As a membership body, NCVO supports charities of all sizes. This is reflected in our practical training offers, our strategic partnerships, our policy work and in the research we do. Last month, we published some analysis on Britain’s largest charities. This month we look at organisations with an income below £100,000.
This blog summarises what we know about small charities based on the UK Civil Society Almanac 2018 and builds on some of the analysis we did for Lloyds Bank Foundation in 2016.
What we mean by ‘small charities’
There is no one definition of ‘small’. The Small Charities Coalition for example defines small charities as those with an annual income under £1m making up 97% of all charities. However, for NCVO’s Almanac we define ‘micro’ and ‘small’ charities as those with an income under £10,000 and £100,000 respectively.
Less than £10,000 Micro
£10,000 to £100,000 Small
£100,000 to £1 million Medium
£1 million to £10 million Large
£10 million to £100 million Major
More than £100 million Super-major
There is relatively limited financial data for micro and small organisations as they are not required to report in such detail as larger charities are to the Charity Commission. However, as part of the Almanac, a sample of annual accounts for these organisations is used to extract detailed information on their finances.
The vast majority of charities are small and local
There are over 136,000 registered small and micro charities in the UK, making up 82% of all charities. More than half of them (58%) have an income under £10,000. There are also many organisations that are too small to register and therefore are not captured in our data. Some research estimates an additional 600,000 to 900,000 of such unincorporated groups and organisations. Our data also shows, that most of the small organisations (79%) work in their local area rather than on national or international level. A much higher proportion than of larger organisations.
Small charities are more likely to operate in rural areas
The geographical distribution of small charities does not differ greatly from the general distribution of charities, with more organisations, both overall and per 1,000 of the population, in the South East, South West and East of England. However, there is a bigger disparity in London with a much lower proportion of small charities (71%) compared to other regions (85%) due to an increased number of larger charities being based in the capital.
Furthermore, we know from our Navigating Change report that smaller charities are more likely to be based in rural areas. 37% of small charities are so, versus 13% of large to super-major organisations.
There are small charities in every area of work
The smallest charities cover a diverse range of activities. Like larger charities, the biggest number of small charities work in social services (25,500), and culture and recreation (19,700). However, they make up more than 94% of all Parent Teacher Associations, village halls and scout groups.
Funding trends differ for small charities
Small charities’ funding mix differs somewhat from larger charities. For example, 58% of income for small charities comes from individuals with only around 15% from government. In comparison, larger organisations receive a smaller proportion of their income from individuals but a higher proportion from government.
Over the last decade, small charities have seen a 20% decrease in their overall income while income has increased by 30% for major and super-major organisations. At the same time, the proportion of income from government going to small charities has also decreased from 2.7% of the total in 2006/07 to 2.1% in 2015/16.
More research on small charities
Further data on small and large charities can be found on the NCVO Almanac website. The following research reports provide additional insights specifically on small charities:
- The Navigating Change report (2016) by NCVO providing more in-depth analysis of the financial trends for small and medium sized charities between 2008/09 and 2013/14.
- The Value of Small report (2018) by Sheffield Hallam University, IVAR and the Open University exploring the distinctive features and experiences of small charities and medium sized organisations.
- The Giving in London report (2018) by the Centre for London looking at what’s happening to London’s local charities.