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They might bring in £230 million in economic value to the island – but as many as a third of the island's 775 charities have less than three months reserves and are therefore “vulnerable” to financial stress and short-term shocks, a groundbreaking report into Jersey's third sector has found.
The 'Value of the Third Sector' report has been undertaken by PwC Channel Islands after being commissioned by the Jersey Community Foundation in partnership with Jersey Overseas Aid and the Jersey Community Partnership.
For the first time, quantitative data and survey responses from organisations have been combined to provide a comprehensive overview of the sector, its challenges and its opportunities.
This comes as charities as several charities have been plunged into financial difficulties by the rising cost of living. This summer, mental health charity Jersey Recovery College was forced to close "with immediate effect" due to rising costs compounded with a reduction in income and donations, and other charity heads have previously warned that when third sector organisations fold, islanders risk their services getting picked up by the Government at a "significantly" higher cost to the taxpayer.
The 'Value of the Third Sector' report also found that 37% of organisations either never or rarely engage with elected members, while 44% either never or rarely engage with public policymakers. Of those which do engage, only a third believe their engagement has at least a moderate positive impact.
"This underscores the need for more effective dialogue and consultation with third sector organisations regarding public policy," the report said.
It said this also gestured towards "the need to put the third sector on an equal footing with the private sector which is routinely consulted and involved in policy making" and called for Government to consider appointing a "dedicated individual responsible for representing its interests" in the States.
One survey respondent said: "Far too much 'heavy lifting' is being 'outsourced' to charities by the Government at the moment, with no recompense."
Pictured: an overview of the report's findings.
Jersey's third sector comprises at least 775 organisations and contributes at least £230 million in economic value.
If counted as a sector in its own right, the report found, the wider contribution to Jersey's economy would be the equivalent of almost six times the contribution of the agricultural, forestry and fishing sector (contributing £39.7m).
More than 7,700 islanders are either employed by or volunteer for these organisations, which is equivalent to around 12% of the island's workforce.
And across all third sector organisations, it is estimated that volunteers provide the equivalent of 1,700 full-time jobs.
The sector's total local estimated expenditure is approximately £190m, with registered charities reporting £139m of expenditure in 2023.
The report said: "One clear outcome evident from the survey is that Jersey's third sector is indispensable to the island's economic and social fabric.
"This report highlights the need for collaborative efforts to ensure the sector's sustainability and growth. By embracing innovation, celebrating best practice, diversifying funding sources, and fostering closer collaboration with both the public and private sectors, Jersey's third sector can continue to thrive and make a significant impact on the island's future."
Pictured: organisations were asked to describe the state of their reserves.
However, 37% of organisations have less than three months of reserves, "indicating vulnerability".
The report said: "With over 50% of third sector organisations only having free reserves to cover up to six months at most, short-term funding issues could quickly become problematic."
Lisa McClure, Partner and Jersey Office Leader with PwC Channel Islands, commented in the report.
She said: "There is limited understanding, both in government and amongst the public, of the positive contributions made by the third sector as a whole.
"This in turn hampers the sector's ability to foster collaborations and innovations, secure sufficient resources and effectively drive change over the long-term."
She said the report serves as a "call to action to support the sector" and it sets out forward-looking recommendations for the sector itself, for government, for islanders and the wider community, and for business.
Charities which took part in a survey mentioned a number of challenges, one being "frustration over a lack of financial and infrastructural support from the government", specifically relating to property maintenance, regulatory compliance, and the costs of insurance and fees.
One respondent even called for a dedicated States-level champion to advocate for the sector and for more streamlined and responsive governmental processes.
The report therefore makes a series of recommendations, some of which to Government, about how to overcome these challenges.
It advised officials to champion the sector in public policymaking, proactively nurture and support the third sector, and engage with the sector and build strong, long-term and collaborative partnerships.
"Consider appointing a dedicated individual responsible for representing its interests", the report added: "This role should focus on integrating third sector perspectives into the policymaking process. This approach provides the sector with a more structured and permanent voice in government discussions."
It also made a series of recommendations to the private sector, encouraging companies to build how they will support Jersey's third sector into their organisational strategy and purpose, incorporate the third sector into procurement decisions and encourage and incentivise more skills-based volunteering.
The third sector, meanwhile, was also encouraged to develop a long-term vision and share resources.
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