Lancashire and Cumbria State of the Sector 2025 Headline Insights

A newly released State of the Sector 2025 report highlights the significant scale and impact of the Voluntary, Community, Faith and Social Enterprise (VCFSE) sector across Lancashire and Cumbria, while also outlining key challenges that could shape its future.

A Sector at the Heart of Communities

The data reveals a vast and diverse civil society landscape operating across the region. In total, there are 9,421 regulated organisations contributing to the social fabric of Lancashire and Cumbria. These include:

• 5,215 registered charities

• 935 Community Interest Companies (CICs)

• 1,903 Companies Limited by Guarantee

• 249 public mutual organisations

• 19 universities and further education colleges

Together, these organisations form a critical support system for communities, delivering services, advocacy, and innovation across health, wellbeing, and social care.

Understanding the ‘Microbiome’ of Civil Society

Beyond regulated organisations, the report introduces the concept of a VCFSE “microbiome”—a wider ecosystem of smaller, often informal groups that play a vital grassroots role.

Using an estimated rate of 3.66 organisations per 1,000 people, the sector is believed to include approximately 7,731 groups across Lancashire and Cumbria. This highlights the depth of community-led activity that often operates below the radar of formal registration systems.

With a regional population of over 2.1 million people, this density of organisations underscores how embedded the sector is within everyday life.

Key Challenges Facing the Sector:

Despite its scale and importance, the report identifies several critical pressures:

Financial instability

Many organisations face increasing costs without corresponding funding increases. Alarmingly, 19.03% are predicted to spend more than they receive in the coming year, raising concerns about long-term sustainability.

Pressure on medium-sized organisations

Organisations with incomes between £100,000 and £1 million are highlighted as particularly vulnerable. While they deliver high volumes of services, they often lack the financial resilience of larger institutions.

Volunteer burnout and sustainability

Volunteers remain the backbone of the sector, but sustainability is a growing concern. Over 28% of volunteers contribute more than 40 hours per week, increasing the risk of burnout and long-term disengagement.

Premises and infrastructure challenges

Rising rents, limited access to suitable spaces, and ongoing facility management issues are affecting organisations’ ability to operate effectively.

Inequalities within the sector

The report also points to differences in how organisations engage with wider systems, such as Integrated Care Systems (ICS). Smaller organisations often face barriers to participation compared to larger, more established bodies.

A Call for Strategic Action

To address these challenges, the report outlines a series of recommendations aimed at strengthening the sector:

• Supporting organisations to build financial reserves

• Providing targeted support for medium-sized organisations

• Launching youth-focused volunteer recruitment campaigns

• Addressing volunteer burnout through wellbeing strategies

• Developing shared spaces and facilities to reduce overhead costs

• Advocating for inflation-linked funding increases

• Creating funding application support services for smaller organisations

• Encouraging income diversification to reduce reliance on single funding streams

• Strengthening collaboration through networks like the Lancashire and South Cumbria VCFSE Alliance

• Preparing the sector for upcoming structural changes in local government and health systems

  
  

Collaboration as a Strength

Encouragingly, the report highlights a strong appetite for partnership working. Over 63% of organisations report working with five or more partners, demonstrating a collaborative culture that could be key to navigating future challenges.

Looking Ahead

The 2025 State of the Sector report paints a picture of a resilient but pressured ecosystem. While the VCFSE sector continues to play a vital role in supporting communities, targeted investment, strategic planning, and inclusive approaches will be essential to ensure its sustainability.

As the region moves through ongoing economic and structural change, the sector’s ability to adapt, and the support it receives—will be critical in shaping the future of community wellbeing across Lancashire and Cumbria.