With the Coronavirus crisis being around two months old, and the sector media doing daily polls on how grim things are for charities, it’s a good time to take a look at what the emergency reveals about charities. As it is so often the case the current situation has highlighted and deepened existing flaws and fault lines. Here are some of them.

Charities really are pretty politically powerless…

If anybody wants to understand just how low charities are on the list of government priorities, this crisis has given us clear proof. Even the hard-fought-for £750 million appears to be little more than a fund for each emerging social problem that the government wants to tackle: hospices, food banks, domestic violence and so on, aside from the fact it is not clear when or how charities will get any money. Perhaps as worrying as the lack of our power is the sector’s impotence in doing anything about it. The strategy appears to adopt a few hashtags, ‘demand answers’, clothe ourselves in righteous indignation, and adopt social media shouting at anyone who comes near. While business groups appear to have the ear of government and access to the media, we just have the ear of each other and access to our twitter feeds. This powerlessness stems partly from a lack of awareness of the indispensable and ubiquitous role that charities play in society by those in power. When Rishi Sunak talks about the sector’s ‘gentleness’, it is to damn us with lukewarm adjectives.

… partly because we are so poorly understood

The unique role and importance of the sector are poorly understood. If companies have no income, they have no work either. But many charities have seen their income fall, while demand for their services has increased, which neither furloughing nor any other support caters for. This lack of understanding is nothing new. Over the last decade, there have been repeated attacks and scandals by the newspapers and politicians.  One of the underlying themes to these attacks is that if the work of charities is ‘nice to have’, charities are seen as a bit of icing on society’s cake, rather than its indispensable bread and butter.

There is nothing new about this lack of understanding, but sadly the attempts to do anything about it have fizzled. Back in 2015 NCVO and ACEVO agreed to take on the mantle of the nascent ‘Understanding Charities Group’ but little progress has been made since then. The Advisory Group met once and never again. The issue about the gulf between public and political understanding of charities and the reality certainly hasn’t gone away as an academic report last month emphasised. What has faded is any co-ordinated attempt by the sector to tackle it and the Coronavirus pandemic emphasises just how exposed that leaves charities.

The last few years have been a perfect storm for fundraising

Between GDPR and the current crisis, just about every form of fundraising has taken a hit. So GDPR made any form of personalised fundraising (e.g. databased appeals, telephone, emails, etc.) more bureaucratically challenging and dependent on donor consent. Those that escaped the ravages of GDPR (events, street fundraising, street collections, door to door, legacies) have been hit hard by social distancing and bans on mass gathering. To compound the problem investments have shrunk, dividends are drying up and retail operations are impossible at the moment. So just about all forms of income generation have been hit.  Late last year, nfpSynergy predicted pre-virus that non-legacy fundraising would shrink by half over the next 20 years. That prediction now looks like an under-estimation. Cash has been hit hard by lockdown and it may well be the death knell for cheques. Equally depressing is that I don’t know of any organisation that is doing any thinking about this all out battering of the sector’s voluntary income.

Disintermediation of fundraising is well underway

One of the trends in fundraising of recent years is cutting out charities as the middleman. The people who need money go directly to the public. We saw this with Grenfell and during recent terrorist attacks. Somebody sets up a fundraising page and if the publicity is big enough then money will flow. Captain Tom Moore’s fundraising feat of raising £30 million is an excellent example of this – most people who gave care little about exactly what he was raising money for. Just labelling it ‘NHS’ was good enough. The role of charities was at best incidental.  As this trend grows more, more people will be raising money for ‘causes’ where they have no come back for misspent donations, that have only minimal regulation or feedback, and indeed those who raise the money may even struggle to know how to spend it. Back in my days at Oxfam, I had the ‘people give to people’ mantra drummed into me. That mantra is still true today – but now charities just may not be a part of the link between donor and cause. And that is scary.

Volunteers are second-class citizens in sector and government thinking

We did some interviews in April about how charities were doing in the crisis. One of the criticisms that came back was that we hadn’t talked about volunteering. While this was partly our fault because of our line of questioning, the bigger reason was that those we interviewed hadn’t talked about volunteering (though Samaritans and Citizens Advice were exceptions). Their priorities were about jobs and fundraising and their core services. It exposed the unsavoury reality that for many in charities volunteers are a nice extra, but not a core part of what they do or deliver. The NHS Volunteering scheme has exposed how the government thinks that volunteering can be done without management or co-ordination with targets plucked out of thin air. Over 750,000 people volunteered and only 100,000 tasks were requested by early May. What a waste of energy and commitment.

The real success story of volunteering is the grassroots response to the virus where communities unhindered by either government or charities are getting on and supporting the vulnerable and the shielded with self-help groups and schemes.

Digital charities?  Not so much. Charities are about people – up close and personal

We live in a digital world, don’t we?  We are online 24/7. Well, we are, but charities aren’t. They are still a people business, first and foremost. Removing the ability for charities to meet people face to face removes the way they deliver services and the way that much fundraising takes places. People make charity shops happen, as well as run parks, projects, care for animals and delivery of rehabilitation and research. Social distancing has made almost every aspect of charities’ work more difficult. There are lots of people (well mostly digital agencies) who like to say that charities have entered the digital world. No such luck. Charities are about people from start to finish, and Coronavirus has exposed that fundamental truth as a recent CAF survey illustrated.If this crisis changes anything, it is that charities need to work out how to make their services and their mission-delivery driven by digital, into new places. After all, there is a whole new generation of people, even grandparents, who can now do video calls and that experience forced by a lockdown shouldn’t be lost or wasted.

Reserves are meant for a crisis like this

Some charities just love reserves. That nice secure feeling of having a year or two of annual income in the bank for that rainy day. I just hope that charities realise that it’s raining now. Indeed, it’s raining heavily. If a charity won’t use reserves when faced with the biggest economic contraction in 300 years, what kind of disasters are you waiting for? Now is the right time to fund vital services during the difficult times using reserves. Any organisation which doesn’t want to spend its reserves now to keep services going isn’t prudent, but negligent.

We don’t have a plan, let alone a cunning plan

There have been plenty of reviews in recent years about the sector and where it is going: the House of Lords report, the Charity Futures project, the Civil Society Futures review and more besides on tax, governance, fundraising and leadership. But all these reviews haven’t created a plan for the sector which the major sector bodies and the major charities are signed up to. We have no common goals.  So, for all the talk of collaboration, there is little of it when it comes to the most important area of all for collaboration: deciding how to create a better sector. The irony is that the sector is very good at opposing things it doesn’t like, such as lobbying for charity workers to be allowed to volunteer for their own charities. However, when it comes to proposing change, we don’t have a plan, and when it comes to pandemic recovery that inability to agree on common goals may be our greatest weakness of the coming decade.

All of this is pretty gloomy stuff, and that’s mostly because the current situation is pretty gloomy. So how should charities respond individually and collectively? Churchill is reputed to have said ‘never let a good crisis go to waste’. Now is the time for charities to think about how they develop their strategies to be more resilient, leaner, and more effective. Collectively charities need to work out how to work together to make the sector better understood, more influential and more digitally savvy for the years ahead.