Scotland's charity sector is restructuring — but are social enterprises filling the gap?

Scotland's charity sector has been under severe pressure. The Scottish Council for Voluntary Organisations (SCVO) has described the situation as a "slow-motion apocalypse", with more than 1,000 charities closing each year since 2023 and 16% of Scottish charities shutting their doors since 2020. Individual giving has fallen by 30% in real terms since 2018 and state funding has dropped by 5%. In February 2026, the Scottish Government announced a new formal partnership with the voluntary sector. We used the UK Third Sector Spine — a dataset covering over 700,000 civil society organisations — to examine what the data shows.

Figure 1 shows how charity registrations and de-registrations across England, Scotland and Wales have deviated from their 2015–2019 baseline. All three countries saw registrations dip during 2021–2022 before recovering. The de-registration picture is more striking: Scotland's charity de-registrations surged to 53% above baseline in 2023 and 73% in 2024 — far exceeding England and Wales. However, 2025 brought a sharp reversal: Scottish de-registrations dropped back to just 7% above baseline, while registrations returned above baseline for the first time since 2017.

Figure 1. Charity registration and de-registration trends across England, Scotland and Wales, 2015–2025

Figure 2 zooms into Scotland, comparing charities with Community Interest Companies (CICs). CIC registrations have grown steadily and accelerated sharply in 2025, reaching 132% above baseline — 506 new Scottish CICs in a single year. Charity registrations also recovered modestly. On the de-registration side, charity closures fell significantly in 2025, but CIC dissolutions remained very high at 134% above baseline. CICs are forming much faster than charities, but they are also closing at a much higher rate.

Figure 2. Registration and de-registration trends for charities and CICs in Scotland, 2015–2025

After two years of historically high closures, Scotland's charity sector showed signs of stabilisation in 2025. But the picture is more nuanced than simple recovery. CICs are surging — new Scottish CIC registrations more than doubled their pre-pandemic baseline — yet their high dissolution rates suggest many are short-lived. The sector is restructuring, not just shrinking. Whether the Scottish Government's new partnership can support this transition depends on the commitments that follow.

Explore the UK Third and Civil Society Sector Database: https://uk-third-sector-database.github.io/data/