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Author: Third Sector - thirdsector.co.uk
Published on 08 July 2011 12:00 PM

Charities Aid Foundation research finds average spend per £1 raised is 12p, but the public thinks the figure is 42p

Charities spend much less on fundraising then the public thinks, new research by the Charities Aid Foundation indicates.

CAF asked more than 1,000 UK residents how much they thought charities spent to raise £1. The average came out as 42p.

Analysis by CAF of data from more than 162,000 charities showed the actual figure spent by charities is 12p to raise £1.

Richard Harrison, director of research at CAF, said the results showed "the huge gulf that exists between the perceptions of charity fundraising and the reality.

"We have seen the creation of an urban myth about the efficiency of charities – people think that most of the pennies in a pound don’t go to the charity," said Harrison, who blamed media coverage and a lack of understanding of charities for the misperception.

When people were asked how much charities should be spending to raise a pound, the average came out as 26p – more than double the actual figure.

Jay Kennedy, head of policy at the Directory of Social Change, said that although it was broadly very positive to have robust information about fundraising costs, there was "no magic number" and lower fundraising costs were not necessarily better.

"You can’t fundraise out of thin air, and the idea that administrative costs are not helping the end cause is erroneous," he said.

Kennedy said all charities were different and the most important factor was how a charity justified and explained what it did with its money in its reporting, he said.

The cost of fundraising a pound was 10p in 2007 and 2008, according to an analysis of 162,500 charities’ data from their annual returns, held on CAF’s Charity Trends website, but this increased by 2p in 2009.

CAF said inflation and the fall in donations meant charities are having to spend more on fundraising.

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