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People are cutting donations despite rise in use of charity services, survey shows

More people have used the services of charities in the past year, but the proportion of people who are cutting their donations has also grown, according to a new survey.

The online survey, carried out by research firm Opinium for investment managers Time Investments, polled 2,018 adults. It found that 9 per cent had used charities more over the past year than the year before, whereas 5 per cent had used them less. But 15 per cent said they had donated less money in that period, while 13 per cent said they had given more.

The survey found that south-west England had the largest proportion of people who had used charities more in the year (14 per cent). The south east and the west midlands had the largest proportion of people who had used charities less in that time – 7 per cent.

London had the largest percentage of people who had increased their donations in the past year (18 per cent); the west midlands had the largest percentage of people who had cut their donations (19 per cent).

A recent report from the National Council for Voluntary Organisation and the Charities Aid Foundation found that the number of people who donate to charity grew in 2010/11, but the median donation size fell by £1 in the year to £11.

Nigel Ashfield, managing director of Time Investments, said: "Our findings are very alarming. Charities have a key role to play in our communities and, as more people face up to financial hardship, their services are needed more. However, not only are donations falling but charities' stock market investments have also been damaged in recent years."

In order to boost their income, said Ashfield, more charities were moving their money out of deposits and into investments in other asset classes. "Any interest on a charity’s cash deposit is likely to be negligible and, as with the return from medium-term gilts, will be below inflation," said Ashfield. "Indeed, just over one in four charity deposit accounts are paying less than 0.1 per cent gross or less on balances of £50,000 or more, and only 9 per cent are paying 2 per cent gross or more."

This article was taken from www.thirdsector.co.uk – http://www.thirdsector.co.uk/Finance/article/1143927