New research finds funders have responded well to the outbreak of Covid-19

Earlier this year nfpSynergy surveyed 143 grantees and 218 unsuccessful applicants from The John Ellerman Foundation to understand how charities have been impacted by Covid-19, and the overall effectiveness of the foundation. In this week's blog, Tim Harrison-Byrne discusses some of the insights from that research.
By Tim Harrison-Byrne
 

In May and June nfpSynergy surveyed John Ellerman Foundation’s grantees and unsuccessful applicants to understand what the Foundation does well and where it can improve. One objective of the project was to understand how charities had been impacted by Covid-19. The John Ellerman Foundation has kindly agreed to share the findings to help other funders and charities understand the views of their applicants, and where they are struggling.

143 grantees and 218 unsuccessful applicants were surveyed by nfpSynergy between 11th May and 5th June 2020.

Funders have pulled together and been responsive to the situation

76% of the sample believed that funders have been very responsive to the outbreak of coronavirus. Charities have been appreciative of the efforts many funders have made to be more flexible with outcomes or indeed offering emergency funding. As one charity said,

“Funders have been very understanding with regard to project funding, and perhaps not being able to meet outcomes or enabling us to be flexible with how funding is spent.”

Respondent from a £1m - £5m charity

A slightly smaller proportion (65%), but still a majority, believed that funders have pulled together in this situation. For both statements however, smaller charities with an income under £250k were far less likely to agree than larger charities. 61% of small charities thought funders had been responsive, compared to 83% of large charities (an income over £5m).

8 in 10 have seen their income decrease

Perhaps the most unsurprising finding from the research is that 81% of participants in the research said their income had decreased as a result of the pandemic. However, a higher proportion of larger charities with an income over £5m reported this than the smallest charities (income under £250k) - 95% vs 73%.

Smaller charities are far less likely to use the furlough scheme

The topic of furloughing staff was the area where we saw the biggest difference between large and small charities. Only 35% of small charities said they had furloughed their staff, compared to 80% of charities with an income over £5m. For small charities with only 1 or 2 paid staff, utilising the furlough scheme and continuing to provide services may not have been an option. For those who are a little bigger who have furloughed staff, it has placed a strain on those who continue to work.

“Having to furlough staff was challenging as we still required their services but could not afford to pay them, so that has resulted in existing staff taking on more responsibilities.”

Respondent from a £500k - £1m charity

The research confirmed this quote - 63% reported that staff have had to increase their workload.

A third required emergency funding to survive the next 3 months

32% said they required emergency funding to survive until September. This was quite consistent across charity size, though the figure was slightly higher for charities with an income under £500k. This statistic clearly highlights the dilemma for funders. By no means were all charities in immediate crisis, so how to get the money to the right charities at the right time, whilst not neglecting medium and longer-term commitments to others?

“Emergency funding has been focused on the Covid-19 response, but as our activities do not fit this category, we have been unable to apply. However, a huge reduction in income due to cancelled events and other funds re-directing their focus has meant we are struggling to survive.”

Respondent from a £1m - £5m charity

Staff morale is not high and staff are anxious about the future

70% of participants said their staff were very anxious about the current situation. Furthermore, only 38% reported that morale among staff is high. Clearly the pandemic has created a lot of uncertainty for charities. So far only 4% of the respondents reported having made redundancies as a result of Covid-19, though this research was conducted in May and June. A key question will be what happens once the furlough scheme concludes in October.

“Although we have been through a lot of change in the last two months, there is a lot more to come.”

Respondent from a £500k - £1m charity

The findings show a complex picture of perceptions. Many believed funders had responded well, which raises the questions what can funders learn from their improved responsiveness and engagement over this period? Many charities have seen decreases to their income, and for a significant proportion this has led to a requirement for emergency funding that if it isn’t met, could lead to many charities closing their doors. The next few months look set to be tough for charities, and funders will need to be at their very best to support as many as possible.

If you would like to explore the research further then please see the PowerPoint slides attached below. To find out more about this research, please get in touch with Tim Harrison-Byrne on timothy.harrison-byrne@nfpSynergy.net.

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