Salvation Army reports giving down as charities deal with economic crisis
Published Sunday, October 26, 2008 5:25PM EDT
TORONTO - A major Canadian charity is struggling to deliver services as its critical holiday donation period approaches due to a decrease in financial gifts and an increase in the number of people seeking help amid a global financial crisis.
While the Canadian Red Cross, the United Way and Canadian Cancer Society are among those who say they're monitoring the financial crisis but still are unsure of its effect on operations, the Salvation Army of Canada says the economic situation has already hit its bottom line.
"We're seeing, really, an increase in demand for services and a decrease in total donations, particularly in our food banks and utility assistance programs across the country," said Salvation Army spokesman Andrew Burditt.
It's a worry for an organization that provides social services in more than 400 communities across the country as the holiday giving period draws near.
"As that season approaches, there is concern that the demand will increase because obviously we have growing costs. Individuals families are struggling to pay fuel, utility, food bills, etc.," Burditt said.
In Merdian, Alta., food bank supplies at the Salvation Army's care centre are being depleted as the number of daily users has nearly doubled from 15 to 28.
In Wallaceburg, Ont., located in Ontario's hard-hit manufacturing heartland, the group's food bank saw a 25 per cent jump in the number of households using its services between June and July alone, and a 20 per cent increase in new requests per month.
Aside from direct donations, the Salvation Army is also able to generate revenue through its second-hand thrift stores.
The demand in that area appeared to be "consistent," Burditt said. Several U.S. media reports suggest business at thrift stores south of the border is booming as people try to save money in hard times.
Other Canadian charities say it's too early to say what impact the sagging economy will have on their work.
"What you don't know is where it'll end up," said Bonnie Morris, a vice-president with the United Way of Canada, which raises upwards of $480 million annually.
"If people are no longer employed then they may not be in the workplace to make the contribution that they did, but we just don't know yet," Morris said.
"The returns that are in are good, in fact some of them are even ahead of previous years."
The organization hasn't yet noticed any regional differences in giving but expects there will be, especially in areas where there have been plant closings.
Heather Badenoch, senior public relations adviser with the Canadian Red Cross, says "lots of things affect rates of giving."
Canadian generosity shone earlier this year after campaigns to aid victims of the Myanmar cyclone and Chinese earthquake disasters raised a combined total of more than $50 million, Badenoch said.
Douglas Lamb, a personal financial planner in Toronto, believes people fall into two categories when it comes to charitable giving -- those with long-term budgets, and those without.
"Of course charity is discretionary," Lamb said.
"It's the people without a plan...(who) probably panic and shut the tap off, but I think the serious givers are probably people who have a plan and incorporate that into their plan."
But he admitted the situation is different for someone who has lost their job, dramatically impacting their cash flow.
"Obviously they would probably adjust their charitable giving," he said. "It's all a matter of degree."
Lamb noted many people have emotional attachments to their charity of choice, something the Canadian Cancer Society can attest to.
"Everyone knows someone who's been touched by cancer," said corporate development director Lesley Ring.
Even in times of past economic trouble, Ring said Canadians have continued to support the work of the society, which received nearly $200 million in donations in its last fiscal year.
"Canadians will still continue to be diagnosed with cancer," Ring said. "So our needs to fund research, to provide support to Canadians will continue."
Even in tough times, people tend to continue spending on some discretionary items that make them feel good, whether it's clothing, alcohol or something else, Lamb said.