Funding Advice Bureau SYFAB guide to... Charitable trusts What is a charitable trust? Charitable trusts are bodies set up (often by people now dead, like the Esmée Fairbairn Foundation) with an amount of money to do good. That money, or capital, is invested and the income generated from the investment is spent each year on good causes. There are thousands of charitable trusts in the UK. Each trust is governed by a trust deed which is a document setting out the objects of the trust. The objects spell out what its purpose is, how the trust should operate, and what sort of causes it will give money to. Each trust has appointed trustees who are the people responsible for ensuring that the money is given away in accordance with the objects in the trust deed. Some trusts are set up to fund on a national level, like Comic Relief, others are local and only fund groups within their geographical region, like the South Yorkshire Community Foundation. Most national trusts will only fund groups whose work fits into their area of interest, for example, environmental or mental health projects. Many local trusts will consider applications from all kinds of groups in their area and are more likely to be aware of local need and activity and have an interest in supporting you. Local trusts tend to give smaller amounts of money. Unlike the large national trusts, local trusts do not usually have paid workers to deal with applications and enquiries. The trustees themselves often do all the work of receiving, processing and vetting applications. Charitable trusts are completely different from other funders such as local and national government, and from the National Lottery. The major differences are that: • they are spending private not public money and so are not accountable to the public for how that money is spent; and • they do not have a ‘statutory’ or legal requirement to make sure that certain services are provided. This means that it is entirely up to them who they give their money away to and how they give it. How much money do they have? There are about 8,800 charitable trusts and foundations in the UK, giving away something like £2.7 billion per year to charitable causes. (Source: Association of Charitable Foundations, 2007). This is a considerable amount of money, roughly the same amount as is given each year by government. Who and what they give money to The Inland Revenue has to be satisfied that charitabletrusts use their income for purposes that are charitable in law. In practice this means that most trusts will only give grants to organisations that are registered charities. If your yearly income is more than £5,000 and your aims are exclusively charitable then you should apply to become a registered charity. If you are a member of a larger or national body that is a registered charity, you may be able to apply to trusts for grants through that umbrella or parent body. Over 50% of charitable trust grants go to local organisations, followed by national organisations, then grants to individuals. The smallest amount goes to international or overseas bodies. The broad areas of work that trusts give money to are (listed in order of size of grantmaking, highest fi rst) : Social Care Health Education Arts and Culture Environment International Faith-based Other/general Source: Charity Trends 2006 Trusts do not like to be asked to make up for the loss of funding from statutory sources like the local authority. If you find your funding cut and want to approach trusts to make up the shortfall then you might need to restructure the work of your organisation, repackaging it into projects that they are more likely to support. Trusts like to see their role as distinctive and so tend to concentrate their funding on: • New, innovative ways of working • Disadvantaged and minority groups • Creative responses to new needs and problems • Work which is hard to finance through more conventional fundraising • Short and medium-term work which may attract long- term funding from elsewhere • One-off purchases or projects. How much, and what sort of money they give Most of their money goes into one-off grants. Lesser amounts go into running costs. Most only give money for a short time period, say, 12 months. Some will fund for up to three years but very few give grants for any longer than this. Trusts’ giving is usually for one-off project funding, like running a summer playscheme for six weeks or carrying out a piece of research, and for capital appeals like building works or equipment. Any funding for ongoing revenue costs such as workers’ salaries will be time limited. How to find out about them Trusts don’t have to publicise what they do, or what sort of things they give money for, or how you apply – or even that they exist at all. Some are very open about what they do, some aren’t. SYFAB’s information service maintains a database of relevant charitable trusts with details, where available, of their policies and how much money they typically give out in grants. SYFAB provide free online funding information services to help you find sources of funding for your organisation easily and quickly. You can keep up to date with the latest funding opportunities using our Funding News website and email service, and you can find possible funders for your activities with our funding search website. Go to www.syfab.org.uk for more information and to sign up. If you don’t use the internet, then our Funding News is available monthly by post and our Information Service can help you identify appropriate sources of funding by doing a free funding search for your group. Contact SYFAB for more details. How to apply Raising money from trusts is not a quick process. Leave plenty of time firstly, to research which are the best trusts for you to apply to and secondly, for your application to be considered. Many trusts meet only once or twice a year. Check their application deadlines. You may need to get applications in well in advance of meetings and you can expect to wait anything up to six to nine months for replies. Make sure your project fits the funding criteria of the trusts you are applying to – otherwise all your hard work will just go straight in the bin. Many trusts don’t have application forms. You need to apply by letter. Many trusts only write to successful applicants. If you want to hear from them it may be worth enclosing a stamped, self-addressed envelope when you write. For advice on what to put in a letter or in filling in an application form see our information sheet on ‘Making a good application’. How to decide what to ask each trust for You need to go through each trust’s policy statement and funding criteria to decide exactly what to ask them for. There may be a particular aspect of your work that you should stress to that funder. For instance, if a trust says that they support work with women, you could use statistics to show that although your advice centre is open to everyone, over 50% of your clients are women, and with their support you aim to set up a women only advice session once a week. In the same way, you should look at the amounts of money they normally give out in grants and make sure that the figure you are asking for fits within that range. If that particular trust normally makes grants of £100 to £500 and you want to install a wheelchair accessible toilet in your building at a cost of £7,000, then you need to think again about whether it is worth approaching them for this particular project. Or you could ask them to make a contribution towards the overall costs. Applying to lots of trusts at the same time If you only apply to one trust at a time it could take you an awfully long time to raise your money. It might be better to take it in stages. If you’re looking for a lot of money you could apply to the larger trusts first, getting support that you can then use to persuade other funders to donate. If you only want a small amount of money you could try a small number of trusts first and see how you get on. If you Doing it in stages can also make it a more manageable task. And it is far better to write five well-targeted, personal letters than sending a circular to 20 trusts. What happens if more than one trust gives money for the same thing? Be honest and tell them what has happened. But before you contact them identify another piece of work or equipment that costs the same sort of money and ask if you can use their grant for that instead. Most trusts will agree because they’ve already decided that they want to give you a grant and they’re unlikely to want to revise that decision as long as you are up-front about it. When you don’t hear back from the trust Only the top 300 or so trusts employ staff. Most are run on a part-time or voluntary basis by the trustees themselves, or by solicitors or accountants, so don’t expect too much of them. If they publish a phone number then you could ring to see where your application has got to. If no phone number is given then it usually means phone calls are not welcome. If they feel you are pestering them then your application may be jeopardised. Most trustees respond very badly to being canvassed, and there is little you can do to influence a decision once you have made an application. Do trusts consult each other about applications? Some do, some don’t. Some local trusts may share the same trustees. Some national trusts, like Comic Relief, use local contacts to check out applicants. Some have formal assessment procedures which may include them visiting you. Some trusts, like BBC Children in Need contact local authorities to check out applications. raise the money you need fairly easily from them, it leaves other funders to be approached for future projects. This means that you need to be consistent. Tell the same story to each trust although you do not have to ask them for the same thing. Don’t send identical letters. Tailor each letter to fit each trust, but keep the same basic information. Make sure you don’t submit different versions of budgets to different funders. Is it worth re-applying to a trust that has turned us down? It depends on why you were turned down, so try to find out the reason if you can. If your work is clearly outside the remit of the trust’s area of interest then it would be a waste of time to apply again. But if it seems that you were turned down because there was no money left, or it was the wrong time of year, then you can apply again after a reasonable period of time, say a year or so. Before you do that though, check that their policies haven’t changed in the meantime, and make sure that your application is updated. Trusts receive far more applications than they can fund. So don’t take it personally if you are rejected, it doesn’t necessarily mean your application was of poor quality. If a trust invites you to re-apply next year then make sure you do, as this means that they are interested in your work. How to build and improve relationships with funders Write and say ‘thank you’ as soon as you receive a grant or promise of one. Keep them informed about the work they are funding – send annual and other reports, press cuttings, photos, copies of leaflets and so on. Always acknowledge any previous support from the same trust. Invite them to visit your group. If you hold a launch or open day or special event, send them an invitation. Trustees and trust administrators say that the organisations they remember are those that are in touch when they’re not asking for something. The relationship you are aiming for is one where the trust knows your work, feels that its money is being well used and will be happy to support you again in the future. Further reading Tiny Essentials of Raising Money from Foundations and Trusts Jo Habib, published by White Lion Press. Available from Directory of Social Change (DSC) and other book sellers and possibly your local library too. Directory of Social Change Tel: 0845 077 7707 Website: www.dsc.org.uk South Yorkshire Funding Advice Bureau The Workstation 15 Paternoster Row Sheffi eld S1 2BX Tel: 0114 249 4343 Email: enquiries@syfab.org.uk Website: www.syfab.org.uk We can provide this information in other formats on request. Please get in touch to discuss your needs. Our information is produced for local community and voluntary groups. No permission is needed for limited reproduction if SYFAB is acknowledged. Large scale reproduction or inclusion in publications for sale must have written permission from SYFAB. SYFAB welcomes your comments and criticism. You can talk to any member of staff, or contact us by post, phone, fax or email. Registered Charity No: 1061118 Reg. Company No: 3030641 © SYFAB 2003 All rights reserved. Version 1