The Global Credit Crunch Is Starting To Be Felt By Charities

One in four charities that accepts donations has seen a fall in giving in the past year and one in 12 has had to make redundancies, a survey suggests.

The Charity Commission poll of about 500 charities also showed one in five had experienced a rise in demand for their services.

Charities providing health, care for the elderly and social services saw a 21% surge in calls for help, it said.

The commission said many charities were being squeezed by the credit crunch.

Increased costs

The independent charity regulator said 38% of charities reported being hit by the economic downturn of the last year in some way.

More than half – 54% – were affected by increased costs for basics such as energy, food and travel.

Charity Commission chairman Dame Suzi Leather said charities were facing a great deal of uncertainty.

“Even before last week’s problems with Icelandic bank collapses, some charities were really being squeezed by higher costs and higher demands for vital services,” she said.

“They will wonder how they are going to survive the current crisis while trying to continue meeting people’s needs.”

She also urged the public to carry on donating to charities during the current financial crisis. “They need our help more than ever,” she said.

Repossession threat

Housing and homelessness charity Shelter said it had seen an increase in demand for its services due to the problems being experienced in the current economic climate.

A spokesman said: “People are struggling with their mortgages and are facing repossessions so they are calling our helpline to ask for advice.”

The central London branch of Samaritans said it experienced a 25% increase in calls during August and September, compared with the same months last year.

Oxfam also said it had seen a recent increase in demand.

The Charity Commission expressed concern that the the survey showed three-quarters of charities had not put any new measures in place to deal with the financial crisis, and had no plans to do so in future.

Last week, the National Council for Voluntary Organisations (NCVO) said UK charities feared they may have lost up to £120m of funds invested in failed Icelandic banks.

The NCVO said at least 60 of its members had reported that money may be at risk.