Evidence Review: Why restrict grants?

This review explores contrasting rationales for restricted and unrestricted funding – and whether they are substantiated by evidence. We found that:

• Restricted funding has not earned its place as the dominant funding model. Our evidence review makes it clear that funders’ preference for restricted funding ‘because it delivers’ rests on familiarity, not on evidence.
• The available evidence on the benefits of unrestricted funding is becoming compelling. As more funders give unrestricted, we can help to build and strengthen this evidence base.
• A change in practice by UK regulators would help inform analysis of long-term trends – for example by providing reliable quantitative data on the split between unrestricted and restricted income, which could be achieved through the digitisation of charity accounts.

For funders interested in offering unrestricted funding, we explore common obstacles and how 12 foundations have navigated them in The Holy Grail of Funding: Why and how foundations give unrestricted.

 Over the next few months, we will be:

• Producing a resource that supports foundation staff to make the case for unrestricted funding. This will draw from this Evidence Review and our wider work, including Get the basics right, which captures what more than 1,200 funded organisations think about how funders can reduce the time, effort and stress of applying for and managing grants.
• Working with partners to explore how we could collect reliable quantitative data on the split between unrestricted and restricted income across the UK

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