A new study to research the vital contribution made by small and medium-sized charities is underway.

The study, led by Sheffield Hallam University's Centre for Regional Economic and Social Research (CRESR) and commissioned by Lloyds Bank Foundation for England and Wales, will take an in-depth look at the social and economic role of small and medium sized charities operating at a local level in England and Wales.

There are 43,000 small and medium-sized charities* in England and Wales. They account for more than a third of all general charities and many provide vital services to people facing multiple and complex disadvantage, including homeless people, victims of domestic abuse and people battling substance misuse.

The Foundation invested in the study at a time when small charities are seeing rising demand for their service, yet are facing unprecedented funding pressures, due to cuts and complex and inappropriate contracting and commissioning processes for public service delivery.

Key questions will include understanding the role small and medium-sized charities play in tackling disadvantage, directly and in partnership with other local service providers, analysing their distinctive features in comparison to large charities, examining their value for money and wider social value, and looking at the most effective ways of funding them.

CRESR will work with the Centre for Voluntary Sector Leadership (CVSL) at the Open University Business School (OUBS), the Institute for Voluntary Action Research (IVAR), and Sheffield Business School (part of Sheffield Hallam University), to deliver the study, which will be published early next year.

Chris Dayson, senior research fellow at CRESR and lead for the study, said: "Small local charities play a vital role supporting some of the most disadvantaged people in society and increasingly have to fill large gaps in provision created by the deep and ongoing cuts to public services. But there is concern that their work is under-valued and poorly understood, particularly in relation to larger charities that have been much more successful at winning public service contracts to support key client groups. This research aims to fill a large gap in the evidence base about what it is that makes small local charities distinct and identify the value they create for their clients, communities and public sector bodies."

Paul Streets, Chief Executive of Lloyds Bank Foundation for England & Wales said: “Many small and local charities are struggling to survive due to unprecedented funding pressures and rising, more complex demand for their services. People who have their lives changed as a result of local charities know how indispensable they are, but many others don’t. With complex political and policy change ahead, it’s more important than ever that we are able to provide robust evidence to answer the question of why small charities are so important - not just for individuals and communities, but the taxpayer too, and to help make a clear and compelling case for why they must be supported.”

James Rees, senior research fellow at Open University Business School commented "The OUBS's CVSL aims to build capacity in the small and medium voluntary sector, and the findings from this study will contribute vital knowledge on the local contribution of these charities that will strengthen the role of leadership."

Leila Baker, head of research at the Institute for Voluntary Action Research, added: "When the most vulnerable in communities need help it is often those working in small organisations that are there or notice first - right at the hard shoulder of support. More than that, they step in and prevent degeneration and empower change. Research like this is essential to shed light and increase awareness and understanding of their value and contribution - work that is often assumed to be a provision of the state."

*Small and medium-size charities are defined by Lloyds Bank Foundation for this study as those with an annual income of £25,000 to £1million).