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How will Brexit affect the charity sector?

Posted by: Roisin Evans 24 Apr 17  | Current Issues

With Theresa Mays’ announcement yesterday that there will be a snap election on the 9th June 2017, it brings further uncertainty of what life will be like post-Brexit.

Sir Stuart Etherington, who spoke at the NVCO’s conference this week recently voiced concerns over the evident lack of presence charities had leading up to the referendum and how this will affect the deal that charities are ultimately left with.

Since the Brexit negotiations have been put into motion, Etherington is now urging charity leaders to act and stand up with confidence to identify what they require from Britain’s settlement deal in order to flourish post-Brexit.

How will the UK be affected?

According to a stronger charities for a stronger society report, UK charities receive approximately £200 million from the European Union every year, via the European Structural and Investment Fund (ESIF) and the European Social Fund (ESF). At this point it is still unclear how much funding will be lost as a result of Brexit.

While it remains uncertain how charities will be overall effected, experts believe that well established charities are in a good stance to overcome any speed bumps Brexit might bring. However, experts are warning that it will be small charities and medical charities hit hardest by our European Departure. Small charities will lose vital grants and medical research is said to take a hit through loss of funding and opportunities for collaboration with other entities.

Further to this, leaders have suggested that it’s not just the financial impact charities need to be concerned about. Potential policy changes mean that other areas such as refugees and asylum seekers, the environment, human rights, tax, VAT and fundraising across EU member states could also affect charities work. Although, some reassurance can be found in the fact that legislation surrounding charities in all local areas will remain unchanged for the foreseeable future at least.

Post referendum effect so far

So far the immense shock that Brexit has brought, seems to have left the voluntary sector relatively unscathed with donations staying at a healthy amount of £9.7 billion over the last year alone.  

Some may even say that the announcement of the Brexit results has actually brought on a positive effect for the third sector. Since the announcement of results according to an annual UK Giving report there has been a sharp increase of up to 89% in people saying that they contributed to charity. People are definitely showing more of an interest in their chosen causes; as over 50% of people said they signed petition in 2016 and 3 million attended a demonstration.

This begs the question, could Brexit be the driving force behind a higher rate of public participation with charitable organisations?

Planning and preparation for post Brexit

A report commissioned by Lloyds bank foundation has identified the top challenges charities are likely to face in the year head. Here are some hints and tips to ensure its smooth sailing for your charity through post Brexit life.

1)      Planning process: failure to plan ahead is detrimental to future success of your charity. Conduct a SWOT analysis or take advantage of diagnostic tools that are available in the market.

2)      Is it necessary: less funding post Brexit will ultimately put pressure on your activities. NVCO have designed a Mission/Money Matrix to help you better manager your money.

3)      Innovation: creating new  and versatile ideas to generate money is essential for charities to stay ahead post Brexit.

4)      Collaboration: This will be beneficial for small charities hit by funding cuts. By collaborating with others, you can share resources and ideas, keeping ahead in the market.


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