Overview

  • Around one in four small charities deliver public services ‘a great deal’ or ‘a fair amount’ as part of their work, compared to 59% of the largest charities.
  • 62% of small charities do not deliver public services at all.
  • In 2017/18, small charities earned £1,140m in income from government to deliver public services on their behalf.
  • The value of government contracts has declined for charities of all sizes over a five-year period, most markedly for small charities with an income between £100k and £1m.
  • 22% of small charities make a loss on their public sector contracts, and 61% of small charities subsidise public service contracts with income from other sources.

What proportion of small charities deliver public services?

  • Around one in four small charities deliver public services ‘a great deal’ or ‘a fair amount’ as part of their work, compared to 45% of large charities and 59% of major charities.
  • 62% of small charities do not deliver public services at all.

What is the value of government income to small charities?

  • Government income was worth £1,982m to small charities in 2017/2018, covering both grants and funding for commissioned.
  • The value of government funding has declined for small charities over the past five years, and evidence suggests this is related to a shift from grant funding to commissioned and contract relationships as the main approach to funding in the public sector.
  • Charities with an income of between £100k and £1m saw the steepest drop.

What are small charities’ experiences of delivering public services?

  • In 2020, 61% of small charities subsidise public service contracts with income from other sources.
  • One in five say they have delivered a contract outside of their core mission.
  • Small charities are much less likely than large and major charities to walk away from public contracts because of operational risk or mission drift.

Do small charities break even on contracts?

  • In 2016, one in five small charities make a loss on the public service contracts they deliver.
  • Half break even and three in ten make a profit.
insights

Demand for services

Explore data on how small charities perceive demand for their services and how this has changed

Find out more
insights

Government funding to small charities

How much money do small charities receive from the government?

Find out more

Further reading

NCVO 2020 UK Civil Society Almanac 2020

New Philanthropy Capital 2020 State of the Sector 2020: The condition of charities before the Covid-19 crisis

Locality 2017 Powerful Communities, Strong Economies: The final report of the Keep it Local for Economic Resilience Action Research Project

Locality 2016 Our Impact report 2016

NFPSynergy 2016 Challenging cuts: Investigating the response of charities to frontline service cuts

Lloyds Bank Foundation 2016 Commissioning in Crisis: How current contracting and procurement processes threaten the survival of small charities