Since last month’s Covid Charity Tracker Survey, Covid cases have continued to rise steadily in a clear “second wave” and greater lockdown restrictions have been implemented across much of the country. Our previous surveys found that the March lockdown made it difficult for many charities to deliver their services on the ground, at a time when need was very high – the “impact of social distancing on service delivery” was consistently the number one concern reported by charities over May and June.

As our previous surveys have highlighted, many charities have already taken a significant financial hit since March, with the closure of charity shops, cancellations of fundraising events and public donations being hit by the recession. We've previously estimated the sector could be facing a £10.1bn funding gap as a result of Covid.

With winter fast approaching, and lockdowns unpredictable, charities are now experiencing many of the same challenges. Those who deliver frontline services over Christmas may well find themselves facing uncertainty about how they will ensure people receive the support and services they need. Continued restrictions on large events will particularly affect those who rely on Christmas performances, fayres and collections for fundraising.

Christmas fundraising is vital for many charities, yet many expect to raise less this year

For many charities, Christmas is a key period for fundraising, either through an increase in public donations, spending in charity retail shops, or other fundraising activities. Approaching half (44%) of survey respondents said that this period is either very or quite significant to their total annual income. 

However, a substantial proportion of charities are expecting falls in their donation income over Christmas. Overall, a quarter said they expected donation income to be more than 25% lower than it was last year, and just over a fifth expected it to be up to 25% lower. Very few expected increases.

Smaller charities were particularly concerned, with two-in-five expecting their donation income this Christmas to be more than 25% lower than it was last year.

For your donation income over this Christmas period, what difference roughly are you expecting compared to last year's Christmas campaign?

Charities that are more dependent on income over Christmas were far more likely to report that they expected a fall in donations of 25% or more - 41% of charities who reported Christmas income being “very” or “quite” significant, versus 13% of other charities.

Despite this, most charities (59%) said it was likely that they would be able to deliver their services adequately over Christmas – but 19% believed they would not and another fifth said it was neither likely nor unlikely. This suggests that many are going to be able to “make do” over this period, and impacts from lower donation income over Christmas may strike in 2021. This is perhaps not surprising, as it’s unlikely services will be delivered with funding coming in during the same time period.

Most charities need additional support – ranging from financial support to more opportunities to collaborate

Unsurprisingly, when asked what support would help them to deliver their objectives, the majority (68%) said that they needed additional financial resources, reflecting our previous findings about funding losses and higher demand for services. Smaller charities were slightly more likely (73%) to say this than larger ones (64%).

Charites also highlighted uncertainty about social distancing as an important barrier to achieving their objectives - two fifths said that more certainty over future social distancing arrangements would help, and a fifth also needed more clarity over current social distancing arrangements. There also appears to be appetite for more collaboration within the sector - a quarter (26%) of respondents said more opportunities to collaborate with other charities would help them deliver on their objectives. Just 7% of charities said they did not need any additional support.

What additional support would help you deliver on your objectives in the next 12 months?

But few have accessed government backed loans

In order to support businesses and charities, government has introduced four temporary loan schemes: the Bounce Back Loan Scheme, the Coronavirus Business Interruption Loan Scheme (CBILS), the Coronavirus Large Business Interruption Loan Scheme (CLBILS) and the Future Fund. Few charities appear to be making use of these government loan schemes: we found that just 7% of charities had used one of these schemes, and 3% plan to apply. Among smaller charities this is even lower: just 1% have applied. This is lower than use seen among businesses, for example, the Bank of England's monthly decision maker panel data reports that 19% of businesses are currently using, or plan to use, the CBILS or CLBILS.

And few expect to make use of the new Job Support Scheme – with more redundancies looming

With the Job Retention Scheme coming to a close at the end of this month, charities are now reaching a crunch point with regards to decisions on redundancies. Nearly a quarter (23%) expect to make staff redundant when the Job Retention Scheme ends. This is similar to the results September’s Covid Charity Tracker survey, when 19% said they expected to make redundancies after 31 October.

The Job Retention Scheme will be replaced by a new Job Support Scheme, which allows employees to work part time, but pay for hours not worked can be split between the employer, the government, and the employee (through a wage reduction). One-in-ten charities told us they intend to use the scheme, but the majority (68%) do not. This is less than the one-in-five charities who said they would benefit from an extension to the Job Retention Scheme - though some respondents did comment about issues with eligibility for government support.

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