Catalyst Endowment loses momentum

Twenty-two of the twenty-nine organisations whose income is being monitored as part of the Catalyst Endowment match-funding scheme being run by the Heritage Lottery Fund (HLF) have failed to reach the fundraising targets they set for themselves in their initial funding applications, according to the latest report on the progress of the scheme. So far organisations have only been able to draw down £10.6m of the £36m match funding available to support endowments that aim to bring new private money into the heritage sector.

The report reveals that endowment fundraising is proving increasingly difficult as the scheme progresses. Whereas only nine of the sixteen organisations admitted to the first round of the programme in 2012 were falling short of their fundraising targets after the first year, a year later that figure had grown to twelve. Of the thirteen who joined the programme in the second round during June 2013, only two were behind schedule prior to their first fundraising milestone, but that figure is now ten. Those in the first round now have just six months left to achieve their fundraising targets, while second round organisations have until May 2017.

Organisations admitted in the first round, however, have experienced a change in the profile of their income. Individual donors giving £5k or more per year are now their most significant source of private revenue, followed by grants from trusts and foundations. In the previous two financial years trading income was top, but according to the report, this is now a far less significant revenue stream. There has been no change in digital giving/crowdsourcing, which has failed to get off the ground at all.

Although HLF has committed to sharing the findings from the monitoring and tracking work that is ongoing through the Catalyst scheme, and to publishing annual reports every December until 2017, the two reports released so far share few details of the financial impact of the scheme. Its latest report was completed in February 2015, but not published until August. It is described as reflecting “a mixed picture of progress at a challenging time for organisations taking on a fundraising campaign”.

HLF is giving no details of individual organisations’ progress during the grant period, with the exception of HMS Victory, which drew down its £5m grant  in 2013. A spokesperson told AP: “Many organisations are reporting successes and there is evidence of significant learning about endowment fundraising which will be of long term benefit to the heritage sector… As Catalyst focuses on ensuring longer term financial resilience for organisations we expect that it will take time for the full impact of the programme to be seen.”

The Catalyst Endowment programme is a joint initiative funded by the DCMS, the HLF and Arts Council England (ACE). The HLF scheme has been running in parallel with a Catalyst Endowment scheme led by ACE, which has now ended and final claims for grant payments have been submitted. But ACE is proving equally reticent to release its figures. The 18 arts organisations offered a total of £30.5m, with a match funding target of £54.5m, were excluded from ACE’s first year review, so no interim evaluation of the scheme has been published. Unlike the HLF, neither has it published the value of grants drawn down as the scheme has progressed. AP has requested data from ACE, but this has been declined. A spokesperson said: “We will publish the data with the evaluation report later this autumn.”