The sector in 2023 – key stats

Analysis of Charity Commission data and survey results revealed interesting findings on the size, focus and resources of the sector, including:

• The refugee and migration sector includes registered charities, other formally constituted not-for-profit organisations, a wide range of voluntary and community-based organisations, and international organisations.
• There has been an increase of 137 new charities (24%) established between 2020 to 2022 which work on refugee and migration issues.
• Funding to the sector increased significantly (51%) between 2020 and 2022 – largely due to emergency funding in response to Covid-19. However there are concerns about whether this funding level can and will be sustained.
• Resources to the sector are heavily concentrated in large organisations. In fact just 3% of charities in the core sector control 44% of the funding.
• NGOs remain largely dependent on trusts and foundations for funding.

The sector in 2023 – key priorities

Drawing from interviews and consultation workshops, the report presents deeper analysis and suggested actions around six key priority areas:

Adapting to external challenges and crises

Funding for more systematic and strategic collaboration, including horizon scanning, shared funding infrastructure and legal advice, can strengthen our power to go beyond rapid response.

Financial sustainability and funding

By investing more in those doing ground-breaking work where the need is great, independent funders could spread their support more equally. A shared approach to growing the overall funding pot would also help build a solid foundation for the future.

Racial justice, power and lived experience

Real change will only happen when those with power reflect deeply on the lasting impact of colonialism and racial injustice, and start distributing resources differently. Additionally, involving people with lived experience of migration is a vital step towards achieving fundamental, inclusive and collective change.

Employee wellbeing and leadership

By urgently investing in collective care, leadership development, and fair work and pay policies, people will feel safe and protected.

Influencing and campaigning

To prepare for the 2024 General Election, we can benefit from building wider alliances that link frontline expertise with political influence and power.

Alliances and collaboration

Solidarity with people on the move is the bond that connects organisations across our sector. But we need more time and new opportunities to deepen collaborations and broaden our alliances. By pooling our power and expertise we can present a united front on the issues that matter most, and create a better future for everyone.

The Funders for Race Equality Alliance is a growing network of charitable funders determined to take action to tackle racial inequity and injustice. Now with 45 members and counting, the network provides space for challenge, knowledge exchange and peer support, helping us to review the extent to which we are funding racial justice. The Alliance also tests new ways of providing, in the words of the network’s mission, ‘more and better’ funding to organisations led by and for people affected by racial inequity. Read more about the Alliance (pdf)

To help funders understand where their grants are going, and to provide a baseline against which to measure change, the Alliance developed an audit tool which can be used by funders of any size, type or specialism to analyse the extent to which their grants are supporting the race equality sector and furthering racial justice. In May 2021 we published the pooled results from the pioneers who tested the audit tool, and we have now added those from the second cohort.

The first cohort included a variety of charitable funders, including social justice funders such as the Joseph Rowntree Charitable Trust and Barrow Cadbury Trust, a community and place-based funder, – Bedfordshire and Luton Community Foundations – as well as some bigger foundations including Esmée Fairbairn, Paul Hamlyn and Lloyds Bank Foundation.

The second cohort includes the National Lottery Community Fund, Henry Smith Charity and the People’s Health Trust, amongst others, illustrating the significant uptake of the audit tool amongst a wide spectrum of charitable funders.

Here are the results from both cohorts, which have been combined to reduce biases and give a better overall picture of where funding is going.

Racial justice funding over time

There are some notable differences in the results from the two cohorts. In the first, almost a quarter of the total grant funding provided was designed to benefit Black, Asian and Minority Ethnic groups, compared to only a tenth from the second. Interestingly though, the proportion of funding allocated to organisations led by Black, Asian and Minority Ethnic communities was almost identical – 6% in the first cohort versus 5% in the second.

These figures are both much lower than we’d expect if funding were to be equitably distributed across the whole voluntary and community sector.

The second big difference is the amount of funding going to the race equality sector for service provision compared to campaigning and influencing work. Almost 80% of the funding in the second cohort went to race equality organisations for provision of direct services, compared to less than half in the first cohort. However, a very different pattern was found when we looked at campaigning and influencing work – almost a fifth of grant funding in the first cohort was given to support campaigning with a full half devoted to work aimed at creating structural change, but the funders in the second cohort spent less than 1% on this work.

The pattern will partly be due to timing – the second cohort analysed their grants during or after the big push to provide crisis grants given to help people through the Covid-19 crisis – but the second cohort may also be more typical of the foundation sector as a whole, which tends to fund much more service provision than work that directly addresses the root causes of racial injustice.

Funders are changing their grant-making practice

It’s clear that funders are eager to understand their grant-making better. Twenty funders have shared their data with us, representing more than 3,000 grants totalling £270 million, and we know others have undertaken the audit for internal purposes only. It’s clear that their findings are helping them to think and fund differently.

For example, Lloyds Foundation identified barriers to organisations led by racially minoritised groups and introduced a 25% ringfenced fund in August 2020 for Black, Asian and Minority Ethnic-led charities. Its evaluation of that fund showed that it had exceeded that target, with 38% going to those organisations.

When Trust for London audited its grants, it found that while 70% of its funding would benefit racially minoritised people, only 14% went to organisations led by people from those communities. Subsequently, they are now working up plans to make a significant investment to Black, Asian and Minority Ethnic-led organisations to increase their skills, capacity and policy influencing activities in tackling racial injustice. And the Smallwood Trust has also changed its processes and has seen its funding for the sector increase from 7% to 21% across its portfolio.

The audit has led to wider changes too: Esmée Fairbairn Foundation and the National Lottery Community Fund supported 360Giving and the Social Investment Consultancy to develop a Diversity, Equity and Inclusion data standard for 360Giving. This will pave the way for consistent data collection that all grant makers can use and which covers all protected characteristics. We hope this will lead to more consistent reporting, greater accountability and lasting change.

Looking to the future

Now that the audit is well established, the Alliance will be publishing pooled data on a regular basis. Since these first two cohorts, we have revised our racial justice audit tool to integrate it with 360Giving’s new DEI Data Standard and to update our language and terminology around communities experiencing racial inequity. This revised tool will be published shortly.

We are confident that the changes funders have made in the aftermath of George Floyd’s murder, the resurgence of Black Lives Matter and the stark and long-standing inequalities brought to light by Covid-19 will show up the next time we publish audit figures. But funding behaviours and priorities have so far been reactive – we cannot continue to only fund the sector in times of recognised injustice and allow the momentum for change to seep away in the coming years. We are asking for all members of the Funders for Race Equality Alliance to commit to auditing their grant making at least every two years, to ensure a steady shift towards equity.

If you want to find out more about the Alliance or get support with undertaking the audit, please contact the Alliance Secretariat. We look forward to you joining us!

The public wave of sympathy in response to the refugee crisis has led to an increase in the number of people looking to volunteer.   One of the aims of this fund is to help groups build their capacity to process these offers of assistance. This is especially important at a time where demand is rising and groups are working with larger numbers of people who have been through traumatic experiences.

The New Beginnings Fund has been contributed to by a number of leading charities including Paul Hamlyn Foundation, Pears Foundation, The Rayne Foundation, Lloyds Bank Foundation for England and Wales, and Comic Relief.

The fund will be disbursed through UK Community Foundations’ (UKCF) network of local community foundations.  The application process will be managed across the four nations of the UK by: Community Foundations for Lancashire & Merseyside, Community Foundation in Wales, Community Foundation Northern Ireland, Foundation Scotland, Heart of England Community Foundation, Kent Community Foundation and London Community Foundation.

The fund is aimed at small, local groups.  Those groups with an income of less than £250,000 will be prioritised. Applications for up to £10,000 will be considered but, in exceptional circumstances, grants for up to £20,000 will be awarded for collaborative bids involving multiple local partners.

The funding can be used for new or existing activities that involve local communities in welcoming and supporting new arrivals. A key view of this fund is that early integration helps dispel tensions and prevent misconceptions within local communities. Applications from projects which emphasise the value of integration and work with communities to become stronger and more connected, encouraging refugees and asylum seekers to make an active contribution and engage positively, will be welcome.

If other organisations are interested in contributing to the New Beginnings Fund, they should contact UKCF for further information.

Applications can be submitted up to 29 March 2016 following a six week application window. Application forms can be found on the UK Community Foundations Website as well as on the website of each participating community foundation.

[1] Home Office National Statistics: Asylum https://www.gov.uk/government/publications/immigration-statistics-april-to-june-2015/asylum

The report was launched with a discussion of key findings and a practitioner perspective and is the first edition of a new series of research briefings.  Building on the track record of its companion ‘Family Foundation Giving Trends’ the briefings will reveal key data about the vast majority of trust and foundation giving in the UK.  Although there are roughly 10,000 foundations in the UK the top 300 account for 90% of the value of all their giving.

The report reveals that foundation giving to charitable causes grew by £271 million, or 10%, whilst income fell by the same amount. This “unprecedented finding” highlights the importance of foundation assets, which have enabled several larger foundations to fund ‘counter-cyclically’ through a time of elevated need and reduced government expenditure. However, such spending decisions have been made at a time of low investment returns, intensifying the pressure on trustees to balance today’s pressing issues with maintaining their spending power for future generations.