Leading experts have issued a stark warning that LGBTQ+ charities across the United Kingdom are now operating in a newly 'hostile environment', with a sharp decline in corporate donations creating a severe financial crisis for the sector.
Stonewall's Funding Halved Amid Global Backlash
The scale of the challenge is crystallised in the latest accounts from Stonewall, the UK's most prominent LGBTQ+ charity. The figures reveal that corporate donations to the organisation more than halved in the last financial year, plummeting from £348,636 in 2024 to just £143,149 in 2025. The charity's total income fell from £6.9 million to £4.7 million over the same period.
Heather Paterson, head of partnerships for the LGBT+ Consortium, an umbrella support group, stated that this is an 'incredibly tough environment' for all organisations in the sector. She highlighted research showing that LGBTQ+ causes receive a mere 10p for every £100 donated to UK voluntary groups annually.
The Ripple Effect from the US and Legal Threats
Experts directly link the funding freeze to the political climate in the United States. The executive orders from President Donald Trump that scrapped Diversity, Equity, and Inclusion (DEI) programmes at a federal level and froze foreign aid for LGBTQ+ initiatives have had a undeniable chilling effect on UK fundraising.
Alex Farrow, head of the Kaleidoscope Trust, described the loss of international funding as 'devastating', noting that UK-based global businesses are pulling back to protect commercial relationships in the US. 'I saw less money coming from corporates in the UK last year than I have in previous years,' Farrow confirmed.
This financial pressure is compounded by a rise in legal threats. Following the UK Supreme Court's April ruling on biological sex, charities like Girlguiding UK have faced legal challenges over their trans-inclusive policies. 'The majority of the sector are small, grassroots organisations, which are especially vulnerable to threats of costly legal action,' Paterson explained.
A Wider Sector in Crisis
While Stonewall's struggles have drawn significant attention, sector insiders stress this is a far broader crisis. One source with multiple trustee roles emphasised that the story is 'much bigger than Stonewall', with firms across the UK cutting DEI training budgets and sponsors withdrawing support.
Corporate nervousness is palpable. Paterson reported that some companies are reassessing their funding choices in a political landscape where supporting transgender causes is seen as controversial. Funders themselves are reportedly receiving increasing negative feedback for donating to LGBTQ+ organisations.
This corporate retreat was evidenced last month, as the Guardian revealed the UK's largest businesses were scaling back public support for Pride events, mirroring a trend seen in the US. Stonewall, in a statement, acknowledged the 'significant turbulence' facing the global LGBTQ+ movement, including a pushback on rights and freedoms.
Farrow summarised the profound shift, stating: 'As a LGBTQ+ charity leader, it’s a huge concern because we are operating in a hostile environment that is significantly worse than even five years ago.' The combination of evaporated funding, rising operational costs, and intensified opposition has created a perfect storm, threatening the vital support these charities provide.
