Jamie O’Halloran, Economist at PBE, said:

“These latest figures confirm that the UK is now experiencing double digit inflation for the first time since 1981. This is driving a punishing cost of living crisis, with the threat of recession looming ever-nearer.

“As we approach the lifting of the energy price cap in October, the charity sector is braced for a swell in demand for its support from those most in need. But the sector itself is feeling the relentless squeeze of this crisis on its own finances.

“Charity incomes are expected to fall as inflation means the cost of giving is higher, while costs rise. We now expect that an average charity with an annual expenditure of £1m in 2020 would need to find an extra £113,000 by 2024 for staffing costs to ensure their staff are not financially worse off. At a time of falling incomes and rising demand, that is simply out of reach.

“This is an all hands on deck crisis, with foodbanks, babybanks and debt charities experiencing the immediate impacts most intensely. But the wide consequences of poverty mean that the majority of charities are now braced for rising demand, from mental health charities to domestic abuse services.”

Want the latest news, events, and projects from PBE delivered straight to your inbox?

Subscribe to our newsletter