Demand for 3rd sector services rises despite funding pressures

Infographic about the Ulster Bank and CO3 3rd Sector Index Q2 2016

The latest Ulster Bank & CO3 3rd Sector Index is released this morning. It is a survey of leaders of bodies such as social enterprises, charities, and community organisations.

Amongst its key findings are that:

  • Almost one-third (29 percent) experienced a further decline in government funding
  • A further 59 percent said that they experienced no change, which equates to a real-terms decline.
  • One-in-four said their organisation is vulnerable to cash-flow issues
  • 65 percent saw demand for their services increase
  • 23 percent say their organisation increased headcount

The challenging environment and the impact on some organisations is clear to see. But many organisations are actually seeing demand for their services grow and are able to increase their headcount.

Some of the rising demand is no doubt being driven by need, resulting from, for instance, public sector cuts and enquiries about changes to the benefit system. However, there are also organisations who are becoming increasingly entrepreneurial, diversifying their service offering, and entering new markets.

The challenge for the sector as a whole is to continue to adapt and to find new streams of revenue.

This is particularly the case with a question mark now hanging over EU funding in the future. Three-quarters of respondents had previously identified the Referendum as something that concerned them, and with a ‘leave’ vote having come to pass, there is now a real need for third sector leaders to envisage and contingency plan for a future without EU cash.

As Nora Smith, chief executive of CO3, says: “Cuts in government funding, cashflow concerns and an increase in demand for services all point to a challenging environment for third sector leaders. Subsequently, Brexit compounds this uncertainty, and our engagement with our members tells us that the significant majority see it as a negative thing for their organisation. Whilst there is an understandable concern of the unknown, we are a resilient and dynamic sector, used to dealing with challenge, change and uncertainty. Moving forward it is central that we work in partnership with our political leaders and the NI Executive to ensure that the services and work provided by of our sector are protected.”

About the survey

The Ulster Bank & CO3 3rd Sector Index is a barometer of Northern Ireland’s third sector, involving a quarterly survey of CO3 members who include the leaders of some of Northern Ireland’s largest charities and social enterprises through to small community groups. The survey is sponsored by Ulster Bank and carried out by Perceptive Insight, based on an online survey of over 200 Chief Executives of third sector organisations. The survey was carried out before the EU Referendum vote of 23rd June.

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