Survey reveals NFPs expect growth despite economic downturn

The second survey by PricewaterhouseCoopers (PwC), the Centre for Social Impact (CSI) and the Fundraising Institute Australia (FIA), Managing for Recovery was conducted in December 2009. It follows from the Managing in a Downturn survey of April 2009.

Managing for Recovery found that in response to the economic climate, 85 per cent of not-for-profit organisations (NFPs) are changing their focus from cost cutting to generating revenue growth over the next twelve months.

CSI spokesperson and report co-author Professor Peter Shergold said “The sector has been through a tough period but has not done as badly as anticipated six months ago. Stable support from government and less severe declines from other sources such as corporates has helped lessen the impact.

“In the six months since the last survey, more than half of the respondents experienced the pain of declining revenue, but now only a quarter (28 per cent) are expecting further declines going forward.

“While these figures are still not good, they are considerably better than was previously expected and an increasing spirit of cautious optimism now exists in the sector,” Shergold said.

“The economic upturn we’re seeing in Australia is being mirrored in the incomes of the NFP sector.”

Survey co-author and PwC partner Rick Millen said “Last year’s survey showed 64 per cent of NFPs anticipated a drop in income from corporates.

“But corporates have continued to support the sector more strongly than anticipated six months ago, and we’re seeing much more optimism with 82 per cent expecting corporate fundraising will remain flat or begin to grow again,” he said.

“It has been really encouraging to see that despite budgetary pressures, corporates have not abandoned the NFP sector. This perhaps reflects deeper and more sustainable cross sector relationships that have been established in recent years.”

According to the survey, the outlook for all types of fundraising income has improved significantly and is expected to continue to do so. NFPs are now looking to leverage this trend by applying more resources to increasing public awareness and fundraising activities.

FIA CEO Chris McMillan said that the survey clearly showed how swift action by the NFP sector in the first half of 2009 in putting sustainable business strategies in place ensured the sector successfully weathered the financial storm.

“It’s imperative NFPs continue to have a clear financial plan and strategy over the next twelve months to ensure their sustainable future in a competitive market,” McMillan said.

He said that larger organisations have fared better than their smaller counterparts in the last six months, with two in five of large respondents experiencing an increase in income compared to a quarter of small organisations. This trend is expected to continue across all sources of funding.

Shergold emphasised that the second survey provides an opportunity for the NFP sector to see how they have fared since the initial impact of the economic downturn and to get a snapshot on what their future outlook is likely to be for the next twelve months.

Emily Hollosy

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