voluntary organisations, social enterprises and volunteering
voluntary organisations, social enterprises and volunteering
voluntary organisations, social enterprises and volunteering
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Scottish Third Sector Tracker shows sector under pressure amid costs crisis
Created: 28/08/2024
News/Events Category: General News
The Scottish Third Sector Tracker has outlined some of the challenges community organisations and others are facing as resources become scarcer and costs continue to rise.
Challenges
Carried out by Scottish Council for Voluntary Organisations (SCVO), the survey of almost 400 organisations found that rising costs and inflation continue to present significant challenges, along with volunteer shortages, difficulties in fundraising and cash flow, and overall uncertainty about the future.
Almost two-thirds (61%) of organisations report that rising costs are having a negative impact on their ability to deliver their services or activities. The costs contributing the most include staffing and energy costs.
Six in ten organisations felt the resulting pressure to replace key grant funding by use of their cash reserves was unsustainable, up from four in ten just six months earlier, and the number of organisations making redundancies has doubled, from 5% to 10% in the same period.
Other issues raised include the inability to meet the demand for services, staff recruitment and retention, and issues around grant making.
Demand for service
The main difficulties in meeting this demand included staff capacity (54%); raising funds to meet the demand (50%) and volunteer capacity, (41%.).
Staff
Just under half of organisations that employ paid staff said that they had had difficulties recruiting or retaining staff, with those reporting difficulties with recruitment attributing it largely to a low number of applicants with required skills.
The percentage of organisations recruiting new staff had fallen from a half of organisations in the four months to December to a third of organisations since December. Concerningly, the number of organisations reporting that they had made one or more members of staff redundant had doubled from five to ten percent.
Grant-making
Respondents stated that good grant management included flexibility, clear communications, transparency, timely payments, ongoing support and relationships, and a good understanding of the sector and the specific challenges faced by different types of organisations, e.g. small and rural organisations.
Improvements required for grants were cited as the frequency and deadlines for reporting, proportionate reporting based on grant size, flexible and adaptable reporting, feedback on reporting, reducing duplication and simplification and standardisation.
Climate resilience
Forty-one percent of respondents expect climate change to have a moderate or severe impact on their organisation, whereas 54% expect a small or no impact. Of those who believed climate change would have an impact, 80% believe it will be important for their organisation to be able to adapt to and/or build resilience to the potential impacts.
What's next?
Many organisations are having to adapt to continue to deliver services, including adapting or reducing services in some areas, increasing fundraising and staff restructuring (including redundancies). Demand for services continues to be high, with an increasing number of organisations struggling to meet this demand.
For many, it will feel like the sector is facing a critical moment. Organisations are using their knowledge and expertise about their communities to support some of the most vulnerable in our society. Securing sustainability for this work is crucial, because without it the negative effects on people’s quality of life, and ultimately increased pressure on public sector budgets as a result, are significant.
Click here to read the report in full.
What now?
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