Covinformation: Desk top research report on the impact of Covid-19 on charities

A recent nfpSynergy report provides some useful insights into how the pandemic has affected charities and consequently how they have responded to the challenges and opportunities presented. The headlines are that charities have been impacted by traditional income streams contracting, changes to volunteering demand and methods, the need to review and change the way services are provided and communities served. The report is divided into four sections: financial impacts; service provision; the public and charities; and the impact on the sectors’ ability to deliver its charitable purposes.

Finances

The report identifies different surveys and research across the sector, which suggests charities could face an estimated funding gap of over £10bn. This reflects the facts that fundraising activities have been significantly curtailed in the lockdowns, the demand for services has increased, and those charities with reserves are likely to have used them to support the continued work of the organisation. However, not all charities have felt the financial impact in the same way, with some organisations taking advantage of government schemes, some large funders freeing up additional funds or being more flexible in the way grants could be expended, and, finally, the recognition that a significant sub-set of surveyed charities saw their incomes increase over the course of the pandemic (for example charities supporting the NHS).

The report portrays a nuanced picture of different charities having different experiences: some accessing government funds, some furloughing staff at a time of great need, some benefitting from changes in the investment and funding approaches of charitable foundations, some seeing volunteer numbers rise, and many seeing volatility in individual and corporate donations.

Service provision

The most commonly cited change in the services provided by charities has been the move to more digitally-based solutions. However, the report also identifies several other catalysts:

• The fact that the demand for services was increasing before the pandemic;
• The intensification of demand as a direct consequence of the pandemic and government actions (such as lockdowns);
• Build-up of back-logs as a consequence of social distancing measures or the temporary suspension of some activities;
• Spill-overs from other impacts of the pandemic on society; and
• The shrinking of supply.

 All of these point to the potential for the impact of the pandemic on the charity sector to have a very long tail, with demand not being tackled as easily as before due to a ‘hollowing out of delivery capacity’.

Conversely, the report highlights research data that suggests that charities have reviewed their working practices and improved efficiency and that those efficiencies will continue once lockdown conditions have been lifted. However, the broader conversations about the future work environment, workloads and morale not covered in the report make the picture relating to staff welfare, retention and productivity less clear.

The public and charity sector relationship

Before the pandemic, the public’s perception of and relationship with the charity sector was complex and ever-shifting. In general, the perception was that public trust had declined over recent years and that the sector needed to ‘do better’. This picture was not always borne out by research papers and surveys. Unsurprisingly, the pandemic has not clarified the situation.

nfpSynergy research saw trust in a ‘number of institutions’ peak in May 2020, but not for charities. Indeed, the annual research undertaken by CAF suggests that charities have benefitted from an uplift in public trust in 2020.This is linked to the possibility that more people have come into contact with a charity (directly or indirectly) and that media coverage of the sector, as a whole, has been more positive.

The pandemic also saw an increase in informal volunteering within society and the growth of ‘mutual aid groups’ to support the more vulnerable and isolated in local communities (such as collecting prescriptions, doing the shopping for neighbours and offering regular contact). The report rightly details the benefits to communities of such activities but also points to the benefits to individual volunteers (a sense of purpose, solidarity). With the NHS Volunteer Responders recruitment drive reaching 750,000 people within days, the suggestion was that there was a groundswell of interest in volunteering (possibly for a specific cause rather than in general). However, the actual number of tasks logged by these volunteers was around 75,000 and often centred on the same households.

The initial increase in interest in volunteering has not been sustained in measures of formal volunteering activities (which may be linked to social distancing and lockdown measures). Similarly, the demographics of volunteers has changed, with older people being less inclined to volunteer, while digital approaches and furlough provide greater opportunities to others previously unable to volunteer.

Achieving charitable purposes

In the short to medium term, trustees are likely to view the impact of the pandemic in negative terms, including the ability of the organisation to deliver charitable purposes in the coming twelve months. Immediate funding concerns and the potential long-tail of COVID-19 on demand for services will continue to exercise the strategic thinking and financial and operational planning of many charities.

Overall, the report provides a rich mosaic of the ways in which the sector has been impacted by the pandemic; both positively and negatively. While it is beyond doubt that many charities have suffered and continue to do so, it is also possible to identify golden rays of hope in the information presented in the research: the move to digital solutions; an increase in the diversity of volunteering opportunities; and potentially an opportunity to connect to and communicate with more people could raise profile and public trust. The challenge for the sector is to latch onto the opportunities appearing through the murk of lockdown and ‘build back better’.

The report Covinformation: Desk top research report on the impact of Covid-19 on charities can be found at www.nfpsynergy.net