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The economic crisis has put finances under pressure - but, as Emily Ford reports, many charities are finding ways to protect training budgets and make the money go further

Training managers often complain that their budgets are the first thing to go in a recession. But after 15 years of steady investment in training in an increasingly professionalised third sector, that does not appear to have held true this time - at least, not to the same extent.

"In past recessions, training was always one of the first areas to be cut," says Will Campbell, principal learning and development consultant at the Management Centre, which runs training courses for charities. "But now organisations value training as a priority, especially if they are having to make redundancies."

But as charities strive to protect front-line services, training budgets have not escaped the knife. For its Learning and Talent Development Survey 2010, the Chartered Institute of Personnel and Development asked third sector training managers about their budgets. Thirty-nine per cent of respondents said their budgets had been cut since the recession began, 44 per cent said their budgets had stayed the same and 16 per cent said budgets had increased. Campbell estimates that the charities he works with have reduced their training budgets by an average of about 10 per cent. However, some have been hit harder than others: one organisation surveyed cut its training spend by 75 per cent.

Charities are no longer sending all managers on general training courses, according to Campbell. "Organisations are not going for what I call the 'sheep dip' approach to training," he says. Instead, more charities are opting for individual and small group coaching sessions that address specific weaknesses, particularly in senior executives. "It's a time when leadership is really under the spotlight," says Campbell. The sector also appears to be taking a day-by-day approach to spending - the average advance booking period has dropped from about six to three months.

In its Economic Outlook research, published in April, the Chartered Management Institute found that 23 per cent of charities were concentrating their spending on 'core' internal staff. Elaine Smethurst, head of workforce development at sector umbrella body the NCVO, says it is important to continue spending on key staff members. "Essential training, such as inductions and compliance and health and safety training, has been preserved," she says. "But anecdotally, the general development of leaders and managers has suffered." This, she says, is a mistake: "Training is not an additional spend - it is a necessity, and even more so in a recession."

A reduction in budgets does not necessarily mean the quality of training has to suffer, according to Smethurst. "Charities are finding cheaper ways to provide development for staff," she says. "This includes job shadowing across functions, sharing skills with other organisations, employee mentoring and e-learning, particularly for volunteers who can't commit to full courses."

Chrissie Wright, director of training services at the Directory for Social Change, says there has been a 15 per cent fall in the number of people taking its courses - but there has been more interest in its courses on change management and the legal issues involved in redundancies.

The RNIB has had to cut its training budget by about a quarter "for the foreseeable future", says Corinne Leech, people development manager at the charity. But she says training remains an absolute priority.

"The RNIB had to ration resources across the board, like all similar organisations," she says. "We have tried to develop knowledge sharing among colleagues and encourage staff to take more control of their personal development needs. By using specialist knowledge already held internally, we've reduced our reliance on external training agencies."

Many major charities with large training budgets have managed to protect their spending. Leonard Cheshire Disability, for example, has focused on reducing unnecessary expenditure, but has not cut its training budget despite a £2.4m drop in income between 2008 and 2009. It recently sent 2,000 members of staff on e-learning courses, where training is delivered online to staff at their desks, and 95 per cent of them said they preferred e-learning to conventional training.

Scope reduced its training budget by 8 per cent in 2009/10 compared with the previous year. Jan McCarthy, head of human resources at the charity, says this was achieved mainly because of redundancies. But Scope has introduced some new training in the recession, including courses for its store managers. "We are offering an NVQ to make them more effective," says McCarthy. "That's having a really positive impact."

Low-cost solutions

The big question is whether the sector is over the worst. Many charities depend on state funding, so training budgets might not survive cuts in public spending. Jane Slowey, chief executive of the sector skills council Skills - Third Sector, believes that the worst is yet to come, but adds that innovation in training is helping.

She says some employers are finding low-cost solutions and dipping into other budgets, and others are exploring e-learning, especially for volunteers or staff who are working remotely.

The CIPD's survey found that people in the third sector were more optimistic than those in the public sector about the immediate future. Sixty-one per cent of voluntary sector respondents to the survey said that the learning and development climate would get worse, compared with 77 per cent in the public sector and 58 per cent in the private sector.

John McGurk, the CIPD adviser on learning and talent development, says training is vital to help charities adapt to changes yet to come. "Because of cuts to the public sector, the role of the third sector will be expanded," he says. "And if there are charity mergers, then people will require more training. This will be a real opportunity for learning and development people to show what they can do."

Reducing training budgets is a "productive constraint", he says: "Belt tightening can have the positive effect of forcing you to think more creatively." The areas to cut are the corporate-style away days or anything that could be seen as frivolous, he says. "As one executive said, is it really necessary for managers to discover themselves on a golf course?"

THE SEVEN CS OF THE TRAINING BUDGET

By John McGurk, adviser on learning and talent development at the Chartered Institute of Personnel and Development

- Communicate

Make sure people understand the rationale behind the training. Why is it necessary? How will it be delivered? What are the costs and benefits?

- Calibrate

How does the training fit in with your overall training goals? Can you justify the cost? How does it fit with the charity's mission? Talk to staff about what they want and develop an appraisals system.

- Cascade

Can the training be 'cascaded' through the organisation by managers and employees? They don't need to be trainers themselves so long as they can demonstrate what they have learned and how it is relevant.

- Chunk

Breaking things up into in small bits of information is a good way of engaging people. If training needs to be classroom-based, make it snappy. A two-day course can be delivered in five or 10 modules. It's when people start applying the training to their everyday jobs that it really takes off.

- Collaborate

Get people into teams, or move them around different departments. Share knowledge relentlessly across the organisation, and work with other charities to share and develop resources.

- Coach

Coaching helps people in senior roles to deal with the transition into new roles, and is also a great development tool for boards when used in a team setting.

For line managers, the ability to use coaching and mentoring is an excellent skill. It can help to encourage learning and is an effective tool for performance and engagement.

- Cost

Take all the costs into account, and don't spend just because you have a budget. Be creative, but begin with the end in mind. What are you hoping to achieve? What will success look like?

Source: Third Sector