Thanks to simpler application processes, greater critical intervention and better collaboration between grantmakers, funding application numbers are beginning to recover. Jenny Ramage reports.

As we first reported back in August 2012 in this article by Alan Eagle, when the recession kicked in funding applications to trusts and foundations took an unexpected nose dive.

This took many funders by surprise. “Following the government cuts you'd expect to see a rise in applications to private funders in areas of distinct need, but in fact what we saw was the opposite”, said Garfield Weston Foundation’s director, Philippa Charles. “We saw applications from the North East decline by 40 per cent.”

False perceptions

After a series of discussions with funders around the worrying trend, the Foundation for Social Improvement (FSI) probed its member charities for insight into why so many of them had reduced or stopped making applications for grants. They found that decisions to do so were based, in part, on increased pressure on delivering frontline services, which drew the focus away from fundraising. 

They were also based on some wildly inaccurate perceptions about how much money funders had to give away.  

“A significant majority of respondents said that because there was less money in the system, they thought competition would be too tough and so it wasn’t worth them applying”, says Geoff Russell-Jones, charities & education officer at The Leathersellers' Company. “This is bizzare, because over the years since the financial crisis kicked off we have actually increased our funding. It’s gone from about £1m per year to just under £1.75m. So we’ve almost doubled it in that time. It's ironic because actually, if you’d applied this time last year it was almost an open door, as we were so desperate for applications.”

Stepping up

Sensing the need to intervene, some grantmakers were quick to respond. Alan Eagle, foundation manager at Santander UK Foundation (www.santanderfoundation.org.uk) wasted no time in overhauling the foundation's Small Grants (now ‘Community Plus’) programme, making it quicker and easier for charities both to apply and get an answer. It was a big hit - the foundation awarded over 250 grants totalling £1.25m in the first six months.  

Alan then turned his attention to the foundation’s Central Grants application procedure, which relaunched in October last year in the form of ‘Learn & Grow Money Skills’. What used to be a four-page, detailed application is now a one-page initial proposal. “I wanted to make the process really light touch, at least initially”, says Alan. “All I really need to know at that first stage is: what am I going to pay for; what activity will that actually be used for; which disadvantaged group will it help and how many; and what is the long-term impact?” This is the only written part of the application process; the second stage is a conversation. 

The advantages of this new, simpler procedure are two-fold: not only does it take applicants less time to complete their initial proposal, it also frees up time for Alan to give feedback and help steer applicants in the right direction. “One problem in the past was that when people asked for feedback, I couldn’t give it as I simply didn't have the time. They’d just have to wait a month and if they didn’t hear back, it meant they were unsuccessful. With the new application procedure in place, I have much more time to send out emails saying ‘you’ve not been successful because of x, y or z, but try again in a few months, or next year’”. 

Direct response

Elsewhere, many grantmaking charities have upped their offering in terms of critical intervention, providing skills and advice on top of financial support - Garfield Weston among them. “When we witnessed the decline in applications, we wanted to provide a direct response, to act early and adapt our processes”, says Philippa.  

“We also talked a lot with other trusts who focus on these areas, to work out how we can better partner/collaborate, so that we can co-fund programmes, and share information and resources.” 

In addition, the foundation launched an awards programme - The Weston Charity Awards - in the North East in partnership with Pilotlight, with winning charities being provided with strategy advice and mentors. Such was the success of the programme, the awards were expanded last month to cover the whole of the North of England.

Meanwhile The Pilgrim Trust, which saw a dramatic decline in the numbers of applications from social welfare charities - these being the hardest hit by cuts in government funding - doubled its efforts to tell people that it will fund core costs. "We’ve put out information online that we are still open for business, that we haven’t cut back on our funding and that we will fund salaries", says Georgina Nayler, the trust's director. "We’ve also gone out and talked to organisations and asked where we can help them."

Cottoning on

Those grantmakers that haven't already adapted their systems in response to the decline are at least starting to think about what they need to do to encourage more applications. “There is a trend towards trying to make things a bit simpler and more reactive”, says Geoff. This trend is manifesting in various ways, including:

- Shorter/‘friendlier’ application procedures;

- More collaboration/co-funding between funders;

- A greater focus on speaking to charities to find out what help and support they need;

- Provision of more advice, skilled volunteers etc;

- Greater availability of core costs funding;

- Greater availability of longer-term funding;

- Less onerous reporting requirements;

- More focused funding; and

- More publicity to raise awareness of available funding.

Happily, most funders are finding that their efforts are paying off: they are now reporting a reversal in the drop in applications. For Garfield Weston, numbers are back to where they were three or four years ago. Most others say there is still some way to go (for Leathersellers, numbers are back to around half of what they were before the decline kicked in).

The reversal indicates that the sector, having had the rug pulled away, is starting to find its feet again. “It suggests that charities are coming out the other side of the downturn and are starting to find survival mechanisms”, Alan concludes.