Where do voluntary organisations get their money from?

Overview

  • In 2018/19, voluntary sector income was £56bn, which was made in different ways from a variety of sources.
  • The largest source was the public, which counted for £27.1bn or 48% of all income in 2018/19. This includes voluntary income such as donations and legacies, and income earned in different ways including trading such as charity shops and membership fees.
  • This was followed by government at £15.8bn or 28% of the total including funding like grants, public service contracts and fees for services provided by charities.
  • Other sources include the voluntary sector with £5.1bn (9%), investments at £4.7bn (8%) and National Lottery with £0.5bn (1%).

Almost half of voluntary sector income is from the public – the largest source – followed by more than a quarter from the government

Over time

  • The overall increase in voluntary sector income since the previous year was driven by income from the public and investment – the vast majority driven by major organisations.
  • From 2017/18 to 2018/19, income from the public increased from £26.2bn to £27.1bn or 3.5%. Since 2000/01, total income from public increased by 83% – higher than the 60% rise for all income during this time. As a proportion of all income, it increased from 42% to 48%.
  • Investment income rose from 2017/18 to 2018/19 from £4.2bn to £4.7bn or 12.3%.
  • Income from the government declined from £16.2bn to £15.8bn or 2.1% since the previous year. Having peaked at £17.6bn or 37% of voluntary sector income in 2009/10, after a significant decline this source has remained largely stable since 2015/16.
  • National Lottery income fell since the previous year from £593m to £471m or 21%, reflecting a trajectory of long-term decline (49% since 2000/01).

Income from the public and investment have increased since the previous year while all other sources have declined

By type

  • There are three ways in which voluntary organisations can generate income:
  • voluntary which includes donations, grants or sponsorship
  • earned which includes income generated through contracts, membership fees or charity shops, but also fundraising activities like bake sales or raffles
  • from investments.

Voluntary sector income is mostly earned (47%) and voluntary (44%), with investments being much smaller (8%).

Earned income has increased slightly by 2% since 2017/18, voluntary income has seen a slight decrease of 1% and investment had a significant increase of 12%. This increase in investment can be mostly attributed to major organisations (47% increase since 2017/18).

The sector’s income is almost entirely made up of earned and voluntary income

By size

  • Micro and small organisations received the largest proportion of income from the public by size – 63% of their total income. While super-major organisations’ largest source of income was also the public, as a proportion this was much less with 45%, which was closer to major (48%), large (50%) and medium (48%).
  • Larger organisations rely on a greater proportion of income from the government, with all other size categories receiving at least double the proportion of micro and small (12%). Major organisations were the largest by proportion and amount, receiving a third (34%) of their income or £6.1bn from government compared to 26% or £3.3bn for super-major.
  • Super-major organisations also received the highest proportion of income from the voluntary sector (16%) compared to 7 to 10% for others.
  • Micro and small organisations also received the largest share of income from investment (17%) – almost triple that for major (6%) and super-major (7%) although a fraction of the monetary amount.

Micro and small organisations receive a larger share income from the public than larger ones.

By subsector

  • Income from the public made up more than half of income for ten out of 18 subsectors and over 70% for environmental organisations (73%) and parent-teacher associations (71%).
  • The government made up from two fifths to more than half of all income for some subsectors including employment and training organisations (57%), playgroups and nurseries (45%), law and advocacy (44%), social services (43%) and umbrella bodies (41%).
  • Development and international organisations were more evenly split, receiving 34% and 31% respectively from the public and 30% and 25% from the government. Development sourced 20% of income from the private sector while international gained 33% from the voluntary sector.
  • Grant-making foundations and research organisations received a higher proportion of their total income from investments (28% and 21% respectively) than other organisations (2-15%).

Environmental and parent-teacher organisations depend on the public for more than 70% of their income

Majority funding source

  • Income sources can also be explored by looking at the majority funding source for individual organisations. We define majority funding source as more than 50% of all income for an organisation coming from one single source.
  • More than half (55%) of all voluntary organisations receive more than 50% of their income from the public. Government is the majority income source for only 6% of organisations.
  • Investment was the majority income source for 23% of all organisations, for which most of these were micro and small.
  • Donations are the majority income source for 24% of all organisations, the same proportion as providing services to the public. Trading with the public is the majority income source for 14% of organisations.
  • About one in 10 (29%) of organisations do not have a majority income source.

The majority of funding for more than half of all voluntary organisations comes from the public

More data and research

Notes and definitions

Voluntary sector income can be broken down and analysed in different ways.

  • There are two main types of voluntary sector income: earned income and voluntary income.
  • These income types come from five main sources: individuals, government, the voluntary sector, the private sector and the National Lottery.
  • In addition, there is investment income, generated from investments and cash balances.