In 2022/23, we saw an upturn in both voluntary and statutory income as the external financial climate stabilised.
Our operational income for 2022/23 totals £12.3 million compared to £11.2 million in 2021/22. This is an increase in for 2022/23 of £1.1 million and is predominately due an increase in income from charitable activities.
Donations and legacies
In 2022/23, donations and legacies contributed £4.8 million to overall income. This is a small increase from £4.6 million in the previous year. During the year, we changed the structure of the Income Generation team in order to create sustained growth in future years. In the next three years, ‘donation’ and ‘legacy’ income is budgeted to increase by 36%, 9% and 10% respectively.
Charitable activities supported by statutory income from local government and health organisations
Statutory income in 2021/22 is £5.9 million and makes up 52% of our overall income. In real terms, this an increase of £0.1 million against 2020/2021.
Throughout 2022/23, we have been able to recommence delivery of the majority of our outreach and health promotion engagement, however work with schools, GPs and Pharmacies still remains a challenge, with footfall and access still limited or restricted. The regrettable decision by the Westminster government to limit the Chlamydia Screening Service to women and girls has halved the target audience but not the KPIs. A big pressure on delivering to budget has been double digit inflation across the board, and much higher in key products like Chlamydia and Gonorrhoea testing kits.
We have managed to retain all of our integrated sexual and reproductive health contracts across England, We have also retained our suite of health board contracts across Scotland and continue with developing our service offering in Wales. Notwithstanding the challenges of emerging from the Covid pandemic, we have also bid for and won additional business including the Essex Wellbeing service, a new Young People’s Sexual Health Service in Essex, and a Fast Track Cities HIV “challenging stigma” service. We also await the outcome of the Integrated Sexual and Reproductive Service tender in Hertfordshire.
We have also focused upon re-formalising existing partnerships with our current strategic partners, as well as identifying and establishing relationships with new potential partners across the Sexual and Reproductive Healthcare economy, as well as new areas for statutory growth (e.g., Prisons).
Other trading activities
Trading activities have remained stable in the year. This is not a key area of income for the charity, and we therefore expect this area to stay flat over the years to come.
Operational income in this area is primarily from administration fees and training. Likewise this is not a key area of income for the charity, and we therefore we do not plan for any significant growth in this area over the years to come.
How we spend our money
Total expenditure for 2022/23 was £13.7 million. This is an increase of £2.2 million from 2021/22 and is in line with our budgeted position.
In 2022/23, we spent £11.0 million directly on charitable activities, representing 80% (82% in 2021/2022) of our overall expenditure. The reason for this small reduction in percentage terms is the needs for greater investment in infrastructure costs post pandemic. In the past year, we have spent:
- £4.1 million (£3.2 million in 2021/22) on Ending new cases of HIV by 2030
- £3.3 million (£2.8 million in 2021/22) on Being here until the last person living with HIV needs us
- £3.6 million (£3.3 million in 2021/22) on Making sexual reproductive health the national priority it deserves to be.
Cost are allocated in reference to our new strategy and for the purposes of comparison, the 2021/2022 financial data is restated across the current strategic aims.
The cost of raising funds was £3.1 million, making up 22% (18% 2021/22) of overall expenditure. The reason for this increase was our conscious strategic decision to invest in income generation to ensure we can fund the expectations of the new strategy. This investment in the income generation team is expected to see income from donations and legacies increase to at least £7.8 million by 2025/26.
Support costs in 2022/23 are £3.5 million (£2.9 million (restated) in 2021/2022). This represents 25% of total expenditure – consistent with the previous year (25%). We are focused on keeping our support costs in line with the needs of the services and to ensure value for money. These costs, which are made up of head office costs, IT, facilities, HR, governance, monitoring and evaluation, Equality Equity Diversity and inclusion, and Finance, and have been allocated across areas on the basis of staff whole-time equivalent. This is detailed fully in note 10 to the accounts. A full review of the costing and recharging model has been undertaken to ensure an accurate and fair process for allocating costs across Terrence Higgins Trust is in place. As the new strategy is rolled out, we expect to achieve greater economies of scale and as such the % of costs being spent on support should reduce over time.