December 2023

Charities are at maximum capacity and many are being forced to make difficult decisions on who they can help

Half of charities (50%) surveyed say they are at full capacity for their services. This includes over a third (35%) of charities surveyed who say they cannot help anyone else, and one in seven (15%) who say they have been forced to turn people away.

Of the 323 charities we spoke to who are at capacity, half (51%) have had to make judgements to prioritise those most in need and two-fifths (41%) are signposting people to other organisations. Around three in ten (28%) of these charities have created a waiting list and one in 10 (9%) have stopped taking referrals altogether. 

Resources are tightening, but more people are in extreme need

Six in ten charities (61%) say they are generally having to do more with less compared to this time last year.

Despite this, almost half (47%) of charities are seeing more people coming to them in a state of extreme need compared to a year ago. This is particularly common for charities that work toward the prevention or relief of poverty, with half of these strongly agreeing (52%) that they are seeing an increase in those in extreme need.

Charities report low staff morale in the face of increasingly complex need

Despite many charities being overwhelmed with need, one in eight face having to make redundancies or reduce staff numbers.

Half of charities reported that the cost-of-living crisis is negatively impacting staff/volunteer morale (52%) and that they are struggling to recruit or retain suitably qualified candidates or volunteers (51%).

Key findings from September 2023

Rising demand for charitable services shows no signs of slowing down

Around six in ten (59%) charities say that demand has increased compared to a year ago, with nearly a third (31%) saying it has increased substantially. 

The continuing pressures of the cost-of-living crisis means that the challenges facing many charities of higher demand, lower income, inflated costs, have become entrenched.

Some charities have been forced to turn people away

Two-fifths (41%) of charities surveyed who say they cannot help anyone else, and one in eight (12%) who say they have been forced to turn people away.

A Welsh homelessness organisation said, "our operations, more crucial now than ever, are stretched thin, forcing us to prioritise essential services while pausing others, leaving gaps in our support network."

Many charities plan to invest in their long-term energy efficiency

Despite the Government discount scheme for businesses and charities, nearly a third (31%) of charities disagreed that they have been able to get support to cope with the cost of their utilities. With all Government support for energy costs expected to end in March 2024, one-third (32%) of charities say they plan to invest in improving their energy efficiency for the long-term.

The Charity Resilience Index is stable at 68%

Just half of charities have high levels of confidence in their ability to meet demand for their services, both now (50%) and over the next 12 months (50%). 

Similarly, only half of charities are very confident that they can afford their overheads such as energy, buildings, and supplies (50%)

.

Key findings from April/May 2023

More charities were feeling confidence about their ability to copy with the effects of the crisis

More than three quarters (78%) of charities reported that their senior management team and trustee board felt confident to face current challenges and 36% had developed a detailed plan to face the cost-of-living crisis.

Charities were increasingly asking funders for support with staff costs

The proportion of charities who had asked or would ask funders for help with increased costs remained at around four in 10 in line with findings from January 2023. 

Over the same period there was a significant increase in charities who has asked or would ask funders to pay for staff salary increases (from 8% in January to 22% in April/May).

The charity resilience index was unchanged at 67%

In April/May the Index remained at the same level recorded in January 2023. Charities that survived the difficult winter continued to struggle to meet costs and provide essential services despite a more positive economic outlook for the UK.

There was an increasingly negative impact on the voluntary sector workforce

Seven in 10 (70%) charities said that the rising cost of living was impacting the morale of their workforce and six in 10 were struggling to retain or recruit suitably qualified candidates or volunteers. This was a substantial increase since we surveyed a similar sample in January 2023 (up from 53% and 43% respectively).

Scottish charities were more likely than English charities to have cut services

Scottish charities were significantly more likely to report that they had made cuts to services and did not have room to cut further (35% vs 20% of English charities). Nearly three in five (56%) Scottish charities were worried about struggling to survive compared to just under two in five in England (38%).

Key findings from February 2023

Most charities have seen an increase in demand for their services

In January 2023, nearly three in five (57%) charities reported that demand had increased compared to the same time last year, including a quarter (24%) of charities who say that it has increased 'a lot'. The research indicates that charities working for the prevention or relief of poverty are particularly likely to report an increase in demand for services.

Only one in three charities are highly confident in their funding

A third (31%) of charities are very confident that their current funding is secure, while around half are confident that they have the funds to meet current demand. Less than two in five are confident that they can afford to maintain their staffing levels over the next year (36%) or have a plan for maintaining or growing their income over the next 12 months (37%).

More than half of charities are worried about their survival

Concern about survival peaked at 60% in December before dropping back in January (53%). The concern is particularly acute among charities involved in support or care services (e.g. those working with disabled people, children or the elderly.) Across December and January, around seven in 10 (71%) of these charities said that they were worried about struggling to survive, compared to 44% of faith-based charities.

Read the February 2023 report

Charities in the North of England are among the hardest hit

In the North of England, demand has increased for nearly seven in 10 (67%) charities, and two-fifths (40%) say it has increased substantially (compared to 55% and 24% across the rest of England). Charities in the North (63%) are also significantly more likely to have used their reserves to meet running costs than those based elsewhere in England (50%).

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