Core funding can provide voluntary organisations with an invaluable opportunity and the resources to plan, innovate, improve, provide some breathing space to think or just ensure a bit of security.
Based on previous research (our own and that of others), we put forward suggestions to help funders think about the benefits and challenges of core funding, and recommendations for how and when to offer it.

What is core funding?
There is no single prescription and the terms core costs, operating costs and central costs are often used interchangeably within the sector. They describe essential running costs: including support costs; income generation and governance activities.
We have the skills, we have the networks, we have delivered before and have a good reputation. We have more people coming to us than we can respond to. We just don’t have core funding.”

What matters most is that funders are crystal clear about what they mean by core funding and
they communicate this unambiguously with applicants.
The obsession with counting and numbers and not trusting the organisations to be able to deliver is based on a lack of trust and need for control on behalf of funders. I can understand this concern where there is public accountability, but for most of us independent foundations, we don’t actually need that level of accountability.”

Publications:
Thinking about... core funding
Ben Cairns, Chris Mills, Sarah Ridley
Thinking about... core funding draws on learning from our own and others’ research and interviews with key informants from seven charitable foundations providing core funding to shed light on why, when and how to use core funding.

Publications:
Sussex Community Foundation Unrestricted Funding Study
Eliza Buckley, Houda Davis
Sussex Community Foundation commissioned IVAR to carry out a study exploring the value of unrestricted grants made to four organisations working with children and young people in Sussex. This report highlights the findings of this study.
IVAR (2006) Servants of the community or agents of government, London: bassac
IVAR (2010) Big and small: Capacity building, small organisations and the Big Lottery Fund, London: Big Lottery Fund
IVAR (2012) Duty of Care: The role of trusts and foundations in supporting voluntary organisations through difficult times , London: Institute for Voluntary Action Research
Miller, C. (2012) The World has changed and so must we. F.B. Heron Foundation.
Stars Foundation (2013) Perceptions of trust, risk and collaboration within international funder- charity relationships, London: Stars Foundation.
Bolduc, K., Buchanan, P. and Huang J. (2004) Listening to grantees: What nonprofits value in their foundation funders, Center for Effective Philanthropy
Buteau, E. Buchanan, P. and Chu, T. (2010) Working with grantees: The keys to success and five program officers who exemplify them, The Center for Effective Philanthropy
IVAR (2013) Turning a corner: Transition in the voluntary sector, 2012-2013 , London: Institute for Voluntary Action Research.
Brest, P. (2005) ‘The rationale for modes of foundation support for non-profit organisations’ in A memorandum to the program directors, program officers and fellows of the William and Flora Hewlett Foundation
Weiler, J. (2006) ‘Core support’ in The F.B. Herron Foundation: Core support, F.B. Herron Foundation. Funder objectives Grantee 2 Grantee 1 Unrestricted grant possible Restricted grant more appropriate.
Abdy, M. and Bolton, M. (2007) Foundations for organisational development: Practice in the UK and USA.
Gregory, A. and Howard, D. (2009) ‘Then on-profit starvation cycle’ in Stanford Social Innovation Review, Autumn, 2009.
Buechel, K., Keating, E. and Miller , C. (2007) Capital ideas: Moving from short-term engagement to long-term sustainability, The Hauser Center for Non-profit Organizations, John F. Kennedy School of Government, Harvard University.
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