Largest NGOs getting biggest share of UK development cash

15 Oct 18

Larger international NGOs are getting the “lion’s share” of the UK’s international development funds, an umbrella group has said.

Bond has found international NGOs in the UK received 33% of their funding through government grants and contracts in 2016, in a report Financial trends for UK-based INGOs, which analysed income trends of 305 of its members between 2006 and 2016.

However, it found that nearly all growth in government grants and contracts have flowed to INGOs with an annual income greater than £20m. Those with less annual income did not see any increase in funding from the government, relying more on individual giving and the voluntary sector.

Murtaza Jessa, head of charity at chartered accountancy firm haysmacintyre, wrote in the foreword to the report: “It is clear that there are winners and losers and there is some striking polarisation, with the larger organisations attracting the lion’s share of government funds, individual giving and voluntary sector income.

“The lessons for organisations are clear: they must remain nimble and not take any funding for granted.” 

The total income in the sector was £3.8bn in 2016, which is up 59% since 2006, the report found.

A third of this income went to the eight largest organisations, with an annual income greater than £100m, while another third went to 17 INGOs with incomes between £40m and £100m, the report said.

The remaining third of the overall income went to 280 organisations with an annual income below £40m. These smaller organisations received 31% of the total income for the sector in 2016, compared with 39% a decade before.

The biggest growth in government funds to INGOs was from overseas and international governments, which more than doubled over the ten year period.

The report added that income from the European Union was also significant, but this could disappear depending on the outcome of the Brexit negotiations.

Public support and individual giving made up 31% of NGO income, the report found.

Graham MacKay, chief operating officer of Bond, said: “Larger INGOs may be in a better position to access these funds and partly accounts for much of the disproportionate growth of government income for larger organisations.”

But he added that big is not always better.

“Smaller NGOs have specialised expertise, local knowledge and niche skill sets so it’s important that government grants and contracts are made more accessible to these types of organisations too.”

Speaking more generally of the findings, he said: “This report shows that the critical work development and humanitarian organisations do – from supporting families out of poverty to responding to the consequences of climate change and humanitarian crises.”

They had “seen incredible support from the UK public, with much of the funding coming from people’s pockets,” he added.

Did you enjoy this article?

Related articles

Have your say

CIPFA latest

Related jobs