Innovation In Giving

Who is giving to charity and what does this tell you about the state of the economy and society?

Baroness Claire Tyler

Recent research is pointing to a growing generational gap in charitable giving. What’s interesting to me is what lies behind these trends and what it means for charities moving forward. Professor Sarah Smith’s research, building on a major collaborative study published in early 2011 “The New State of Donation”( Bristol University/Cass Business School/CGAP) tracked three decades of household giving to charity. In nutshell it showed that older people, particularly those aged 60 plus, are increasingly the most likely to participate in charitable giving and give most.

A report published this September by the Charities Aid Foundation and the University of Bristol to stimulate debate at the party conferences also made the growing generation divide in giving its main headline. It stated that more than half of all donations now come from the over 60s compared to just over one third thirty years ago. It also said that the over 60s are now more than twice as likely to give to charity as the under 30s. Should we be worried about this and what should charities be doing about it?

As so often, if you dig a little deeper, a more complex picture emerges. The long term decline in giving amongst younger age groups between 1978 and 2002 appears to have been reversed during the 2003 – 2008 period. Data covering the impact of the recession is not yet fully available, although given sharply declining living standards for many low to middle income earners, it’s fair to speculate that charitable giving may be tailing off even more. Gender also makes a difference – women give more than men, as do households with children, people in employment and those with higher education. Additionally, whilst better off donors now account for an increasing share of total donations, poorer households are much more generous if you look at the proportion of their total budget given to charity. It is interesting how little publicity this latter point receives compared with the age focus .I’d like to see more public recognition of this generosity from poorer people –it’s an  important antidote to the  “benefit scroungers” narrative of which we hear so much.

So what’s to be done? One of my first reactions on reading these reports was that we must not be too quick to point the finger at younger people. The financial pressures that many of under resulting from ever higher levels of indebtedness (often linked to studying), youth unemployment and the huge difficulty in getting the first foot on the housing ladder at a time of sharply declining living standards must be having a big impact on choices about disposable income. I also think it’s incredibly unfortunate that, however unfairly, in some people’s mind charitable giving is becoming more associated with tax avoidance. And now more than ever, charities need to be able to demonstrate that they use the money they receive effectively and show how it improves the lives of their beneficiaries.

To finish where I started off, perhaps above all charities need to do a lot more to involve younger people in their activities, whether by actively reaching out to recruit younger trustees, taking on apprentices and interns and recognising that for many young people the most precious thing they can give is their time and passion which may – in time – translate into regular charitable giving.  Indeed I’d like to see more focus and support given to volunteering by young people. For this generation, as distinct from the baby boomers, it’s often a more available and meaningful commodity. Linked with other research for the sector which shows that the amount of time given by people is positively correlated with the amount of money they give, I suspect this is the key that has the potential to unlock and changes attitudes to giving across the generations.

Baroness Claire Tyler is a Liberal Democrat working peer in the Lords, ex Charity CEO of Relate, Current President of the National Children’s Bureau, Chair of CAFCASS and Vice Chair of the All Party Parliamentary Group on Social Mobility.

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