Irish not-for-profits increase fundraised income to €845 million in 2014 in spite of charity scandals
Ireland’s per capita charitable giving half that of U.K. and ¼ of the U.S.
Personal tax incentives to give, a giving culture and mandatory transparency needed in Ireland
8th November 2016 - The total amount of charitable giving to Irish not-for-profits in 2014 came to €845 million according to a major new report published today by not-for-profit advisors 2into3 and supported by leading accounting and advisory firm Mazars.
The Irish Not-for-Profit Sector: Fundraising Performance Report 2016 is based on analysis of the 2014 accounts of nearly 1,000 not-for-profits. It provides a detailed overview of the sector and includes insights into the organisations’ activities and experiences, especially in relation to fundraising.
The report’s key findings include:
- The sector increased the amount of income it earned from fundraising by 7% between 2013 and 2014, in spite of several high-profile scandals affecting the sector.
- Ireland’s per capita giving is €183; half that of the UK and four times less than the U.S.
- Ireland’s tax incentive to give is at odd with practically all developed economies.
- State funding accounted for 43% of total sector income.
Other findings are:
- Education is the largest not-for-profit sector making up 26% of the total size of the sector.
- Health has the largest income accounting for 28% of all not-for-profit income.
- The majority of organisations in the sector are extremely small – 50% have an income of less than €100,000.
- Most not-for-profits have few paid staff – 63% employ less than five people.
- The majority of fundraised income is raised through “relationships” including “regular giving” and “direct marketing appeals.”
- The average cost of fundraising is 30c per €1 raised.
- Legacies, corporate donations, major gifts and emergency appeal are the most cost effective fundraising methods.
- Selling items and fundraising events are the least cost effective fundraising techniques.
Dennis O’Connor, Director of 2into3, said: “We know relatively little about the day-to-day realities faced by the not-for-profit sector and this report aims to bridge that gap. It provides an insight into the composition of the sector and, in particular, fundraising, performance and cost.”
“Since 2014 there has been better regulation of the sector and increased transparency. This is to be warmly welcomed.”
“We found that fundraised income in 2014 increased for the fifth consecutive year. It appears that the charity scandals of 2014 did not negatively impact on this. Anecdotally, we also know that this trend has continued on in to 2015 and 2016.”
“Having said that, more must be done by both the State and the public to support the not-for-profit sector.”
“Irish Philanthropy or charitable giving is significantly lower, per capita and as a proportion of GDP, than the U.K. It is not unreasonable for Ireland to achieve a further €874 million each year. This would bring us in line with U.K. levels and would make a considerable impact to support those in need. It is a goal very worthy of pursuing.”
Also speaking at the launch was Mairéad Divilly, Partner, Mazars commented: “While the improved regulation that the sector is seeing is to be welcomed, there is a good argument for making the publication of annual reports and financial statements mandatory for all not-for-profits. As the sector continues to face regular stories of mismanagement and poor governance, surely now is the time to consider making SORP (or an equivalent) and the Governance Code mandatory for all charitable organisations in receipt of public funding.”
2into3 are Ireland's specialist advisors and capacity builders for the not-for-profit sector. Since 2006 2into3 have assisted a wide range of not-for-profits by providing consulting, recruitment, research and capacity building services. 2into3 provides a Quarterly Fundraising Monitor service offering subscribed organisations with frequent and comprehensive information on Ireland’s fundraising landscape.
Mazars is recognised as a leading provider of audit, consultancy and taxation services both in Ireland and internationally. They provide audit, assurance and other professional services to many organisations in the charitable and not for profit sector. Mazars’ team of professionals has provided guidance to charity clients on best practice financial reporting, the transition to Charities SORP and the adoption of the Governance Code. They also run regular training courses, seminars and public lectures on Charities SORP and the Governance Code. www.mazars.ie