You don’t need us to tell you that there’s a lot going on in the world right now. In just the first few months of the year, we’ve seen federal elections in Germany, the controversial reelection of Alexander Lukashenko in Belarus, and, most notably, Donald Trump’s return to the White House. Trump’s recent economic decisions have seen global markets tumble, serving as a stark reminder how quickly global stability can be affected by a single shift in leadership.
At home, we’re fast approaching a year of Labour rule, with intense scrutiny of Keir Starmer’s cost-saving measures aimed at preserving our economy and his approach to foreign policy in a global environment that’s been particularly hostile of late. For charities, which rely on consistent donations and a stable environment, U-turns in political mindsets and legislation can have a direct and sometimes immediate impact.
Political shifts are nothing new, but recent changes feel more like abrupt swings from one end of the spectrum to the other, rather than gradual evolutions of ideology. As a result, charities need to pivot their approach at a much faster pace, which can be a real challenge for organisations of any size. Staying alert and up-to-date is always a must, but, what trends have we seen from the latest goings on? And, what can you do to best prepare for what’s to come?
Global shifts, local impacts
The impact that political shifts in one country and the knock-on effects that they have in others must not be underplayed一Brexit’s hefty toll on the UK is proof of that. The red tape has increased hugely, costing time, money and resources which many people or organisations simply don’t have spare right now. Likewise, Trump’s reelection and his aggressive stance on immigration and working practices is already causing a significant change in approach from some. An alarming number of high-profile businesses are scaling back or scrapping EDI and flexible working policies—some even resorting to scare tactics to enforce compliance. While these may seem like business-specific issues at first glance, these actions will no doubt ripple through the charity sector too, with funding, operations and workplace stability all thrown into question.
Though not always appearing directly related on the surface, these decisions can have a huge bearing on the Charity sector. For example, changing immigration policies can impact access to certain countries, perhaps not even allowing certain charities to access the country at all, which is particularly challenging for those working in aid agencies, who rely on being in specific locations to help where it matters most.
Donations can also be affected both positively and negatively, though in some scenarios there is no winner at all. It’s a political choice to go to war, and one that has charities on high alert, ready to step in wherever they can to reduce negative impacts. As such, conscious efforts are made to raise funds to counteract the extra demand on charity resources, however, a change in foreign aid strategy from a government has the capability to completely derail these efforts. In fact, within his first month back in office, Trump had already announced a freeze on funds for international aid agencies – halting the work and capabilities of countless organisations across the globe.
The landscape under Labour
We’ve seen first-hand from the examples above how political events overseas can dramatically impact how charities operate, particularly influences from the US. Unsurprisingly, this effect is mirrored in the UK too, with changes to our own government and the plans they make. While Keir Starmer’s Labour government is considered much less leftward-leaning than party representatives that have come before, their differing stances to the Conservative government are still key to what the coming years look like for UK charities and the sector as a whole.
Many of Starmer’s policies so far have seen him back up his intention of overseeing a sustained period of economic growth, while also focussing on issues such as social equity and sustainability, pledging cleaner British energy and greater self-sufficiency. This is cause for optimism from UK-based charities in these areas, with collaborative opportunities and potential new sources of funding on the horizon. At present, UK charities are having to work exceptionally hard to maintain the excellent services they provide, with the cost of living crisis driving up reliance on food banks, increasing homelessness and even pushing the charities themselves to ensure that every penny is spent as effectively as possible. However, as we know from actions of governments that have gone before, just because something is promised, it doesn’t always mean it is delivered to the scale that’s expected, or even at all. It’s also important to remember that with this shift in perspective, other charities that were previously backed by the Conservative government may lose funding, so it’s never completely clean cut.
Future-proofing: funding sources and scenario planning
As we’ve seen, changes of power and new legislation can mean changes both good and bad for charities. What’s for certain though, is that political movements will always happen, so we recommend charities look to future-proof themselves as best as they can.
Assess how different scenarios could impact your organisation in terms of your funding, potential policies and operationally, and have a plan of action for each. More often than not, the biggest risk for charities is relying too heavily on government funding. Where possible, we recommend focusing your attention on improving existing partnerships and donor engagement, or even sourcing new ones to provide a buffer against any unexpected policy-driven cuts.
It’s always advisable to keep an ear close to the ground, ensuring you’re up-to-date with the latest news and changes to legislation. You may wish to engage with sector bodies so that your organisation is involved in any potential discussions or ways to affect policies that may impact you.
Through all of this you should remain open and honest with your stakeholders, whether that be staff, volunteers, or trustees, ensuring they are informed of how you plan to approach any instances where political changes may influence how your organisation is run. This will only serve you well in the future, building trust, a sense of togetherness and strengthening internal relationships.
In reality, nobody has a crystal ball that can tell them where to focus their attention when things change, how to save their organisation when times are tough, or even what will happen tomorrow. Despite our best guesses, political upheaval and snap decisions will always test our resolve. While we can’t predict every political move, we can prepare for uncertainty. With thorough and considered contingency plans, diversified sources of funding, and a heap of collaboration across the sector, you will at least have some of the answers, even if you’re unsure of the questions that will be asked of you and your organisation in the future.
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