Understanding Core Costs: Why They Matter to Charity Funding Like PACSO's

At PACSO, we’re proud to support children and young people with disabilities and their families, through inclusive play and vital respite opportunities. While much of our funding rightly focuses on the frontline activities we deliver, there's a quieter part of our work that keeps everything running smoothly: our core costs.

But what exactly are core costs? And why do they matter so much, especially to small charities like PACSO?

What Are Core Costs?

Core costs are the essential, behind-the-scenes expenses that enable a charity to function. They aren’t directly tied to a specific project, event or service but without them, none of those things could happen. Think of them as the glue that holds everything together.

Some examples of core costs include:

• Staff salaries (for management, admin and fundraising staff)

• Office rent and utilities

• Insurance and compliance fees

• Training and safeguarding (including DBS fees)

• IT systems and communication tools

• Fundraising and finance management

While they may not always seem as exciting as our charity funding a new holiday club, these costs are absolutely vital to delivering high-quality services safely and sustainably.

Why Core Costs Matter

1. They Keep the Lights On (Literally and Figuratively)

Without core costs, there’s no office to plan from, no staff to coordinate services and no systems to track funding or ensure children are kept safe. Every session we run relies on strong infrastructure and that infrastructure needs proper support.

2. They Enable Growth and Innovation

When core costs are covered, charities can think strategically. We can invest time in evaluating what works, planning for the future, applying for grants and building new partnerships. Without this foundation, it’s hard to evolve or respond quickly to changing needs.

3. They Ensure Stability and Resilience

Charities face all kinds of pressures, from rising costs to unexpected crises. A secure core cost base helps us weather challenges and bounce back stronger, ensuring that families who rely on us can continue to do so for years to come.

The Charity Funding Gap

Many funders prefer to support direct project costs, the visible outcomes and immediate impact. That’s understandable. But this focus can leave core costs underfunded, putting stress on organisations and risking burnout, instability and inefficiencies.

At PACSO, we’re working hard to advocate for full-cost funding, where funders recognise the true cost of delivering excellent services, including the vital infrastructure behind them.

How You Can Help

• Support us with unrestricted donations. Even a small monthly gift helps us plan ahead and strengthen our core.

  
  

• Ask funders to support full-cost recovery. If you’re involved in grant-giving or know someone who is, spreading awareness makes a big difference.

• Share this blog. Let’s open up the conversation about what it really takes to make lasting change.

  
  

Behind every child’s smile at PACSO is a team, a plan, a space and a system. Core costs may not always be visible, but they are invaluable and they deserve to be recognised, respected and resourced.

Thank you for helping us make that happen.