Charities ‘have no room to cut further’, research warns

Almost a quarter (24%) of charities say they have already reduced services as far as they can amid the cost-of-living crisis with "no room to cut further", research is warning.

The findings have emerged in a survey of 700 charities into how they are coping with rising costs.

This survey, carried out by Charities Aid Foundation, found that this month less than half (49%) of charities feel confident they have enough funds to meet demand for services. This is down on 58% who were confident when asked last month.

As of this month round half (51%) of charities are using their reserves to cover their core costs. This is an increase on the same period last year, when 40% were using their reserves in this way.

More than half of charities are concerned about their ability to survive, up from a third when asked in April.

“Charities are running out of options, forcing them to rely on their reserves and cut back on the services they provide,” warned CAF chief executive Neil Heslop.

“This research provides stark evidence about how the sector is responding to the triple threat of soaring demand, falling donations, and rising costs.

“Charities are at the heart of our communities and are carrying the weight of the worst effects of the cost-of-living crisis."

Sector leaders are concerned that charities could face further financial problems next year, when government support through the Energy Bill Relief Scheme to meet rising energy costs finishes in March.

The government is currently reviewing the scheme which is set to be “significantly lower and targeted at the most affected”.

Heslop added: “The government needs to recognise the critical role that charities are playing to care for those who are most vulnerable in our communities. As a start, these organisations should be placed first in the queue to receive additional support for energy bills from April.”

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