🌩️ The Perfect Storm of Financial Pressure 💸📉
A recent report by the Directory of Social Change revealed that 60% of charities experienced a decrease in government grant income in 2023. At the same time, over 68% reported increased demand for their services. This isn't a funding anomoly - it’s a sustained squeeze on finances that showed no signs of easing in 2024, and not in 2025 as government wrestles with competing calls for funding.
Compounding financial challenges is the increase in National Insurance Contributions (NICs), set in motion by the budget and taking effect from April 2025. Charities are not exempt - and many, already operating on tight margins, now face the possibility of having to cut staff, freeze hiring or scale back essential services just to stay afloat.
Operating costs across the board are rising. From energy bills to software licensing and, critically, office space—charities are being hit on every front. The Charity Finance Group noted that for smaller charities, office rent and utility costs can now account for up to 20% of operational expenditure.
📈 The Cost Crunch Facing Charities
The data paints a difficult picture for UK charities and the financial pressures they face:
£10 billion funding shortfall: UK charities are projected to face a £10 billion funding hole over the next six months, largely due to increased demand and reduced funding streams (About Manchester).
One in eight charities at risk of closure: That’s potentially over 20,000 of the over 160,000 UK registered charities who may be forced to shut down due to funding challenges, with smaller charities hit the hardest.
Rising employment costs: The 2024 Budget didn’t bring relief - an increase in National Insurance Contributions is set to place even more financial strain on organisations already at their limit in 2025 (Civil Society News).
Inflationary pressures: Charities have seen operational costs surge across energy, rent, software, wage pressures, and essential services.
📊 Rising Demand, Shrinking Support
Those donating to charity have also been under pressure from cost of living pressures, putting strain on their ability to give to charities. In fact, 11% fewer people donated to charity in 2023 compared to 2016 - leaving charities reliant on a decreasing pool of donors.
Not only are funds tighter - but demand for services is soaring.
Per the Charities Aid Foundation's survey of over 750 charity leaders in late 2023, 86% of charities were reporting an increase in demand for their services with over 50% reporting demand up "a lot" - a rise of over 40% on the previous year.
As public services face cuts and inflation bites, more people are turning to charities for help.
- In 2023–24, the Trussell Trust distributed 3.1 million food parcels, more than double the number from five years ago.
- Many charities supporting mental health, housing, and social services have seen demand increases of 30–50% year over year.
- Meanwhile, local government grants and funding streams have not kept pace, leaving a critical gap and significant pressure on charities.
🏢 Space: An Overlooked Cost Opportunity
One of the largest fixed costs many not-for-profits face? Like most organisations - their offices.
Charities and NFPs need workspace —but it’s expensive, and with hybrid working, many offices are not running at maximum occupancy most of the time.
Many offices are underutilised, meaning potential value in "bang for the buck" is not being maximised, especially in an environment where more than ever every penny counts, this is something that needs addressing.
According to the Charity Finance Group, more than 60% of charities are exploring ways to reduce physical space to save or differently use money.
✅ Smarter Space Management = Real Savings
This is where smart workplace technology can help. Solutions exist which can help with:
- Sharing and managing desks, rooms, and offices across teams and locations
- Managing and provisioning for the space needs of a neurodiverse workforce
- Understanding space usage trends to identify poorly utilised space
- Reducing rent, utilities, and maintenance by shrinking footprint and/or using space smarter
- Helping people know when to come to the office to see colleagues based on their schedules, potentially managing when people will be in and reducing peak office occupancy - meaning less space is needed.
🎯 Even a modest office downsizing can save thousands per month. Technology makes this possible without disrupting, and sometimes enhancing, day-to-day operations.
🧾 Long Term Value and Planning Counts... But Cost Right Now Still Matters More
Let’s be real - the above sounds great, but most workplace platforms come at a cost, and for charities, even modest software fees can feel out of reach.
Even "affordable" platforms usually come with a price tag. But unlike fixed office leases, good technology should pay for itself quickly by unlocking and enabling real efficiencies. The key is choosing a system that fits your size, budget, and goal - meeting your core needs, rather than "dream world" needs.
We also know that despite budget challenges, charities can’t wait. We understand that value matters more than ever. That’s why askAiB offers special pricing for charities and not-for-profits, making it possible to manage space intelligently without blowing the budget.
We really do want to help, so please do get in touch with us and discuss our special NFP options!
👉 Book a free demo or chat with us
📣 It's Time to Reimagine the Workplace
