Adapting your organisation to meet the evolving crisis of rising costs

Why your organisation needs to adapt to meet the evolving crisis

Rising costs are having a massive impact on the VCSE sector across Britain and Norfolk is no different. To put the financial problems facing charities into perspective, Pro Bono Economics calculates that an average charity with annual expenditure of £1m in 2020 would need to find an extra £113,000 by 2024 just to cover staffing costs to ensure their employees are not financially worse off than before.  In addition, a ‘UK Giving Report’ highlights that a three-year £100,000 grant or contract awarded in 2022 will be worth £90,660 next year and £88,300 in 2024.  It is therefore important for charity boards and leadership teams to factor higher than anticipated costs into any planning assumptions as well as determining if demand for their services is likely to change.

 

How rising costs are affecting the VCSE sector

This dynamic landscape of rising costs linked to growing demand across VCSE’s and community assets has been well documented in recent months, with a State of the VCSE Sector Survey (undertaken November 2022) showing that over the last year, over 4 in 10 charities which pay for their energy bills directly have experienced a rise in energy costs. And of those, over half report that their energy bills have increased by 50% or more.

With ‘The Cost of Living Crisis: The impact on grassroots community sport and recreation’ by the Sport and Recreation Alliance highlighting how 70% of clubs say they plan to charge members more in fees which will likely impact those on lower incomes and exacerbate existing inequalities in participation.  One of the report’s key asks is ‘Improved access to finance and investment in energy efficiency and green energy supplies for grassroots community clubs and facilities to cut costs and improve sustainability’.  Recognising that for many community assets and buildings one of the biggest barriers to improving energy efficiency is the age and fabric of their building and lack of funds to make improvements.

 

Challenges other than rising costs

Against this backdrop charities and community groups are struggling with recruiting and retaining staff and volunteers, according to ‘2022 State of UK Fundraising’ 42% report that it is one of the main challenges facing the sector in the next 3 years.  However NCVO’s UK Civil Society Almanac 2022 states that the voluntary sector’s workforce grew 3% over the last year, the fastest growth of any sector over the last decade, possibly a response to increased demands on services.  Yet the voluntary sector has the oldest workforce compared to the public and private sectors, with 1 in 4 staff aged 55 and above, which could further increase future workforce pressures.

 

What can you do?

Looking ahead, investment to ensure you can effectively and efficiently raise resources, manage operations, deliver programs, and measure impact, will be pivotal. UK organisations can rise to the challenge of driving even more social impact, but it will require us individually and collectively to be agile, to establish deep and meaningful connections, to maximise the use of digital experiences, and above all to connect and amplify our causes and the critical role of fundraising.

For example, you could:

  1. Be part of sector, funder and partner discussions about funding or commissioning developments to highlight the benefit of longer-term commissioning and funding streams raising awareness with funders about the challenges faced by charities and need for support.  Or participate in local and national campaigns to raise awareness of the challenges you face.
  2. Use connecting and networking opportunities (such as those supported by ECP) to explore ways to work collaboratively with other organisations to maximise impact and/or cut shared costs
  3. Explore funds that could help with longer term resilience planning – such as carbon footprint improvements and energy efficiency.
  4. Explore options of private sector sponsorship – many organisations are looking at developing a social good/impact element.
  5. Consider how you might encourage younger or wider workforce interest by changing your terms and conditions or improving the training and developments offers in your organisation.  You can find out more about the Empowering Communities Training Programme here.

If you have ideas about how the Empowering Communities Partnership can support you to address the issues identified above do get in touch, we would love to hear from you!  Email: enquiries@ecnorfolk.org.uk

 

Further information and resources

Below are some resources which may be useful:

  • NCVO including a series of free webinars to support charities with some of the challenges they may be facing.  As well as practical tips and step-by-step guides on how to find the money you need for your community group, organisation or charity
  • The Government has announced an Energy Bills Discount Scheme (EBDS) from April 2023 to April 2024 for eligible non-domestic consumers in Great Britain and Northern Ireland. Details can be found here
  • The National VCSE Data and Insights Observatory, launched by Nottingham Trent University, will work with organisations across the UK to capture data which will provide insights on the management, delivery, and outcomes of VCSE sector in order to better serve communities.
  • Funding portals like Grantway can help you find funds such as the £900,000 VCSE Contract Readiness Fund to help enable VCSEs increase their participation in public service procurement in England.  Or contact enquiries@ecnorfolk.org.uk to find out about how the ECP can carry out a funding search for VCSEs in Norfolk.
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