Charities feel the pain as donations tumble

Around 71 per cent of people said they gave money to a good cause during the year, donating an average of 110.20 each, according to Investec Private Bank.

But one in five people said they had reduced the amount they gave compared with 2008, while only 11 per cent claimed they had increased their donations.

Overall, the group estimates that a total of 5.32bn was donated to charities during the year, 574m less than in 2008.

Investec said the fall in income was likely to have been made worse for charities because of the low returns they are receiving on the money they hold in deposit accounts. Charities typically hold around 15 per cent of their assets in cash.

But the group said a third of accounts for balances of at least 50,000 that were aimed at charities were currently paying interest of 0.1 per cent or less, while only one in 10 accounts was offering returns of at least 2 per cent.

Jack Jones, of Investec Private Bank, said: "Charities, like many other sectors, have suffered through the recession and a drop in donations can adversely affect the good work they are doing. To compound this problem, many of the deposit accounts targeted at them are offering dreadful interest rates so it is important they shop around for accounts that are going to pay them a consistently attractive return."

The research found that nearly a fifth of the money charities received during 2009 was donated in December, and 8 per cent of people who gave money to a good cause during 2009 made all of their donations during this month.

People in Northern Ireland were the most likely to give money to charity during 2009, with 76 per cent making a donation, followed by those in Wales and the South West at 74 per cent.

But people in London and the South East donated the most at an average of 175 and 149 respectively.

At the other end of the scale, people in Yorkshire and Humberside were the least likely to give money to charity with only 62 per cent making a donation during the year.

They also gave the least at an average of just under 53. The research comes after Oxfam warned that it had seen a 15 per cent fall in the level of goods donated to its shops during 2009.

The charity said it was the second year running that it suffered a double digit drop in donations, after the level of clothes, books, toys and crockery people brought to its shops fell by 12 per cent during 2008.