The Status of UK Fundraising 2022

Charities are used to operating in difficult circumstances. They’ve been adaptable through a pandemic, through lockdowns and restrictions, and now face rising prices and financial uncertainty amid the cost-of-living crisis. But throughout it all, the sector has kept moving and, crucially, continued fundraising.   

However, it’s not exactly been smooth sailing. According to the 2022 edition of the Status of UK Fundraising report, from software providers Blackbaud, charities in the UK have reported that their income has decreased for the third year in a row.  

The report, which is now in its fifth year, revealed that nearly a third of charities (32%) said their income had decreased in the last 12 months – though this was fewer than in 2021 when 40% of organisations said the same. 

As expected, the pandemic was, by far, the main driver of a decrease in income, cited by two thirds of respondents (66%), followed by inadequate resourcing to grow income (33%), existing supporters giving less (32%), and the organisation not having enough people with the right skills (31%).  

Interestingly, 32% said they experienced a decrease because of the previous year’s income being boosted by exceptional or unplanned activity.  Benefitting from the pandemic was mentioned as one of the main reasons for income growth by 35% of charities, second only to those who cited exceptional gifts. 

Boom or gloom? 

Despite the concern over declining income, more than half of charities reported that they had either exceeded their fundraising targets or met them. Fewer than a quarter (23%) said they failed to reach their target.  

This achievement demonstrates that, while there are challenges to respond to, charities have generally been good at accommodating these. Income may have declined, but most orgs are still meeting or exceeding goals when they plan for this eventuality.  

The organisations, however, that reported an increase in income tended to be bigger and invest in tech. Blackbaud’s research shows that they are more likely to have an income exceeding £10 million and be optimistic they will meet future targets, retain supporters, and deliver services. They are also more likely to acknowledge that recruiting and retaining staff, and keeping up with the pace of technology change, is a challenge.  

Smaller organisations need not worry, however – size has no bearing on whether charities are able to be digitally mature. Digitally mature charities – those that scored themselves as an 8 or above in terms of digital integration across the entire organisation – are also more likely to be successful and size has little bearing on digital maturity. Digital maturity is all about culture.  

While more than half of all charities say they invest in technology, and even more (67%) say they understand how technology can help, only 35% said they got the most out of it.  

“Those who agree they get the most out of technology are more collaborative,” the report notes. “They are also more likely to be digitally mature, committed to ESG, gaining more supporters than they are losing and more focused on supporter experience than those who do not get the most out of tech.” 

Recruiting and retaining fundraising talent was also a significant issue for the sector. In 2020, less than one in five charities said it was an issue. In 2022, it has become the third most selected issue, with 42% of organisations saying it is one of the main challenges facing the sector in the next three years. 

Retaining talent is linked to income decline as charities begin to lack important skills and talent needed to maximise their fundraising. Unlike pandemics and exceptional gifts, staff retention and recruitment are challenges that charities can plan for and should therefore become a priority area for investment, alongside technology.   

The current economic situation leading to fewer donations remains the most prevalent concern for charities, with 79% of respondents acknowledging this – ten percentage points more than did so in 2020 during the pandemic. Fortunately, almost half (48%) of charities say their supporter numbers currently remain consistent – only 15% say they are losing more than they are gaining.