We share a recent report from the Centre for Social Justice Foundation, underlining the funding and power imbalance facing small and medium-sized charities, together with some important recommendations for change.

As a charitable foundation that works with hundreds of poverty-fighting grassroots charities we are acutely aware of the pressures and challenges that many of them face. The need for their support is rising, while funding opportunities are disappearing.

The report highlights the widening post-pandemic funding gap between small and large charities, with income for the small charity sector declining by £4.6 billion, compared with an overall £4.5 billion rise for larger charitable organisations. And these smaller charities are increasingly being forced to close – the CSJ Foundation’s report notes that of the 921 charities that have closed so far in 2024, almost all of these (904) have an annual income of less than £1 million.

Read Underfunded and Overlooked, the report from the CSJ Foundation in full here.

A focus on philanthropy

The report also highlights the opportunity to improve the mechanism for philanthropic investments and private donations, stating:

“Much can be done to improve the way philanthropic investments and private donations work, for both donors and charities. Philanthropists and people seeking to donate, are often unaware of the most effective grassroots organisations (sometimes right on their doorstep) and so are not in a position to invest in high-impact grassroots poverty-fighting organisations.”

The report recommends making it easier for potential donors to access the very best small charities and organisations.

Finding those excellent small charities is a real challenge for philanthropists, as we are acutely aware at the Steve Morgan Foundation, as they rarely have the time nor resources for self-promotion. We raise awareness by attending funding events and using social media (and articles such as this) to ensure we can attract funding applications from the widest possible cohort in our regions, but there is always so much more to be done.

Recommendations for addressing the imbalance in the charity sector

The report sets out four key recommendations, which we summarise here:

#1 Local and national government should give due consideration to small and medium-sized charities when making contracting decisions for the provision of social services.

#2 The Government should ringfence a proportion of its charitable grant-making for grassroots charitable organisations.

#3 To stimulate hilanthropic giving , the Government should commit to match funding charitable initiatives. A model for this could be the DCMS Community Match Fund initiative, rolled out during the pandemic. We were involved in this scheme, distributing a total of £20 million to organisations at the forefront of essential service delivery to the most severely impacted communities.

#4 The Government should give an equal voice to smaller charities when it engages with the sector for research and policy making.

Supporting grassroots charities

We know that local, grassroots charities are often the ones best placed to support the most vulnerable in our communities. It is time for policymakers, philanthropists and the charity sector to come together and ensure we can protect these excellent local organisations.

The Steve Morgan Foundation provides a range of grants for organisations that make a positive difference to those in need. Areas of support include poverty, homelessness, health and wellbeing, education and training. We also provide smaller grants to people requiring specialised disability equipment. Find out more about our grants and how to apply.

 

About the CSJ Foundation

The CSJ Foundation was established by the Centre for Social Justice, an independent think-tank that studies the root causes of Britain’s social problems and addresses them by recommending practical, workable policy interventions.  

Sitting in a unique position between frontline charities, philanthropists, and policymakers, the CSJ Foundation describes its mission as being to ‘put social justice at the heart of British philanthropy’ and to ‘revolutionise the way local grass roots charities are seen and funded’.

Visit the Centre for Social Justice here.

The Foundation’s Chairman, Steve Morgan CBE, has been honoured for his outstanding contributions to North Wales communities alongside Wrexham’s Hollywood owners Ryan Reynolds and Rob McElhenney. The three have each received Community Foundation Wales Philanthropy Awards.

The awards recognise and highlight the work of individuals going above and beyond for their local communities and aims to inspire and encourage others to start their philanthropic journey.

The awards were made to mark the charity’s 25^th year.

The Steve Morgan Foundation supports the most vulnerable across North Wales, Cheshire and Merseyside helping to make a positive difference to those in need. We have worked alongside Community Foundation Wales, supporting their Our Communities Together – a cost of living crisis appeal with £25,000 of match funding.

Steve Morgan said: “What a great honour to receive this award from Community Foundation Wales. It’s a special award that is unexpected. Our foundation does tremendous work in north Wales and has done for many, many years, distributing millions of pounds in just the last few years alone. This is all done without looking to be recognised, so when you get something like this, it really means something.”

Upon receiving his award, Steve recorded this video:

 

Since becoming Co-Chairmen of Wrexham Football Club, Rob McElhenney and Ryan Reynolds have supported a number of community projects in local area. When they took over the club in 2020, they pledged to make a positive difference to the local community as well as the football club.

From donating to a charity who provide free caravan holidays to families who may never have had a holiday before due to financial crisis to funding an adapted bathroom for a Wrexham Football Club fan, Ryan Reynolds and Rob McElhenney continue to support and give back to the Wrexham area.

Richard Williams, Chief Executive of Community Foundation Wales said:

“We are delighted to recognise Ryan Reynolds, Rob McElhenney and Steve Morgan for their amazing generosity and commitment to communities in North Wales. They, like us, recognise the wider role of philanthropy in building and strengthening Welsh communities.

These philanthropy awards are part of our 25th birthday celebrations which also sees the relaunch of our Fund for Wales, which provides grants to local, grassroots organisations and charities who are embedded in their local communities.

We hope that people will be inspired by Ryan Reynolds, Rob McElhenney and Steve Morgan to give back to their local communities and a donation to Fund for Wales would be a great way to start.”

Since 1999, Community Foundation Wales have awarded over £40m in grants across Wales, playing a key role in matching philanthropy to grassroots community groups and charities making a difference in their local communities.

Their Fund for Wales supports small, volunteer-driven community organisations with grants of between £500 – £2,000 towards the following areas:

• Improving people’s chances in life
• Building stronger communities
• Improving rural and urban environments
• Encouraging healthier and more active people and communities
• Preserving heritage and culture