'It's a bear pit': Exploring how UK-based grassroots charities experience the cost-of-living crisis

• In Event: Collaborative Governance for Systems Change

Abstract

Within the UK, the impact and effect of the latest global economic crisis have been particularly difficult: decades of underinvestment and cuts to essential public, social, and welfare provisions, years of austerity policies, post-Brexit supply-chain disruptions, combined with a struggling energy market have led to a major national cost-of-living crisis (COLC). This is defined as the fall in real disposable incomes - adjusted for inflation and after taxes and benefits - against an increase in prices (Hourston, 2022; Webster and Neal 2022; Broadbent et al 2023). The impact has been particularly bad for low-income individuals, families, and communities, the majority of whom have been left in dire straits (Etherington et al 2022; England et al 2022; Williams and Dienes 2022). While to-date much of the COLC literature has explored the impact on individual households and the accompanying increasing demand for local services, the impact on grassroots charities that provide vital services and aid to households in these communities has seen limited attention. Our paper addresses this empirical gap and examines how the COLC has affected the organisational capacity of grassroots charities to meet increased demand in the UK.

In line with calls for more ‘engaged scholarship’ (Hambelton 2011) and 'research co-production' (Martin, 2010), where academic researchers and practitioners actively collaborative to address pressing social issues, this work is a joint undertaking between a major UK grantmaking foundation and a university-based philanthropy research centre. Using quantitative and qualitative data collected in two separate surveys conducted by the foundation through its 1500+ member strong network of grassroots beneficiaries, and using a thematic data analysis approach, we explore to what extent fundraising efforts, running costs, staff retention, and emergency priorities have been affected by the COLC.

The findings show that the COLC has negatively impacted grassroots charities’ organizational capacity to serve their respective beneficiaries: charities are struggling to staff their organizations, keep talent on, pay their electricity bills, and secure the long-term funding needed to survive high costs and their increased levels of demand, with numbers getting worse over time. Examining the data, we find that the COLC amounts to ‘a bi-directional relationship’ between the struggling organizational capacity and increased levels of local demand, as both affect the other: aid recipients are struggling because their local charities are not working with strong organizational capacity. Conversely, organizations’ capacity is increasingly limited because of high levels of demand of aid in communities. Expanding the empirical knowledge-base, our paper first of all shows how charities are facing the COLC are entangled within a cycle that keeps charities (and the communities they serve) starved, and how, more broadly, multiple crises interact with one another. We use these insights to critical reflect on, and update and expand, the notion of the nonprofit starvation cycle (Gregory & Howard, 2009), and offer policy guidance and practical pointers to grantmaking foundations on how they can incorporate these insights into their funding strategies.

References

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Authors

• Janis Thomas Petzinger, University of St Andrews

• Tobias Jung, University of St Andrews

• caroline broadhurst, The Rank Foundation