The variety of UK charities which were pressured to close their doorways for good has jumped by 74 per cent this 12 months, with the rising price of residing, stalling donations and the enhance in employers’ nationwide insurance coverage all blamed for the stunning rise.
The sector has raised fears that folks in want will probably be left with out very important help, with Oxfam warning that charities are being “requested to do extra with much less, on the very second folks want us most”.
There are additionally considerations that the federal government’s Employment Rights Bill, which might require charities to ensure hours for zero-hours employees and pay compensation for cancelled shifts, may additional pressure charities’ budgets, driving extra insolvencies.
Oxfam, which in April mentioned it took the “tough choice” to place 265 of its 2,100 employees vulnerable to redundancy, has now warned that charities are being “requested to do extra with much less, on the very second folks want us most”.
The variety of main UK charities, outlined as people who recorded revenues of over £50k, shutting down jumped to 151 in 2024/25, up from 87 in 2023/24, in response to charity fee information analysed by chartered accountants and enterprise advisers Lubbock Fine.
The agency mentioned the rise in insolvencies displays a “triple hit” of rising employment prices, stalling donations and lowered authorities funding.
The surge in closures comes as demand for providers equivalent to meals banks and counselling programmes is rising, leaving extra susceptible folks with out important help.
Earlier this 12 months, Macmillan Cancer Support introduced it had axed 1 / 4 of its employees, downgraded its helpline and scrapped its flagship monetary hardship scheme, which offered hundreds of thousands of kilos in grants to hundreds of sufferers.
Data from the Charities Aid Foundation indicated that there are 4 million fewer particular person donors since 2019, whereas money donations from British companies have fallen by round £300m this 12 months in comparison with final, equating to round 5,455 small charities going unfunded.
A spokesperson for Oxfam advised The Independent: “Communities the world over are dealing with unprecedented ranges of want, from battle to local weather change to rising inequality. Charities are being requested to do extra with much less, on the very second folks want us most.
“Rising residing prices and better National Insurance contributions are including to the pressure, and future cuts to UK support threat deepening this disaster, stripping away very important lifelines for these residing in poverty.
“Aid is a great funding in stability, safety and alternative for all of us. At a time of rising international challenges, the UK needs to be trying to strengthen its help for civil society, not scale it again.”
Hazra Patel, associate specialising in charities at Lubbock Fine, advised The Independent: “Charities within the UK are dealing with a rising burden of prices, leaving many with no possibility however to close their doorways.
“This is an alarming development, because it leaves folks in want with out the very important help that charities as soon as offered.”
Pointing to increased employers’ National Insurance Contributions, she added: “Employment prices are rising on a number of fronts, forcing charities to chop again employees and scale down operations simply to outlive.
“Rising prices and stalling donations are hurting charities deeply, and authorities coverage is providing little help. Many within the sector concern they are going to be pressured to cut back or shut altogether.”
In May, the Trussell Trust revealed a stark enhance within the variety of emergency meals parcels distributed throughout the UK, with a 51 per cent rise recorded over the previous 5 years.
The charity delivered practically 2.9 million emergency meals parcels within the 12 months to March 2025, a major bounce from the 1.9 million distributed within the 12 months to March 2020. This surge has prompted pressing calls for presidency intervention and a reassessment of welfare reform insurance policies.
