Income at the development charity Voluntary Service Overseas has grown for the first time since 2016, latest figures show.
The charity’s accounts for the year to the end of March show overall income of £40.4m, up 17 per cent on the previous year.
It also breaks a downward trend that started after the organisation’s income peaked at £80m in 2015/16 before reaching a recent low of £33.3m last year.
Philip Goodwin, chief executive of VSO, told Third Sector that the charity’s income had been falling mainly because of the gradual reduction of its two main Foreign, Commonwealth and Development Office-funded programmes.
“The International Citizenship contract income, worth £22m in 2015, reduced sharply before the contract ended in February 2021,” he said.
“In parallel, our Volunteering for Development grant, and its successor Active Citizenship Through Inclusive Volunteering and Empowerment, reduced from £26.3m in 2015 to £9m in 22/23.
“While our income reduced, we have continued to focus on improving the lives of our primary actors, increasing our impact for the most marginalised over that period.
“In 22/23, our efforts to diversify income have started to reverse the decline in income with significant increases in non-UK restricted income – putting VSO back on an upward income trajectory.”
The organisation’s governmental income went up from £12.8m in 2021/22 to £19.3m last year, which included “an increase in the grants from the Ministry of Foreign Affairs of the Netherlands and a near doubling in income from UN agencies”.
The charity credits this increase, which accounts for the overall boost to its income, to “a longer-term focus on business development and income diversification”.
VSO said in May that it had decided to downsize its head office in response to the change in working conditions brought on by the Covid-19 pandemic.
In 2022/23 the charity had 7,786 volunteers across 35 countries, which is more than double the previous year.
The charity also showed an increase in people helped indirectly through its exploits, rising from 4.2 million to 7.4 million.
There was a minor decline in the number of people directly helped by the charity, dropping from just under 4 million to 3.5 million.
VSO said: “The increase in indirect reach is mainly linked to an expansion of our work to support active citizenship around the world with a particular focus on young people. Our portfolio of work continues to evolve.
“This year saw the start of new livelihood projects focusing on locally led climate adaptation, resilience and agroecology and the end of a few health projects.”
Writing in the accounts, Julia Lalla-Maharajh, chair of VSO, said: “From a financial perspective, our overall income has stabilised after the significant cuts in UK government funding over the last two years.
“We are hopeful that by continuing to diversify our funding sources and demonstrating the impact of our work, our income will start to increase over the coming years, enabling us to reach more people in more places.
“I am proud to be part of an organisation that this year alone has supported over 10.9m vulnerable people through its work.”
VSO specialises in sending volunteers and partners to empower communities in some of the world’s poorest regions.