Public Over-Estimates Charity Costs
3 November 2008 at 2:19 pm
People in the UK are dramatically overestimating charity administration and fundraising costs – but are more tolerant of fundraising costs according to a new survey.
The survey found 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 huge 40% on admin, when true figures for average-sized charities are likely to be far lower than this.
Not for Profit think tank and research consultancy nfpSynergy has tracked 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.
The survey says 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 boss Joe Saxton says the public appears to significantly overestimate what charities spend on their fundraising and their admin costs, and show especially low tolerance towards the latter.
Saxton says this should prompt charities to better explain the true level of, and the rationale for, all of their costs.
He says 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.
He says that it’s all the more urgent, then, for admin to be positioned as ‘necessary management’ – not wasteful burden, but rather an essential lubricant without which the very wheels of charity would not turn.
The survey results can be downloaded at: www.nfpsynergy.net
