IVAR – Why restrict grants?

From the IVAR website:

“This review explores contrasting rationales for restricted and unrestricted funding – and whether they are substantiated by evidence.

We found that:

• Restricted funding has not earned its place as the dominant funding model. Our evidence review makes it clear that funders’ preference for restricted funding ‘because it delivers’ rests on familiarity, not on evidence.
• The available evidence on the benefits of unrestricted funding is becoming compelling. As more funders give unrestricted, we can help to build and strengthen this evidence base.
• A change in practice by UK regulators would help inform analysis of long-term trends – for example by providing reliable quantitative data on the split between unrestricted and restricted income, which could be achieved through the digitisation of charity accounts.”