Wednesday, May 6, 2009

do we really need another 5,000 charities?

I came across a sobering statistic recently - in 2008, there were 5,000 new charities created. That's roughly 1 new charity every 3 hours (allowing for weekends, Bank Holidays and tea breaks).

And it got me thinking about other statistics and 'headlines' in the third sector - about the difficulty existing groups have in attracting approriate trustees, about the increasing competition for dimishing grants, and about the growing bureaucractic overhead of mandatory reporting requirements that charities must comply with.
Surely, given all that, do we really need so many more additional charities when it must be better to combine forces, to collaborate more, and even dare I say, look to merge activies where they could be seen to make savings and so offer greater support and impact to the communities that charities are created to benefit.
Could it be then that the founders of charities aren't always as altrusitic as we might believe - perhaps more people than we'd care to admit like to feel that only they can solve particular issues in their own special way, and that to do so they need to control all aspects of their own projects, because they think that no-one else sees the world in quite the same way they do - "vanity, vanity, all is vanity...";
Or maybe its more to do with the legislation - after all, charities have to be very specific about what they do, who they do it to, where they do it to them (much more so than companies), and so as communities change, are existing charities unable to continue to meet these changing and evolving needs and so new charities are needing to be created to continue the work that charity legislation would otherwise prevent them from doing?
Or maybe... or maybe there's some really obvious and rational explanation that someone can share with me and others using the comments button below.

either way, I think most people would be shocked at this statistic...
(for comparison, in the same period there were 814 new Community Interest Companies)


  1. there's now a continuation of this argument based on a paper by the New Philanthropy Capital and reported on by the Guardian -

  2. Hi Adrian - picked up your comment on the RSA board. Does seem like a lot doesn't it! From my own perspective I set up and ran a CIC for a couple of years. We were one of the first to register and it seemed a perfect model for what we wanted to do. That is until we set about trying to apply for funds. I spoke at an event with the then CIC Regulator and mentioned this and he responded that it was an issue they were aiming to tackle.

    I'm now setting up a new 'social enterprise' and going through the process all over again - what kind of governance do we want, what are the limitations and advantages of the various structures etc. and so far as I can tell not much has changed. This time we've registered as a Company limited by Guarantee but with the original intent to take on the new charitable incorporated model - which has now been put back. So right now we're again in the situation of not wanting to register as both a company and a charity but being excluded from applying to many funds we would otherwise be ideal for because we are not a registered charity.

    There are just too many models, and of them all the Registered Charity perhaps has the most credibility. As for CIC's I can still remember the look on our accountants face, followed by a 'why would anybody choose to become one of these?' question. It's a reaction I've learned from.