Charities anticipating donations decline as Canadians' needs increase

Anticipating declining donations and increasing need for their services, Canadian charities are hoping people with means will still donate during the holidays.

“The needs are much greater this year, whereas we have been fortunate to engage hundreds of thousands of Canadians who are giving, we find ourselves in a situation where many of them are in need of help themselves,” said Pauline Tardif, vice president, Fundraising and Partnerships at United Way Centraide Canada.

“There’s a bit of a tension there between the ability to give, and the need to access the services that United Way’s network of agencies deliver,“ Tardif told CTVNews.ca in a telephone interview on Dec. 16.

According to a survey from IPSOS published in November, 22 per cent of respondents said they will turn to charitable services for food, clothing or shelter in the next six months. That’s an increase from January 2022, when 14 per cent of those surveyed reported an expected reliance on charitable services, according to IPSOS.

Rising interest rates, economic uncertainty,and the increased cost of living are cited as reasons for growth in reliance on charities, according to the survey.

But at the same time, a charity-monitoring organization is telling Canadians to be wary of some larger charity calls for donations, as it says many have millions in the bank and have enough to get through a possible donation slow-down.

“As a donor, you need to give yourself the time to check the facts and do some homework,” said Kate Bahen, managing director of Charity Intelligence Canada, a non-profit that assesses Canadian charities and their impact, in a phone call with CTVNews.ca Friday.

In 2020, donations to charities in Canada increased by 2.7 per cent for a total of $10.6 billion, according to a report by Statistics Canada published in April. Donations from 2020 do not show significant changes compared to the previous few years, the report states.

However, there is a downward trend in the number of donors, seen predominantly in fewer Canadians reporting donations under $100 (a decrease of 6.5 per cent in 2020), according to the report. There was an influx of larger donations from a smaller number of donors too, which was offsetting that decline.

Not all donations are reported by tax filers in Canada, due to the use of crowdfunding platforms or organizations not linked to registered charities, Statistics Canada says. It’s important to note that “many small donations are not captured in the tax data,” it states.

WHAT CHARITIES ARE SAYING

Canadians have less money to give due to a decline in disposable income, linked to inflation, said Tardif. As well, the economic impact of the pandemic is reverberating for the most vulnerable Canadians, as they are still recovering or reeling from periods of job loss.

While the charity doesn’t have specific data they can provide on current giving as they are in the middle of a season, there’s no doubt that current economic constraints are having an influence, she said.

United Way’s goals involve addressing systemic socioeconomic concerns that are impacting people and their families, from housing and food insecurity to ensuring children have winter clothes for school, explained Tardif.

“This is the greatest challenge right now, is that it’s not one or two things, but a variety of things,” she said. The charity works with a network of community partners and agencies to address those needs, she said.

Donations to The Salvation Army are down about 20 per cent compared to the same time last year, said Lt-Colonel John Murray, territorial secretary for communications at the charity in a phone call with CTVNews.ca on Dec. 16. The fundraising goal is $22 million.

That’s with fundraising overall and with the charity’s “Christmas kettles”, which are about 2,000 physical locations across the country where Canadians can donate, he said.

The charity is also a Protestant Church with a headquarters in London, England. It provides services around helping those who are facing homelessness, poverty and addiction.

With more families being reliant on food banks, this is a time of year whenit is important to donate, said Murray.

Food Banks Canada, a charity that represents food banks across the country, said in its 2022 annual report released in November that there were 1.5 million visits to food banks across the country in March 2022, which represents a 35 per cent increase compared to March 2019.

The reasons users reported for using food banks were increased cost of food, low provincial social assistance rates, and housing costs.

According to Imagine Canada, a charity that provides other charities with resources, 48 per cent of Canadians intend to donate for the 2022 holiday season,compared to 56 per cent in 2021.

The International Development and Relief Foundation, a Canadian non-profit that provides relief for programs based on Islamic principles, told CTVNews.ca via email Dec. 20 that inflation is impacting communities here and abroad.

Elyas Burney, the program lead for national initiatives at the charity, cited Imagine Canada’s survey on possible donation decreases as a concern and said the charity provides warm clothing and food for those who live in countries like Afghanistan, and do not have proper shelter to endure the colder winter months.

HOW TO PICK THE RIGHT CHARITY

However, if Canadians are looking to donate this year, Bahen recommends focusing on smaller charities, as those will have more difficulties functioning if there is a donation drop.

Examine a charity’s balance sheet along with overhead costs and see how much program spending is in the bank, said Bahen.

“Charities, not all charities, but some charities are constantly driving this drumbeat of a ‘crisis’ to open up donor’s wallets,” she said. “That’s why it’s so important to always check the facts."