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Winter 2009

Charities mugging up

As recession gloom deepens, interest groups and industry sectors seem to be competing with one another to establish which of them has been most badly affected. Homeowners might have it worse than first-time buyers. Retail is perhaps underperforming the banks. Immigrant plumbers may receive a lesser quality of governmental mercy than farmers.

But the third sector, charitable organisations, rely on most of the above for their funding. Shelter, the housing charity, lost £400,000 last autumn because of the collapse of its newly-nationalised sponsor Bradford & Bingley. The British Red Cross was forced to cancel a fundraising gala that usually nets it £500,000 because corporate backing could not be found. Cats Protection and the children's hospice Naomi House lost £16.9 million after investing in Icelandic bank Kaupthing Singer & Friedlander. Even high street charity shops, which often profit during economic downturns as shoppers look for cheaper used goods, have discovered that potential stock is more likely to end up on ebay as donors seek to make a quick buck. The industry analyst PriceWaterhouse Coopers suggests that British charities will lose a total of £2.3 billion in 2009.

Of course, the financial difficulties that cause this shortfall are the same ones that will see a significant increase in demand for the services offered by these charities. We need them more than ever. The higher number of repossessions, for example, has resulted in an equivalent 20% rise in demand for Shelter's services while it is already having to lose staff.

There is hope, however. The Red Cross expects donations to grow overall in 2009, despite the value of its legacies and corporate donations decreasing dramatically. How so? Herecometh the lesson: 'face-to-face fundraising'. They irritate and cajole in unequal measure, but those irksome 'charity muggers' who stop you in the street for a widow's mite per month are what might keep our national charitable aims afloat. Chug away, ye bright tabard-wearing folk, chug away.