Now even charities can't rely on charity

A FINANCIAL crisis has hit the Imperial Cancer Research Fund, one of Britain's largest and most admired charities. Its annual income from legacies has dropped by pounds 2m, and it is to close some of its most prestigious centres, including the research unit specialising in children's cancers and cancers of the brain, at the Royal Frenchay Hospital, Bristol.

According to Michael Brophy, executive director of the Charities Aid Fund, the ICRF is not alone in struggling to make ends meet. Although more of us are giving, - 81 per cent of adults are making a donation at least once a month compared with 78 per cent in other years - we are giving less: last year the median monthly donation was pounds 2.50, compared with pounds 3 a year earlier. The CAF says that 'individual giving other than legacies' is down from about pounds 5.5bn in 1992 to pounds 5bn last year, attributable largely to recession and unemployment. And what jam there is has to be spread further: three out of four respondents to a CAF survey agreed that there are now 'so many charities that it is difficult to decide which to give to'.

The CAF fears that the arrival of the National Lottery next month may make a bad situation worse. Many people may persuade themselves that, by participating in the lottery, they are donating to charity. But only 5p in the pound will go to registered charities; far more will go to sport, the arts and other worthy causes. Playing the lottery is one of the least cost-effective ways of giving to charity.

All in all, Mr Brophy detects 'an internecine struggle as a growing number of charities fights over a declining or static' pot of gold. 'The winners will be those with marketing clout, prepared to tell the world about their virtues.'

So a degree of donor fatigue has set in. But is there a general funding crisis, or is it merely a problem of management or marketing - or fashions in giving - affecting certain charities? The ICRF is convinced that it is has not suffered more than other cancer research charities. But it is in a worse position than other long-established organisations. Like many blue chip charities, it relies surprisingly heavily on legacies. This year it reported voluntary donations of pounds 47,495,000, some 70 per cent from legacies. But Sir Walter Bodmer, its director-general, foresees a 10 per cent drop in the real value of its income from legacies next year. He has already detected a modest but accelerating decline, which he puts down to the slump in house prices and the fact that more people are having to sell their homes to finance their final years in residential care.

And precisely because the ICRF is, according to professional fund-raisers, cost-effective - 90 per cent of its income goes on research rather than fund-raising and administration - cuts at head office will not suffice. The axe has to fall on research projects, too.

This is not the whole story, however. The Royal National Lifeboat Institution, for instance, claims not to have been hit at all hard by the recession. Like the ICRF, it relies on legacies for some 70 per cent of its income, but Ian Ventham, its fund-raising manager, says: 'Income from legacies has risen - although we go in for a very soft sell. I can't really explain it - except that we tap into Britishness, the war and traditional values. It is not that we appeal naturally to older people, but that the people we appeal to are becoming older and thinking about writing their wills. We can't go on for ever like that.'

The Royal Society for the Prevention of Cruelty to Animals also receives some 70 per cent of its income from legacies, and Jerry Lloyd, its campaign director, has detected no decline and does not expect any. 'People feel for animals, whatever the state of the economy.'

So support seems to vary according to type of charitable objective. At one end, in a tremendously British fashion, appear to be animals that must be looked after, come what may. Next are those suffering potentially terminal diseases 'through no fault of their own'. And at the other end is the Aids charity, the Terrence Higgins Trust.

Surveys show that the recognition factor for the trust is as high as that of the ICRF, the RNLI or the RSPCA. But recognition does not easily translate into legacies or other donations. Nick Partridge, the trust's director, says: 'Our financial support (apart from 40 per cent from the state) comes primarily from a small group of people in their thirties, passionate about the cause and prepared to make big donations.' He has not noticed any decline, but is worried that his constituency remains narrow.

What unites all four charities is the increasingly professional nature of their attempts to shift the balance of funding towards corporate sponorship. The ICRF has established a new department to seek donations from industry, and Sir Walter says: 'We were a bit slow off the mark, but we are building up relatively fast.'

So, Mr Ventham admits, was the RNLI. 'Until relatively recently some of our older members felt that corporate fund-raising was not really on.' It seemed brash and vulgar to a generation used to making personal donations, or taking part in gentle lifeboat days when they were allowed to walk around boats, then bought tea and scones on the lawn of the some local big wig's house. Now, the RNLI has moved into corporate sponsorship with enthusiasm. It has already attracted Volvo and Seven Seas health products, and even agrees to companies sponsoring their own, named lifeboat.

The RSPCA prefers mutually beneficial tie-ins. One with Kelloggs corn flakes - from which it hopes to gain at least pounds 150,000 - enables youngsters to collect toy animals in exchange for RSPCA coupons from packets. The collectors obtain their toys from Kellogs, which makes a donation of 10p to the RSPCA for each application.

The Terrence Higgins Trust does not find it easy to raise money from business. 'Only a few companies support us, the most far-sighted and the bravest,' says Mr Partridge. But among them are middle-of-the- road names such as W H Smith and Marks & Spencer. In one scheme, 20 large companies sponsored the production of a training pack and video for managers who might have staff or customers with Aids. 'We then sold the package on to numerous other companies through the Industrial Society,' says Mr Partridge. 'We made a substantial profit and spread awareness, which is one of our charitable aims.'

As one professional fund-raiser puts it: 'Charities are coming to realise that they can't rely on charity alone. You have to give if you want to receive.' In a difficult period, the ICRF came late to this realisation.

(Photograph omitted)