Comparing VCSE sectors of NI, England & Wales, Scotland & Ireland

A key issue which comes up consistently in discussion about the future of voluntary fundraising regulation in Northern Ireland is that of “proportionality”.  To consider what this means in practice, we really need to be clear about NI’s position within the UK VCSE sector as a whole.

UK-wide

According to NCVO’s UK Civil Society Almanac 2016 there are162,965 organisations in the VCSE sector across the UK with a total income of £43.8 billion and the most recent CAF Survey showing the UK sector as receiving £10.6 billion from individual giving.

Scotland

SCVO’s Scottish Third Sector Statistics show that Scotland has 23,700 charities, (total for “organisations” unknown) has a total income of £4.9 billion and receives £807 million from individual giving.  This represents 7.61% of the total amount the UK sector receives from individual giving.

Wales

WCVA’s Third sector statistical resource shows that Wales has 8671 charities (33,000+ third sector organisations), has a total income of over £2 billion, receives £420 million (21%) from individual giving and has 938,000 volunteers. This represents 3.96% of the total amount the UK sector receives from individual giving.

Republic of Ireland

The INKEx project (published in 2012) showed that in 2009 Ireland had at least 11,700 formally constituted non-profit organisations and has a turnover of €5.75bn. Given that the Irish GNP in 2010 was about €130bn, then the community and voluntary sector accounted for over 3.25% of national income. 

Northern Ireland

Figures from NICVA’s State of the Sector 2016 recorded Northern Ireland as having 6,127 voluntary sector organisations, with a total sector income of £587 million and just £52.8 million received by way of individual giving.  This represents less than 0.5% of the total amount the UK sector receives from individual giving.

Profile of the sector

• 6.7% of sector are part of a UK wide organisation
• 5.8% of sector are part of an all-Ireland organisation
• 81% operate solely in NI 
• 3.8% are registered in NI but work overseas
• 2.7% are part of an international organisation

Income of the sector

• 5.8% of organisations reported an income of more than £1 million (this equates to approx. 355 organisations). They receive 66.8% of the total income. 1.6% have income of over £5million.
• 33.1% of organisations reporting an income of less than £10,000.

Proportionality in terms of choosing a new fundraising self-regulation system in NI

• The Fundraising Regulator’s systems, processes, staffing structure and 2.6 £million budget were originally aimed at providing a robust system of self-regulation for over 160,000 charities across the UK.  
• Scotland, having decided that their fundraising landscape and legislation were sufficiently different to the rest of the UK to justify the setting up of their own system, chose a much less resource-heavy option in terms of Scottish Fundraising Complaints.  
• NI’s voluntary and community sector represents a tiny % of that of the entire UK and is 4 times smaller than that of Scotland.  

This leads to two distinct schools of thought in terms of what would be our most proportionate response in choosing a new system of fundraising self-regulation.

The first is that, in terms of structure, it could be argued that the most proportionate response may be our currently proposed variation on Scotland's simpler system, i.e. a Helpline to refer complainants back to the charity as the first line of defence, followed (if needs be) by referral back to its trustees as the second line of defence and then finally referral to an Independent Panel as the third line of defence as a "last resort".  

However, the Scottish system currently has no cost for Scottish charities.  Unfortunately, NI cannot mirror the financial and other support which Scotland received from SCVO, OSCR and the Scottish government to not only set up but also run its own system and develop a “fundraising guarantee” to help it compete with the rest of the UK. The proposed costs of our system would therefore fall fully on the NI sector, with the ability to meet these costs needing to be guaranteed prior to pursuing this option.  Since UK-wide charities operating in NI are already regulated by the Fundraising Regulator all costs would actually fall directly on charities operating solely in NI. 

Thus, a second school of thought is that in terms of sector resources a more proportionate response for NI is to simply join with the Fundraising Regulator.  This would allow NI to adopt a self-regulation system which requires no resources to be found in terms of developing a new structure and/or potentially developing some form of "fundraising guarantee" to give equity with the rest of the UK.  The costs involved are also limited to a levy on a sliding scale on charities with an annual spend on fundraising of over £100,000 or a £50 administrative fee cost for those charities which aren't subject to the levy but who voluntarily choose to register with the Fundraising Regulator.

In terms of "proportionality" both schools of thought clearly have some merit.