The Scottish third sector touches the lives of people and communities across the country. It encompasses an estimated 45,000 voluntary organisations, of which around half are registered as charities. From small grassroots organisations active in sports, childcare, self-help and the arts to village halls, housing and major social care providers, the third sector plays a key part across all walks of Scottish life today.

This report looks at the financial health of the sector during 2012-13, and examines key trends.

Key statistics

Figures compare 2012 to 2013.

Annual income rises to £4.9 billion in 2013, its highest ever level
Expenditure up to £4.7 billion
Staff numbers remain at 138,000

(Source: SCVO 2014)

Sector Stats infographic: Community, social and economic development	£475m; Culture and recreation	£482m; Education and research £346m; Environment and animals	£184m; Faith-related (excluding Churches) £50m; General Charitable Purposes £186m; Health £406m; Housing £1.46bn; Law, Advocacy and Civic Organisations £104m; Social Care £1.22bn


The third sector’s turnover has grown to £4.9bn, having doubled over the last decade and risen by £300million in 2013. Spending by charities has also doubled in the last 10 years to reach an all-time high of £4.7bn. Larger charities and foundations are seeing the majority of income growth, while average growth across the sector stands at 0.8%. The sector is growing and spending more than ever to help people bearing the brunt of a bleak economy, public funding cuts and growing poverty and inequality.

This research report examines the latest financial health and key trends of the third sector. The findings are based on financial data from charities, housing associations and credit unions for 2012-13.

    • Turnover is now four times that of the Scottish food and drink industry (£1.03 billion) and equal to the Scottish creative industries (£5 billion)
    • The sector employs 138,000 people – as many people as the Creative Industries and the Energy Sector put together. Employment is concentrated in the larger organisations, with the largest 4% of organisations employing three-quarters of the sector’s staff. Social care is the biggest employer, followed by housing and health.
    • The sector’s total turnover rose by £300m, but this growth was concentrated in a few large organisations. Most of the sector saw their finances remain relatively static: on average, organisations saw only 0.8% growth, lagging well behind inflation.
    • Smaller organisations were once again more likely to see a deficit, and dip into assets. While two-thirds of larger organisations were able to generate surpluses, these were very small. Many large organisations are unable to meet their reserves targets and most of the sector’s largest employers and service providers would be unable to cover 6 months expenditure from reserves

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