Inflation impacts on charities in many ways [CHARITIES ARE LIKELY to face both new financial challenges
and increased demands to support people as inflation in the UK hits its highest level for 40 years. That is the warning from a coalition of charity support bodies. According to data from the Office for Gas and Electricity Markets, higher energy prices means that an average household will now be faced with an increase in gas and electricity bills of almost £60 a month. Earlier this year, the government announced that it would raise benefits by 3.1% from April. The Institute for Fiscal Studies said that this represents ‘big real terms cuts to the living standards of many of the poorest households’. Alison Taylor, CEO of bank and charity services at the Charities Aid Foundation, said: “Charities are impacted by rapidly rising inflation on many fronts. Many more people in their communities are likely to rely on their support, with 71% of charity leaders worried about managing an increase in demand on their services. “Tightening household budgets are impacting donations, with 14% of people planning to cut back on donations to cover their bills; and in addition, inflation means that donations are not going as far as they used to in real terms. After two years supporting their communities throughout the pandemic, when many had to rely on their reserves, charities are also having to find the funds to pay higher costs, including rent, food and fuel.” Her fears were echoed by Dan Corry, chief executive of New Philanthropy Capital. “The people charities work with are going to be feeling much poorer and very anxious as a result of this steep rise in the
cost of living,” he commented. “Many will indeed be much poorer, as they spend more of their income on food and energy where prices are rising fastest. “The government has not yet done much to help families get through, especially those reliant on benefits. So more people will need the help charities provide; yet charities will find it harder to support them as inflation increases their own costs and erodes the value of reserves and pre-pledged donations.” He said charities ‘must start planning now’. “Inflation reduces the real value of everything,” he said, “so if you don’t increase spending you are cutting the good you can do. But this is very hard to do when your donors will also be feeling squeezed and commissioners are very unlikely to pay more to cover those extra costs. It’s what makes inflation a uniquely pernicious problem for charities. “Funders will therefore need to rethink their strategies. Many will have hoped to replenish their coffers after paying out more than usual through the pandemic. But with returns on endowments having done pretty well despite COVID-19, is now really the time to do so?” Alison Taylor added: “Building financial resilience – a cornerstone of pandemic survival – will remain a priority, including expanding and diversifying the ways in which income is generated. Charities should make every effort to remind UK taxpayers about the value and vital importance of declaring Gift Aid, which effectively adds 25% to every donation, and make full use of any opportunities for unrestricted funding.” q
Legacies provide a lifeline at Oak Tree
[LEGACIES ARE VITAL to the animals of Oak Tree Animals’ Charity:
they would not have been able to move to their current home at Oak Tree Farm, Carlisle in 1982 without generous gifts through wills. All donations, regardless of size, provide a lifeline to the animals at Oak Tree. More than half of the work carried out there is paid for by legacy gifts, and they couldn’t help the number of animals they do without them. Choosing to leave a gift in a will is an exceptionally personal way to help. One supporter who chose to leave a legacy to Oak Tree explained her decision: “My lifelong love for animals and the knowledge that my gift will help support and rehome unwanted animals at Oak Tree Animals' Charity in the future gives me a great sense of happiness. I wish more people would support animal charities like Oak Tree and be part of their incredible work. I want to help Oak Tree Animals' Charity continue its wonderful work for many years to come. It is comforting knowing that I will still be able to support animals long after I am gone.” To find out more about Oak Tree Animals’ Charity, or to enquire about leaving a gift in your will, visit www.oaktreeanimals.org.uk or email fundraising@oaktreeanimals.org.uk. q
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