When googling the words crisis and merger, you tend to get rather a lot of hits at the moment, but one story in particular stands out; two UK homeless charities—Crisis and OSW (Off the Streets and Into Work)—are in talks to merge. This brings together two of my favourite topics, homelessness and the structure of the voluntary sector.

Apparently, OSW has been having some financial woes and is struggling to find funding for its projects and core costs. This is not unique in the sector—the economic downturn has hit hard. In November 2009, a survey by Homeless Link (the English umbrella organisation), found that half of homelessness organisations had seen a drop in personal donations, and a over a third said that charitable grants and government funding had gone down.

Some might argue that these pressures are not a bad thing—that there are already too many charities working in homelessness. And to a certain extent they may be right; when I did some research into UK homelessness charities back in 2007 I was struck by the large number of organisation’s working in the sector—many of them doing very similar things, and probably duplicating a lot of each other’s work.

But before people get too angry—that’s very different from saying that there were too many services available. In fact in some key areas it was completely the opposite. With employment—the area where OSW operates—there was very little work being done, despite the key role it plays in moving people out of homelessness. So making sure that OSW’s work is sustained and this expertise is not lost is important.

And on paper the match-up with Crisis makes a lot of sense. Crisis’ income actually went up over 2008/2009 and its emphasis on soft-skills and its burgeoning network of activity centres ties in well with OSW’s work. In fact, it gets you thinking about whether they’d thought of merging before the financial situation got so fraught.

But according to research by the UK charity commission, published in September 2009, only 5% of charities had considered merging. Obviously, merging isn’t for everyone—it can be risky, affect income and brand, and reduce competition—but the fact that 95% of organisation hadn’t even considered it at all seems a bit shocking. In NPC’s report on mergers, one of the suggestions is for trustee boards to regularly consider whether a merger could help them to fulfil their charitable purposes.

That isn’t much to ask. Maybe it could help to reduce the number of ‘crisis talks’ in the future.