The public think it costs charities 42p to raise £1, when the reality is that it costs just 12p, according to research released today by the Charities Aid Foundation.
A survey of over 1,000 individuals in the UK also showed that those surveyed said that 26p – more than double the actual figure – would be an acceptable amount to spend.
Analysis of charity accounts shows that the cost of fundraising £1 was 10p in 2007 and 2008, but this increased by 2p in 2009. CAF says this is likely to be a result of the more difficult economic circumstances in the last few years that have forced charities to spend more on fundraising.
Richard Harrison, director of research at CAF said: “our research shows the discrepancy that exists between the perceptions of charity fundraising and the reality.”
Professor Adrian Sargeant of the Center on Philanthropy at Indiana University said that we have known for a long time that the public think it costs much more than it does to raise a pound. “There is a lot of research on misconceptions,” he said. “It costs considerably more than 12p to raise £1. Looking at accounts does not give an accurate figure for fundraising acquisition. Overhead costs, awareness recharging and other accounting games make accounts worse than useless for this kind of analysis. There are also huge variations by cause and significant economies of scale, so their (CAF’s) sample will shape their results.
“You will get better results from the Fundratios survey. It varies year on year, but typically hovers around a pound to raise five.”
He pointed out that the amount people think it costs to fundraise has not changed significantly in many years. “No-one is actively working on the education of the public – barring charityfacts – because the government went for regulation rather than education.” However, he said that research had shown that members of the public who were donors have a better view of fundraising costs than non-donors.
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