Top donors step in to save charities

Britain's leading philanthropists have pledged to bail out charities whose services have been hit by dramatic falls in public donations triggered by the recession.

Today The Independent reveals Britain's top philanthropists, a list of 30 industrialists, financiers, entrepreneurs and celebrities who have made a habit of giving their wealth away. We canvassed the charity sector and philanthropic organisations to find out who were this year's biggest givers.

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Homeless projects, international aid, medical research and educational trusts will all benefit from more cash and greater support from this group of wealthy donors whose combined giving amounted to £2.3bn this year.

The pledge comes as charities call for more money to stop job losses and further cuts in their services.

In a bleak assessment of the situation, charity leaders have told the Government that they are facing a "double whammy", with funding being reduced at the very moment they are being asked for greater help by victims of the recession.

Corporate donations have fallen by 20 per cent, while legacies have been badly hit by the crashing property market. And as tax revenues are further reduced, charities expect government funding to the charity sector to be affected.

But Philanthropy UK, which advisers wealthy donors, says that many industrialists, financiers, entrepreneurs and celebrities intend to come to the aid of the charity sector by maintaining or increasing their funding. The London-based organisation says that "pledged gifts remain firm", with many philanthropists recognising that it is during this time of financial crisis that charities need their support most.

Sir Ian Wood, chairman of the Wood Family Trust in Scotland, told Philanthropy UK: "We are working with pre-allocated funds on long-term plans. We've always been focused on fewer charities looking at clear measurable impact and we always seek to leverage our funding wherever possible. Our position on this has not changed."

And the Wates (family) Foundation said that it will make new awards because the average charity is most likely to be riding out the effects of the downturn. The philanthropist Dame Stephanie Shirley, whose foundation has given £1.25m this year to support people with autism, said: "We will maintain our grant giving, even if this means eating into our foundation's capital. All our planned expenditure [on the scale of last year's £1.25m] is held in cash."

Doug Miller, founding trustee of the European Venture Philanthropy Association, added: "My giving will not change as I have long-term strategic goals and set aside funds to achieve those goals during the bubble."

Tanja Jegger, head of philanthropy at Stonehage, the wealth manager, says that their philanthropy clients are also looking to increase their charity work. "We have on balance seen greater demand for philanthropy services this year, with a strong pipeline for 2009 in the UK. In particular, donors are showing increasing interest to collaborate with peers to optimise the efficiency and impact of their giving."

At the private bank Coutts & Co, Maya Prabhu, senior philanthropy adviser, says: "We are relatively bullish that philanthropy amongst wealthy individuals will remain high on their agenda based on the continued interest our clients have shown in giving both time and money and their requests for advice on how to channel this most effectively."

Susan Mackenzie, director of Philanthropy UK, says she is not aware of any pledges that have been rescinded. "A few donors are renegotiating the terms of major gifts, but this is more likely to be extending the length of time over which the gift is paid out, rather than the total amount of the gift," she said.

Figures to be released next month by the Association of Chief Executive Officers of Voluntary Organisations are expected to show an even greater fall in donations. Charity leaders are now calling for a £500m bailout by the Government. Andrew Hind, chief executive of the Charity Commission, said: "Nearly all organisations, including charities, are feeling the effects of the financial downturn. Some charities will struggle in the coming months, and others may need to make difficult decisions about use of resources. Unfortunately some charities may have to make cuts, or delay projects; some may have to make redundancies."

The Institute of Philanthropy says there are real dangers facing the charity sector. Its director of communications, Musa Okwonga, said: "The threat to philanthropy does not arise from the credit crunch per se, but from the priority that people will place on their giving in the current economic climate. The danger is that people will think that the charity that they give to – be it a local hospice, or their weekly copy of the Big Issue – is a household expenditure that they can now do without. If we choose to cut other costs before we cut our giving, then charities will be far better offfor it."