Household expenditure linked to levels of giving new report confirms

Household expenditure linked to levels of giving new report confirms

News (UK)

The UK population is spending more on charities as part of a general increase in spending levels, according to a longitudinal study of giving .The  figures show the average weekly donation made by a UK household rose from £1.02 in 1978 to £2.42 in 2008, representing a 138% rise, taking inflation into account - but this rise was mirrored by a rise in household spending.

 How Generous is the UK? published by the Centre for Charitable Giving and Philanthropy (CGAP), which draws on data on household spending habits of more than 200,000 households over 31 years,  considers relative levels of generosity in the UK by looking at the connection between household budgets and donations to charity with generosity defined as a household’s likelihood of donating, combined with donations as a proportion of its budget.

Making reference to Aristotle, the Science of Generosity project at the University of Notre Dame states that “Generosity is proportionate to one’s resources, so it is not contingent on possession of great wealth.”v We now measure generosity by looking at the percentage of the household budget given away in the form of charitable donations.

The key findings are:

  • A household’s propensity to donate increases with its other spending;
  • More households at the top end of the expenditure distribution donated to charity in recent years than did in the late 1970s/early 1980s;
  • Their share of total donations also rose significantly, meaning that charities became more reliant on fewer, better-off households for their donations;
  • This reflects a general trend towards a more unequal distribution of household expenditure;
  • Among households that donate, households on lower budgets give more as a percentage of their spending than do households on large budgets.

Between 1978 and 1982, the richest 10% of households donated 22% of the total while the poorest decile provided 3%. But between 2004 and 2008, donations from the richest decile made up 31% of the total while those from the lowest expenditure decile only accounted for 2% of all donations.

This increase in the concentration of donations among fewer, richer households reflects the higher concentration of money among fewer households in the latter period.

However, Charities Aid Foundation’s (CAF) study, UK Giving 2010 found that of those households that donate, those on a lower budget give more as a percentage of their spending than households on larger budgets. Those in the bottom 10% donate approximately 3% of their household budget, whereas those in the top 10% donate around 1%.

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