# Charity budgets and the credit crunch… - Link: https://fundraising.co.uk/2008/10/08/charity-budgets-and-credit-crunch/ - Published: 2008-10-08T20:06:34+01:00 - Author: Howard Lake There are signs now that the crunch is, and should be, affecting the current budget process many of us are going through. [⌊Lego Credit Crunch⌉](http://www.flickr.com/photos/allythomsons/2911981056) A charity CEO I talked to today reported one major donor pledge reduced from £50,000 to £10,000 and another for £350,000 cancelled. So, maybe, a writing-down of at least the larger ‘city’ major donor income is advisable. Of course legacies are falling along with the fall in house prices – another 10% next year anyone? And trusts are dependent on dividend income so, maybe not so much in 2009, but in 2010 there may be some severe reductions there. Our ordinary donors, however, seem to be adamant that unless sacked they will maintain their support; though caution here may also be advisable, as donations may just be somewhat down if food and fuel prices stay high. ## Advertisement I hear mixed messages from heads of fundraising. Some seem to be experiencing a steady fall in income across the board, others say that their new or improved fundraising techniques and constant innovation will equal out any fall. Does anyone have any additional advice or even experiences that could guide us? * **[Brown bets the house…. But there is a better way!](https://fundraising.co.uk/2008/10/08/brown-bets-house-there-better-way/)**( 8 October 2008) * **[SocialVibe gives you adverts to raise funds for charity](https://fundraising.co.uk/2008/10/14/socialvibe-gives-you-adverts-raise-funds-charity/)**( 14 October 2008) * **[Time to stand up for fundraising spirit](https://fundraising.co.uk/2008/10/21/time-stand-fundraising-spirit/)**( 21 October 2008) ## Comments ### By: admin - Link: https://fundraising.co.uk/2008/10/08/charity-budgets-and-credit-crunch/#comment-3309 - Published: 2008-10-09T15:17:00+01:00 Adam Rothwell at Intelligent Giving has mused on just how much budgets might have to be cut if charities had money in Icelandic financial institutions, for example. , he suggests that, since the UK charity sector has over £75 billion in investments( £15 billion of which belongs to the Wellcome Trust), “it’s a safe bet to say that some of those charities will have deposited cash in Icelandic institutions”. While individuals’ savings in Icelandic banks might now be ‘safe’ or at least reimbursable, it’s not clear if organisations such as charities enjoy the same protection, nor whether other investments in Icelandic institutions are safe. [⌊Iceland geyser⌉⌊Iceland geyser⌉[ Iceland and hot water… by lmrush on Flickr.com ### By: Redina Kolaneci - Link: https://fundraising.co.uk/2008/10/08/charity-budgets-and-credit-crunch/#comment-3310 - Published: 2008-10-09T21:50:28+01:00 Well, I can not see how innovation or new techiques can equal any fall in major donor giving. In the 80:20 principle is true and in many cases it is – then a charity would need a whole lot of innovation to make up the gap in the income. Plus, in my experience innovation and new creativity (often provided by DM agencies) does not come cheap! However, although some charities might be picking the fruit of their new innovations my advice to the rest would be to pick the ‘low hanging fruit’ – in other words to stay focused on making the most of their direct mail to those steady ordinary donors John talks about in his blog and to keep an eye on their renewal and attrition rates. Find out how many of your multi-year donors and first time donors from last year have renewed their support to your charity this year? How many donors have lapsed in the last six months? Think of ways of reactivating these donors with warm and personalised mailings – even refering to the economic crunch and reminding them that charities exist to help other people in crisis. If you have to invest in creativity do so in developing a regular giving programme if you haven’t got one going yet – it is a lot easier to get people to give £5 or £10 a month and keep them giving than to ask them to make larger one off gifts… And perhaps you can take a leaf out of Age Concern’s book who are encouraging their supporters to host a lunch at their home, invite friends who are willing to pay for their lunch with all the proceeds and gift aid going to the charity… some events like this where donors can participate and get others to give to your cause also can make up for decline in direct mail giving. Redina Kolaneci Senior Fundraising & Stewardship Consultant McConkey/Johnston International UK [http://www.mcconkey-johnston.co.uk](http://www.mcconkey-johnston.co.uk) ### By: admin - Link: https://fundraising.co.uk/2008/10/08/charity-budgets-and-credit-crunch/#comment-3311 - Published: 2008-10-09T22:38:11+01:00 Stephen Bubb, chief executive of Acevo, today told The Times: “The collapse of Icelandic banks has hit charities hard. In one afternoon Acevo has had reports of various charities losing up to one fifth of their reserves, in sums ranging up to £12 million. The total losses reported to Acevo add up to over £25 million.” Naomi House in Hampshire is one charity affected. Rosemary Bennett writes in The Times today: “After a highly successful fundraising appeal to build a second hospice for teenagers, it placed £5.7 million on deposit with Kaupthing Singer and Friedlander”, the Icelandic bank. It now can’t access this cash. [http://business.timesonline.co.uk/tol/business/industry\_sectors/health/article4916920.ece](http://business.timesonline.co.uk/tol/business/industry_sectors/health/article4916920.ece) ### By: admin - Link: https://fundraising.co.uk/2008/10/08/charity-budgets-and-credit-crunch/#comment-3312 - Published: 2008-10-10T07:15:27+01:00 According to NCVO, charities might have up to £120 million in invested in Icelandic banks, and therefore at risk. Stuart Etherington was interviewed this morning on BBC Radio 4’s Today programme on the crisis for charities and mentioned the £120 million figure: [http://news.bbc.co.uk/today/hi/today/newsid\_7662000/7662685.stm](http://news.bbc.co.uk/today/hi/today/newsid_7662000/7662685.stm) ### By: admin - Link: https://fundraising.co.uk/2008/10/08/charity-budgets-and-credit-crunch/#comment-3313 - Published: 2008-10-10T14:43:03+01:00 Unite, which has 60,000 members in the not-for-profit sector, is writing to the new minister for the Third Sector, Kevin Brennan calling for concerted government action to help voluntary sector organisations which may have directly lost money in the Icelandic banking debacle or as a result of the investments of its funders. [http://www.unitetheunion.com/nonprofit](http://www.unitetheunion.com/nonprofit) ### By: admin - Link: https://fundraising.co.uk/2008/10/08/charity-budgets-and-credit-crunch/#comment-3314 - Published: 2008-10-11T19:15:50+01:00 At [Christie struck by bank collapse](http://news.bbc.co.uk/1/hi/uk/7664734.stm) the BBC reports that NHS Foundation Trust The Christie, a cancer hospital in Manchester, has £7.5 million in the Icelandic bank of Kaupthing Singer and Friedlander. The sum cosists of £6.5 million of charitable funds and £1 million of NHS funding. ### By: admin - Link: https://fundraising.co.uk/2008/10/08/charity-budgets-and-credit-crunch/#comment-3315 - Published: 2008-10-12T10:33:52+01:00 No guidance John, but a rare glimpse of humour on the subject of Icelandic banks in the form of this image on Flickr.com from Andy Beez: [⌊Unsound as a pound⌉⌊Unsound as a pound⌉[ ### By: admin - Link: https://fundraising.co.uk/2008/10/08/charity-budgets-and-credit-crunch/#comment-3316 - Published: 2008-10-13T11:15:35+01:00 And another comment on the current state of banks from IanLivesey on Flickr.com: [⌊Manchester (UK) - Bet on a Bank⌉⌊Manchester (UK) - Bet on a Bank⌉[