THE Covid-19 pandemic has imposed huge difficulties on many charities. Demands for their assistance have increased as more people live in straitened circumstances, and public services have been stretched and squeezed, while at the same time the effects of lockdown have cut a swath through the charity sector’s finances.
In March, the analysts Legacy Foresight projected that, in 2020, charities would experience a drop in income from legacies, for example, of as much as nine per cent (although it still expected the market to grow in the longer term, from £3.2 billion to between £3.7 and £3.8 billion in 2024).
Legacy income is “notoriously difficult to forecast”, the head of legacy giving at the Bible Society, Howard Barker, says, but it is “incredibly important” to the society’s work, normally providing 20 to 25 per cent of the funds for its activity worldwide.
“We were very concerned about the impact Covid would have on all our donated income. We thought there would be a decrease in legacy income, but not necessarily immediately, because there is always a time lag. It’s not unusual for nine or ten months, or even a year, to elapse between somebody dying and their legacies starting to flow through to the charities. The concern is that it’s now going to be 15 or 16 months.”
In fact, the society has found that, so far, legacy income is “holding up”, although Mr Barker still expects “an impact” as the pandemic continues. “We are fortunate as a charity that, to some extent, if our income drops we can just dial things back a little bit if we need to, and do less.”
The international CEO of the Barnabas Fund, Hendrik Storm, also reports that, so far this year, its income from legacies “has been tracking to what we would normally expect”.
Pete Jones Legacy-giving is supporting St Luke’s for Clergy in their work to help clergy health and well-being
At the smaller end of the scale, the fund-raising manager of St Luke’s for Clergy, Samantha Appleby, says that this year the charity has received only about £6000, compared with £60,000 last year.“At the minute, it is definitely a concern. Once the pandemic hit, a lot of funding started to disappear, with churches being closed and events being cancelled; at the same time, we are dealing with a massive increase in referrals, mainly from mental-health services, because we offer counselling and therapy.” Fortunately, she says, St Luke’s has some limited financial reserves to draw on.
Open Doors UK and Ireland has found that donated income overall “has remained quite buoyant”, its legacy and trust fund officer, Helen Lofthouse, says. “However, we have noticed a dramatic shortfall in legacy income, which is currently about a quarter of what we received in 2019.”
She has also had notification of “only about 30” legacies coming through in 2021, which is lower than previous years. “Perhaps there is a tightening of the belt going on generally,” she says.
The Methodist Ministers’ Housing Society derives most of its income from rental, and is not dependent on income from legacies — which, in its case, has always been “completely random, although it is always very welcome”, its CEO, Mairi Johnstone, says.
Her budget for the current financial year, which began on 1 September, “very deliberately” does not count on any legacy income at all. “I think this may be a pattern for the future. It doesn’t mean that we won’t spend it as it comes in, and on really good things, but we’re just not making any assumptions.”
TEARFUND’s global fund-raising director, Jane Pleace, concurs with Legacy Foresight’s short-term pessimism and longer-term optimism. The agency’s legacy income has fallen short of its targets this year, she reports, as a result of “delays in receiving notifications of gifts, typically in wills that were written over five years ago, based on decisions made pre-pandemic”.
Clive Price/MMHSHaving a home provided for retirement often allows ministers to do something new: a house in north London available through the Methodist Ministers’ Housing Society, meant that the Revd Kathleen Richardson could serve at the House of Lords, after she became Baroness Richardson of Calow
She says, however, that “our expectation is that the value of legacy gifts will rise over the next five years, as the number of people leaving gifts to charities is expected to rise, and an eventual economic recovery should increase the value of estates.”
Ms Johnstone sees things differently, although she says that “Visibility is so low at the moment”. She suggests that the effect of the virus on legacy income “is going to come many years down the line”.
Generally, she says, people do not leave it until late in life to decide who they will leave their money to, and some will be influenced by what is happening now. “When they see what this pandemic is doing economically to the generation below them,” she says, “I think there may be less [left] to charities, and more to families.”
The immediate problems have largely been administrative. “The probate service was overwhelmed as a result of the excess mortality we’ve seen this year,” the consultant Chris Millward, of legacygivingexpert.co.uk, says. “Many grants of probate have gone missing, and we’re not quite sure what’s happening.”
Any expectation that the excess mortality of the past seven months would result in an increased flow of legacies has yet to be fulfilled. Executors are not getting grants of probate through as quickly as usual, Mr Barker says, and many solicitors were quick to put many of their staff on furlough.
Another factor has been a slowdown in house sales. Ms Lofthouse gives the example of “one lady whose father’s house is still on the market 18 months after he’s died. She just cannot sell it.”
The Revd Sam Chandler is secretary of the Anglican Society for the Welfare of Animals, which “normally only gets one or two legacies a year”. This year, she says, it has received two, but one of them was held up because the executors were waiting for a large house to be sold.
Mr Barker counters that the property market “has ended up not being too bad”, as the stamp-duty holiday has “counteracted” the initial slump in sales. Not only has the impact of the pandemic constricted the flow of legacies, but falls in property values in some parts of the country; and share prices have also, in many cases, reduced their size.
THERE has been a huge increase in the number of people writing a will this year, and figures suggest so far that these wills are no less charitable than in previous years. Are Christian charities actively soliciting legacies at present, or is that inappropriate during a pandemic?
bible SocietyA sizeable legacy received by the Bible Society largely paid for a children’s mission centre in Eswatini, in Southern Africa, which opened its doors last year
The Bible Society normally sends out an appeal every two years, Mr Barker says. “By chance, we were scheduled to do one back in February; so it was already rolling off the presses by the time we understood what Covid was all about. If it had been scheduled later in the year, we might not have sent it out. The last thing we would want is even to be seen to be trying to make money out of this horrible pandemic.
“Our fund-raising is very much: we hope that our supporters will love us and that, once they’ve looked after all their loved ones, there might be room in their will for something to us.”
Open Doors has taken a different approach. “We have really redoubled our efforts to broach the subject of legacies with our supporters,” Ms Lofthouse says. “I think people are much more aware of their mortality because of Covid. None of us can be sure we won’t get the virus.
“We are advertising on Facebook for the first time, aiming at people aged 55 and above, and asking them to be the answer to other people’s prayers in the future.” Obviously, she says, the charity will not see the effects of this effort until five or ten years down the line, “because that’s the nature of legacies”.
The charity OneBodyOneFaith has also embarked on a new legacy campaign. “Our gut instinct is that this might be a good time to talk to people about where their money goes after they die,” the executive director, Luke Dowding, says, “but we had been hedging our bets depending on the public mood. It’s a bit of a tricky balance between getting the message out there, and being sensitive to how people are feeling.”
In the past, he says, the charity reminded its membership and supporters about the option of leaving a legacy “once every two to three years, but not with any great consistency”. Having observed secular charities running legacy campaigns, in October OneBodyOneFaith included information in its regular communication to members about “leaving us something in their wills”, and also “started to drip-feed it into social media and our website,” he says.
“Of course,” Mr Dowding admits, “we might get a load of people saying, ‘Why have you sent this out now? How could you be so callous?’, but, after two weeks, we have yet to have any negative feedback.”
In contrast, St Luke’s for Clergy has decided not to have a legacy drive this year. “It is always difficult talking to people about the end of life,” Miss Appleby says, “and, obviously, a lot of people have been negatively impacted. Many people choose to leave us a legacy of their own accord, anyway, and I think people are noticing a lot more what different charities are doing, and how it impacts their communities.”
Mr Millward, who is currently working as a consultant to the charity Leonard Cheshire after a six-month contract with Christian Aid, believes that the disruption the pandemic has caused presents Christian charities with an opportunity to look differently at the very notion of a legacy.
“I don’t think it’s just about whether we make that ask once a year, or in everything we do. I think it’s about how we engage with our supporters, and show ourselves to be people who will honour the commitment they make, to deliver the impact they want to see in the world.”
Many people are more conscious of their own mortality now, and are anxious to make sure that, if the worst should happen to them, they will be as well prepared as they can be. Mr Millward suggests that charities can offer to help them to write their wills “not as an ask, but as a service, as a way to help people to get their end-of-life admin in order, to reflect on their lives and their values, to face death in a more positive way, and to leave a legacy that will help to shape the future”.
Christian charities, he suggests, already have “a language, a tone, a relationship they can draw on. Legacy giving is about meaning and purpose, connection and community, faith and hope. The reductive approach that we too often take is a disservice.”