Public dramatically overestimate charity admin and fundraising costs - but are more tolerant of the latter

  • Marked increased in public willingness for charities to invest in fundraising to boost future income
  • “Charities need to better explain the true level of, and rationale for, all their costs,” vies Saxton
  • “Charities should talk about ‘necessary management’, rather than ‘administration’,” Saxton adds

The public are dramatically overestimating charities’ admin and fundraising costs but are more tolerant of the latter - according to new research out today (see the figures by downloading file)

Public think that, on average, it is acceptable for a charity to spend twice as much of its income on fundraising (23% of income) than on admin (11% of income). However, they falsely believe that, on average, over a third (35%) of a charity’s income actually goes on fundraising and a shocking 40% on admin, when true figures for average-sized charities are likely to be far lower than this – not least regarding admin.

Leading not for profit sector think tank and research consultancy nfpSynergy’s Charity Awareness Monitor has tracked a representative sample of 1000 16+ year olds throughout mainland Britain for the past decade, uncovering donors’ attitudes and habits as well as what they think of charities’ fundraising strategies and tactics.

Encouragingly for fundraisers, the fact that the gap between perceived actual and acceptable average spend is much smaller for fundraising (35% - 23% = 12% gap) than for administration (40% - 11% = 29% gap) suggests that public are happier for charities to spend money on fundraising, and are thus less likely to think that charities “misspend” their income on this activity.

Moreover, compared with last year, there also seems to be a greater public willingness for charities to invest in fundraising to boost future income, with 2 in 5 (41%, July 2008) now agreeing that “it makes sense for charities to spend more of my donations on fundraising this year, if it will increase their income for future years” – only a third (34%) having thought the same last year (July 2007).

nfpSynergy’s Driver of Ideas, Joe Saxton, said:

“The public appear to significantly overestimate what charities spend on their fundraising and their admin costs, and show especially low tolerance towards the latter. This should prompt charities to better explain the true level of, and the rationale for, all of their costs. Greater relative public acceptance for fundraising, plus an increased willingness to invest in fundraising to boost future incomes, suggests this educational task vis-à-vis costs may be slightly easier in relation to fundraising than admin. All the more urgent, then, for admin to be positioned as ‘necessary management’ – no wasteful burden, but rather an essential lubricant without which the very wheels of charity would not turn.”

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MEDIA COMMENT: To interview nfpSynergy’s Joe Saxton about these findings, please contact him direct on 07976 329 212 or joe.saxton@nfpsynergy.net; or, alternatively, contact Adrian Gillan (0774 086 7215; E: adrian@gillanmedia.com) for further assistance.

Note to editors:

nfpSynergy (www.nfpsynergy.net) is the UK’s only research consultancy dedicated to the charity sector and not-for-profit issues. It provides ideas, insights and information to help voluntary and community organisations thrive in an ever-changing world. Regularly harvesting the social and charity-related views of public and parliament, media and business - not to mention not for profit organisations themselves - nfpSynergy has a vast and ever-growing knowledge pool from which to extract and deliver insights.

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CAM July 08

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