Another blow for the small charity sector – why the closure of the FSI is a big deal.

March 20, 2023

Another blow for the small charity sector - why the closure of the FSI is a big deal. Mary Rose Gunn - CEO The Fore. Featuring a headshot of Mary Rose

The Fore’s CEO and Founder Mary Rose Gunn shares her thoughts.

“Last week, the already fragile ecosytem that supports small charities received yet another blow.  The Foundation for Social Improvement, or FSI, is closing.  This is an extraordinary loss and comes less than a year after the closure of the Small Charities Coalition (SCC).  

Like the SCC, the FSI’s value to the thousands of small charities and social enterprises who relied on them, was immense.  The FSI understood what makes small charities tick and how they can be strengthened, all whilst offering a space for leaders to share challenges and develop new ideas.   

During Covid, grassroots charities adapted their services in double-quick time. Groups that had run coffee mornings for the elderly offered remote armchair yoga whilst community cafes delivered food and medication directly to where it was needed.  Now, during a cost-of-living crisis, when small charities have never been more tightly squeezed, they’re providing crucial warm spaces and helping the most vulnerable navigate the tricky months ahead.   

But behind the youth sports projects, refugee advocacy services and arts programmes are organisations that need good governance, sustainable income streams and skilled staff to deliver on their missions. These organisations can’t run on empty and infrastructure bodies make sure they have access to the advice, training and networks they need to thrive.  

The problem that is going unnoticed is that the closure of The FSI and SCC is not a temporary blip – just weeks ago, research published by 360 Giving showed that more than 1,000 UK charity infrastructure bodies have closed in the past 12 years.  What makes these findings even more worrying is that the data shows there were disproportionate numbers of closures amongst those serving minoritised communities. Clearly, we’re not shouting loudly enough about the importance of infrastructure organisations.  We are failing as a sector if we don’t support our smallest and most vulnerable players. 

If I’m painting a bleak picture, it’s because we need to confront the reality small charities are facing.  I am sure in weeks to come, the sector will band together and pave a way forwards. The longer-term solution, however, demands a fundamental change in how those holding the cards think about investing in small charities – let’s not forget that SCC, FSI and most of the infrastructure bodies were small charities themselves.  

When we launched The Fore in 2017, we knew that offering resources that strengthen organisations behind frontline work means that impact on the ground runs deeper. We have the research to back up how listening to small charities and investing in their future works. However, six years on, there is still a serious lack of funding for capacity-building out there. There are some promising signs that things might be moving in the right direction. But the change needs to be bolder and faster. 

Looking at the government, the chancellor’s budget last week offered a welcome recognition of charities’ role in supporting those people the public sector can’t reach. £100 million proposed for the sector is, as Pro Bono Economics points out, a much-needed cash injection for the increased costs of frontline delivery and energy efficiency and sustainability.  But will small charities be trusted to identify how to spend this on what they really need? Or will it be limited to narrow impact targets and the price of electricity. It’s certainly too late for The FSI or SCC even if they had been eligible.  

We can’t expect our local communities to be vibrant, connected and self-sustaining if the small charities who have the expertise to make that vision a reality aren’t supported. This spring, we are saying goodbye to a trusted partner. But the true cost of losing organisations like the FSI will be felt in the months to come, by communities across the UK. It’s time we as a sector had some important conversations about how we fill the gaps that are left. We must all be the voice of the small organisations that operate on the front line or the gradual erosion of resilience will continue.  We can’t let small charities down any longer.”