The UK's voluntary sector is facing a perfect storm of financial strain and a critical shortage of key volunteers, with experts warning that a decline in charity trustees is amplifying systemic problems. This comes amid intense pressure from funders and skyrocketing demand for essential services.
Funding Demands Distort Charity Priorities
While charities are not driven by profit, research highlighted by academics Linda Milbourne of Birkbeck, University of London, and Mike Cushman of the London School of Economics reveals their missions are frequently distorted by funders' requirements. In a target-driven environment, charities must shape their project bids to meet the performance indicators of state, corporate, or charitable funders, often at the expense of local community needs.
This mismatch means charities struggle to access funding for core running costs or the expressed needs of their users. The resulting services can be less effective, eroding trust as communities perceive charities acting in the interests of funders rather than as their advocates. This conflict places considerable stress on both managers and trustees.
Trustee Exodus Threatens Governance and Funding
Compounding these issues is a worrying drop in individuals volunteering as trustees. After seven years in the role, Ben Norman from London is stepping down, citing the increasing drain of providing necessary support and challenge to executives during financially straitened times. He notes a significant difficulty in finding a pipeline of suitable volunteers willing to join unpaid boards.
Good governance is fundamental to securing donor trust, and a hollowing-out of able trustees leaves charities more vulnerable to funding cuts and may result in poorer oversight of dwindling resources.
Advice Services at Breaking Point
One sector facing immediate crisis is free, independent advice charities. Sarah MacFadyen, Head of Policy at AdviceUK, warns these vital services are under unprecedented strain due to chronic underfunding, staff shortages, and soaring demand driven by the cost-of-living crisis.
Alarming data shows demand for advice in 2024–25 is 40% higher than the 2018–22 average. Furthermore, 88% of organisations report major recruitment difficulties, and only one in ten feels confident about operating beyond the next year. AdviceUK urges a national workforce strategy, noting that every £1 invested in advice saves around £2.70 in wider public costs by preventing crises from escalating into the NHS and courts.
Calls for Systemic Change
Professor Mike Stein from the University of York points to the complex state-charity relationship, exemplified by the reliance on charities for basics like food and heating following cuts to universal benefits. He argues the challenge is to restore the principle of state entitlement.
The collective message from sector voices is clear: without addressing the twin crises of distorted funding and a volunteer governance shortage, the UK's charitable infrastructure risks being unable to support the millions who depend on it.
