Future Issues

Introduction

You can find the data used in the charts in this section on NICVA's Data Portal.

As part of NICVA's State of the Sector research organisations were asked to give their views on a number of operational and structural areas which may have an impact on the sector and their organisations over the next 12 months. They were also asked about the potential impacts of Northern Ireland political structures on their operations and to identify weaknesses and threats facing their organisation.

Data used in this section is taken from NICVA's 2016 Sector Forecast Survey and, where possible, comparisons have been made with NICVA's previous research. The Sector Forecast Survey was disseminated to 4,113 community, voluntary and social enterprise organisations between 11 January to 5 February 2016 and achieved a response rate of 23% (n=944). You can find out more about the methodology behind the Future Issues section here. 

 1.0  General and Economic Outlook

Organisations were feeling less optimistic about their general outlook compared to previous State of the Sector research.

• Close to one-third of respondents (31.3%) expected their general situation to worsen, while 23.6% of respondents expected an improvement in their general situation over the next 12 months. This marks a decrease of almost 10 percentage points from 2012, when 32% of organisations expected an improvement over the next year.
• This suggests that organisations are feeling less optimistic than they did four years ago. However, this does not reflect UK wide trends, for example, NCVO reported in 2011 that 43% of organisations surveyed thought their situation would worsen over the next year while in 2015 this figure had dropped to 17%. 

A high proportion of respondents expected the economic outlook of the sector to worsen in 2016 (66.3%).

• A high proportion of respondents (66.3%) expected the economic condition of the voluntary and community sector to worsen in 2016.
• A small proportion of respondents (4.8%) anticipated that the economic situation would improve, while 21.5% expected it to remain the same.
• This negative outlook is likely due to unprecedented cuts that the sector has experienced in recent years. In addition, delays in 2016/2017 departmental budgets being finalised may have also heightened feelings of financial insecurity amongst organisations across the sector.  

 2.0  Income and Expenditure Outlook

A significant proportion of respondents (38.1%) predicted that their income would decrease in 2016.

• In light of the pessimistic economic outlook held by many respondents, it is perhaps unsurprising that a significant proportion (38.1%) expected their income to decrease in 2016.
• 29.5% expected their income to remain the same and just 17.5% of respondents anticipated an increase in their income over the next 12 months. 
• Despite many organisations reporting that they expected their income to decrease or stay the same, a substantial proportion anticipated an increase in their expenditure over the next 12 months (43.2%). 

• Respondents with an income of more than £5 million were most likely to expect their income to increase (31.6%) or stay the same (36.8%) over the next year
• Respondents with an income of between £250,001-£500,000 were most likely to expect their income to decrease (47.1%).

• Respondents that fell within the £5 million+ income band were most likely to forecast an increase (55.6%) in their expenditure in 2016.
• Those respondents that fell within the £500,001-£1 million income band were most likely to predict a decrease (29.4%) in expenditure in 2016. 

 3.0  Operational and Service Changes

The majority of respondents expected the number of services and activities they provide to either increase or stay the same over the next 12 months.

• 81.4% of respondents expected the number of beneficiaries they support to either increase or stay the same, while 80.4% expected the number of services they provide to remain the same or increase.
• Large proportions of respondents expected no change or an increase in their campaigning/ lobbying activities (80.7%) and their volunteer management practices (84.3%).
• Over three quarters of respondents (76.5%) expected competition for funding in the sector to increase. This finding is perhaps unsurprising given the reduction in funding available to the voluntary and community sector from government and other sources.
• One-fifth of respondents (20.4%) expected staff numbers to decrease while 54.7% expected no change.

• Those respondents with an income of between £500,001-£1 million were most likely to indicate that they expected to lose staff in 2016 (30%).
• Respondents that fell within the £5 million+ income band were most likely to expect an increase in staff numbers over the next 12 months (27.8%). 

 4.0  Closing and Restructuring

The majority of respondents did not envisage closing their organisation in 2016, while a significant proportion expected to undertake an organisational restructure (34%).

• Just over one-third (34%) of respondents expected to undertake an organisational restructure in 2016. Notably the 2014 Workforce Survey found that 33% of respondents had undertaken a restructure in the previous 12 months. These findings suggest that restructuring is a common feature of the voluntary and community sector.
• 3.2% of respondents envisaged closing their organisation in the next 12 months, and this figure closely mirrors findings from previous State of the Sector research (2012).
• One-sixth of respondents (16.9%) expected to close services, which could be due to cuts the sector has experienced in recent years and the current financial insecurity caused by government budget delays. This marks an increase of 7.6 percentage points from findings presented in previous State of the Sector research (2012).

• Those respondents with large incomes, were more likely to state that they expected to close services in the next 12 months compared to respondents that fall within the lower income brackets.

 5.0  Collaboration and Mergers

In previous State of the Sector reports collaborative working was identified as a key feature of the voluntary, community and social enterprise sector, with many organisations pursuing new and innovate ways of working in order to sustain their activities in a difficult economic climate.

Results from the Sector Forecast Survey revealed that collaborative working will continue to be an operational feature for many respondents in 2016.

• 69.6% of respondents expected to collaborate with another organisation in the next 12 months, which marks an increase of 6.7 percentage points from previous State of the Sector research (2012).
• 6.3% of respondents anticipated merging in the next 12 months, and this figure is almost unchanged from 2012 (6.6%).

 6.0  Impact of the Political Landscape

In previous State of the Sector research (2008) it was reported that the devolution of power to the Northern Ireland Assembly was the largest single event that had impacted the voluntary and community sector since 2005. As a result, State of the Sector research has monitored organisations views around the impact of devolution to the Sector since 2008.

A significant proportion of respondents (38.6%) stated that the NI Assembly had a negative impact on the voluntary and community sector in the last 12 months.  

• Over one third of respondents (38.6%) stated that the devolution of power to the Northern Ireland Assembly had a negative impact on the voluntary and community sector over the last 12 months. This marks an increase of 26.7 percentage points since previous State of the Sector research (2012).
• The proportion of respondents that stated the impact has remained positive has decreased by a small margin (2.5 percentage points), while the proportion of respondents that stated there has been no impact decreased from 35.9% in 2012 to 22.1%. 

• One-third of respondents (33.6%) expected the NI assembly to have a negative impact on their organisation's operating environment in 2016.
• 16.5% stated that the impact would be positive while 22.2% stated they were unsure.
• Although not directly comparable to the previous State of the Sector research due to the wording of questions, it is worth noting that in 2012 just 16.4% of respondents felt that the impact of devolution would worsen their operating environment. This would suggest that sentiment towards the Northern Ireland Assembly has worsened in the last 4 years. 

On 1st April 2015 11 new Super Councils replaced the previous 26 under a programme of reform. Under this reform the 11 new councils took control of a range of issues which were previously the responsibility of the Northern Ireland Assembly, including local planning, urban regeneration, community and economic development.

A significant proportion of respondents (51%) felt that the transfer of powers to the new councils would have no impact or a negative impact on the sector. 

• Over one-third (35.7%) of respondents stated that the transfer of powers to the new councils will have a negative impact on the voluntary and community sector, while 15.3% felt the transfer of powers will have no impact.
• 26.1% stated the impact will be positive.

Respondents were asked to rank who they think their most significant political relationship will be with over the next three years.  Local councils were ranked first followed by government departments, while commissioning bodies and groups and arms-length bodies were ranked third and fourth respectively.

 7.0  Weaknesses and Threats

The main weakness/ threat identified by respondents to the sector was public sector cuts. Lack of diversification of income and competition from other organisations were ranked second and third respectively. Weaknesses and threats identified by respondents in the 'other' category included lack of funding and lack of volunteers.