The rhetoric towards the charities sector has become increasingly warm under this Labour Government. However, moving past the language of partnership, the sector’s own data tells a story of funding and procurement gains being concentrated in a small number of large organisations, while the small charities that make up the vast majority of the sector are being squeezed out. Against a backdrop of declining volunteer numbers and cost-of-living pressure on donors, Brevia looks at what this means for the charities sector in Andy Burnham’s Britain, and we consider where the opportunity lies for those willing to act on it.
Brevia Not-For-Profit (NFP) is a dedicated division of Brevia Consulting, with a strong track record of providing public affairs and public relations support to trade associations, professional bodies and charities. If your organisation would appreciate a briefing on what these funding and procurement shifts mean for you, get in touch with the Brevia NFP team today.
A Covenant of good intentions
Labour’s first major act in the third sector was to publish their updated Civil Society Covenant. The Civil Society Covenant, published by DCMS, was co-designed through engagement with over 1,200 organisations and sets out reciprocal principles of recognition, partnership, participation and transparency between government and civil society.[1] Its October 2024 launch was framed by then-Prime Minister Keir Starmer as a ‘fundamental reset,’ backed by an extensive advisory board of sector bodies.[2] Case studies embedded in the Covenant, including the National Youth Strategy’s youth-led design process, the Greater Manchester VCFSE Accord, and Calderdale’s local VCSE strategy, show how place-based partnership can work well in pockets of the country.
The Charities Sector
A better understanding of the sector can be found by analysing data from DCMS’s UK Data Spine, the first comprehensive register of civil society.[3] This counts roughly 770,000 organisations, including 194,000 charities. Of those, 73.6 per cent are small (income £10k–£100k) or micro (under £10k). Yet major charities (£10m+) capture 67.5 per cent of all sector income despite representing just one per cent of organisations. Charity Excellence separately puts small charities at 95 per cent of the sector, sustained by an estimated 13 million volunteers UK-wide.[4]
This scale gap is natural in itself, as a national cause will always outraise a hyperlocal one. The risk is what it does to viability. Local and niche charities increasingly deliver frontline work for devolved authorities, from skills and training to counselling. If they can’t clear their overheads, that responsibility transfers back onto already-stretched local authorities.
The data further illuminates this: micro and small charities are ‘almost entirely absent’ from public procurement, where £1m–£100m organisations take nearly two-thirds of contracts and funding.[5] As previously mentioned, this is not intrinsically bad for the sector, but with demand on local authorities increasing due to further devolved powers, the role of local charities are likely to be increasingly important. As a result, small charities risk becoming trapped by the metric that weights scale over impact, leaving them especially vulnerable. It is telling then, that fewer than three per cent of small charities surveyed by Charity Excellence believe the Covenant will deliver real impact for them.
Volunteers and Fundraising: the same story
The issues facing small charities is compounded by falling volunteer rates. Formal volunteering has fallen from 27 per cent monthly participation in 2013/14 to 17 per cent in 2024/25.[6] Yet 94 per cent of Gen Z say they’d consider volunteering, if roles were flexible and skills-based.[7] Fundraising follows a similar path of uneven progress: Enthuse’s Charity Pulse 2026 found 77 per cent of charities saw income grow or hold steady in 2025, but the gains cluster in corporate partnerships and mass-participation events, the sort of channels that favour organisations with the staff and technology to run them.[8]
Where this leaves the sector
The Covenant was built on the input of 1,200 organisations and explicit promises on funding and procurement reform. The open question is whether it has the teeth to shift practice, or remains a statement of values without delivery mechanisms. For the small and local charities this affects most, the answer will come down to how well they can evidence their impact and position themselves for the funding and local devolution conversations ahead.
Speak to Brevia
Brevia Not-For-Profit (NFP) is a dedicated division of Brevia Consulting. We have a strong track record of providing public affairs and public relations support to trade associations, professional bodies and charities.
If your organisation would appreciate a briefing on upcoming changes in the sector, Brevia’s team is ready to help.
Discover how Brevia can help you and your organisation by contacting the Brevia Team on 020 7091 1650 or contact@brevia.co.uk
BREVIA CONSULTING PROVIDES STRAIGHTFORWARD POLITICAL ADVICE AND SUPPORT TO BUSINESSES AND CHARITIES.
[1] Gov UK, Civil Society Covenant, 17 July 2025, link
[2] Gov UK, Government partners with civil society to transform lives across the UK, 17 October 2024, link
[3] Gov UK, Research report: Mapping and Understanding the UK Civil Society Sector, 28 May 2026, link
[4] Charity Excellence, Small Charity Crisis – Vital And Under Threat, May 2026, link
[5] Gov UK, Research report: Mapping and Understanding the UK Civil Society Sector, 28 May 2026, link
[6] Gov UK, Community Life Survey 2024/25: Volunteering and charitable giving, 31 July 2026, link
[7] British Heart Foundation, Boom in young volunteers as survey shows Gen Z most likely to gift time, 25 August 2023, link
