Investment Growth means bigger spend for Shetland Charitable Trust
Shetland Charitable Trust (SCT) is to boost spending by an extra £3 million next year thanks to unexpectedly large earnings from its investments.
When trustees agreed a new five-year financial plan in 2019, they anticipated funds might grow by £14m over the following 21 months to sit at around £321m. Instead, when 31st March 2021 arrived, they had grown by £135m to £442m.
The surge in value of external investments is largely driven by changes in consumer buying habits during the Covid-19 crisis, including increased reliance on digital technology and online shopping.
The strong growth in value continued through the first quarter of this financial year, reaching £495.5m at the end of June.
The increase in funds put the trust in a position to be able to revise its annual budget upwards to spend more on the good causes it supports to enhance quality of life in Shetland.
Meeting on Thursday, trustees backed the opportunity to set a new spending limit of £15m for 2022/23, up from £12m this year and a jump of 50 per cent on the £10m spent last year. The total spend will rise again in 2024/25 to £15.7m.
Most of the extra funding for the next three years is expected to go on requested repairs and refurbishment for the network of large community buildings run by Shetland Recreational Trust, Shetland Amenity Trust, Shetland Arts Development Agency and Voluntary Action Shetland.
SCT also helps pay the running costs of those organisations along with the rural care centres and over 40 Shetland-based organisations.
SCT chairman Dr Andrew Cooper said: “The remarkable success of our invested funds gives us an opportunity to tackle a long-held concern about meeting the cost of keeping many of our most prestigious community buildings up to standard. SCT is now able to step in and help get the backlog of work done so that these centres and venues can continue to serve us in the ways we’ve come to enjoy and expect.
“As we always say, we do have to be wary of a crash in the markets which can quickly reverse our fortunes and damage our spending ability. The trust gauges the success of its investments over the course of years rather than after a few very successful months.”
The basis of SCT’s five-year financial plan is to be self-sustainable by spending only what its investments produce in average growth above inflation. This is intended to protect the reserves against inflation to benefit future generations of Shetland residents.
SCT started out in 1976 with a pot of £81m from oil revenues and has since spent around £340m on community services. The focus continues to be on supporting people in need, especially the elderly, children and young people, as well as seeking to enhance Shetland’s environment.
Contact: John Robertson
firstname.lastname@example.org Tel: 07775 407 796
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