# Two-fifths of charities using reserves & asking funders for more help as need & costs soar

- Link: https://fundraising.co.uk/2024/01/19/two-fifths-of-charities-using-reserves-asking-funders-for-more-help-as-need-costs-soar/
- Published: 2024-01-19T09:00:00+00:00
- Author: Melanie May

**Soaring need for charities’ services combined with higher costs mean some 40% 
in England and Wales are now using their reserves to meet operational costs. 38%
are also asking funders for more help, new research from the Charities Aid Foundation
has shown.**

Half (50%) of charities now say they are at full capacity and cannot help anyone
else, as a result of much higher demand and sustained financial challenges. [CAF’s](https://www.cafonline.org/)
research with more than 650 organisations in England and Wales found that one in
seven (15%) say they are having to turn people-in-need away.

Only 31% of charities say they have the capacity to help any more people due to 
the pressures of the cost-of-living crisis. As part of the research, a children’s
support service in the South East said, “the overall picture for our charity is 
uncertainty and anxiety” and a Northern charity reported that they are “stuck in
a vicious circle that we are trying to break out of.”

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 * Of those at full capacity, 51% are making judgements to prioritise people most
   in need
 * More than a quarter (28%) have created a waitlist
 * 9% have stopped taking any referrals
 * In addition, 25% of charities with capacity issues are scaling back what they
   do to focus on core services
 * 16% are considering charging fees for their services to meet the need
 * 41% are signposting to other organisations

An autism charity in the South-East said that “it now takes two minutes to fill 
50 spaces when we open the waiting list to new referrals.”

#### Issues more complex

CAF also found that the issues charities are dealing with are becoming more complex.
47% of charities surveyed say that more people are coming to them in a state of 
extreme need compared to this time last year, and two-fifths (40%) are helping more
people to navigate public services than a year ago. One poverty relief charity in
London said: “It seems relentless. More and more people come to us in even greater
need and staff feel helpless to support them all. Those same staff are also struggling
themselves.”

#### Many charities in precarious position

The challenges of the cost-of-living crisis for charities of higher demand, lower
income from donations and grants and inflated costs, are reinforcing one another
to put many charities in a precarious position, CAF says. Nearly two-thirds (61%)
of charities say they are having to do more with less compared to a year ago, and
as well as using reserves and asking funders for with increased costs, 12% are also
forced to reduce staff numbers or make redundancies.

Neil Heslop OBE, Chief Executive of the Charities Aid Foundation, said:

> “Many charities are stuck in a Catch 22 situation. They face higher demand, while
> struggling with declining income, and significantly higher costs. Despite being
> the last port of call for the most vulnerable in our society, they are having 
> to make very difficult decisions to introduce waiting lists, charge fees or turn
> people away who desperately need their help.
>  
> “The pandemic and support in the Chancellor’s 2023 Budget brought stop-gap solutions,
> without which many more charities would have folded. But with charities facing
> significant uncertainty, we need Government to take the lead and introduce a turnaround
> plan to support a strong charity sector and thriving civil society for the future.”