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Unrestricted funding for charities? It can be done and we are doing it

Laura Chow
Long term funding enables charities to step off the constant treadmill of securing funds in order to deliver services.

So far £382 million has been raised through support from players of People’s Postcode Lottery for thousands of charities across Great Britain and internationally. Much of the funding from People’s Postcode Lottery is…

Unrestricted. Flexible. Long term.

It is this unique recipe which has been at the core of the funding relationship between People’s Postcode Lottery and our player supported charity family since we were founded in 2005.

This approach was no accident. When our sister lottery in the Netherlands was founded in 1989, it was done so by charity fundraisers with a strong social mission. Novamedia founder and Chairman Boudewijn Poelmann and his co-founders not only wanted to establish an on-going revenue stream for charities but they also understood the frustrations which can often result from restrictive funding.

The traditional fundraising model often places more importance on the funder’s wishes, however, at People’s Postcode Lottery our model is unique within the charity fundraising sector and in comparison to others. With a focus on achieving greater charity impact through a more flexible and long-term partnership approach, this allows charities to make the best possible use of funds in a way that will have the biggest impact. Whilst our long term funding commitment and partnership working provides them with a unique opportunity to develop, build resilience and become more sustainable for the future, allowing them to focus on growing their services.

We know the value of unrestricted funding to our supported charities. They told us. We commissioned charity experts and independent researchers, nfpSynergy, to carry out an anonymous survey of our grantees to gain a true assessment of our funding model. The resulting report, Funding For Impact, sets out the findings of this work and demonstrates the real benefits that this funding approach brings to our supported charities.

What were the key findings?

A common theme was interviewees stating that unrestricted funding was the ‘best thing’ about a funding relationship with People’s Postcode Lottery and ‘vital part’ of what makes it so beneficial, with them also reporting that unrestricted funding showed trust between a funder and a grantee.

Around half of those surveyed said if offered £100,000 of grant funding they would be prepared to take a cut of £17,300 on average in order to access unrestricted funding.

Meanwhile, long term funding enables charities to step off the constant treadmill if securing funds in order to deliver services. It also provides stability to pilot new projects and invest in their people.

What next for unrestricted funding?

The outcomes of this report are hugely positive and it is hoped that this research will have a two-fold impact. Firstly, to help other funders consider how they can best support charities and secondly, how we can further evolve our support for our People’s Postcode Lottery funded family. We understand the value of unrestricted funding to our 4,000 charities and good causes, as well as the security that comes with knowing that this funding is long term. These funds empower charities to do even more and encourages collaboration, not competition within the sector.