That is a misunderstanding of what is now more accurately called the third sector. Almost all the organisations within it are charities and some of them depend on volunteers to carry out their work.

Increasingly, however, they employ professionals and provide specific services to local authorities and government agencies under contract.

Nevertheless, they continue to fulfil the traditional role by reaching into society’s forgotten corners and picking up the pieces when individuals fall through the official safety nets.

To do so, they still rely on donations. Over the past 25 years Lloyds TSB Foundation for Scotland has become a major independent funder, giving almost £85m to charities across the country. Around £30m has contributed to salaries, typically in grants of around £5000 towards the cost of an outreach worker, playworker, or co-ordinator of volunteers.

The news the foundation will not make any new awards for the foreseeable future, therefore, puts hundreds of social projects across the country at risk,

That includes the Partnership Drugs Initiative, which, since 2000, has received £14m from the foundation for work with children and young people on drug and alcohol misuse.

That project, which was in partnership with the Scottish Government, has been a bold example of the advantages of secure funding.

Drugs and alcohol misuse is not a particularly popular cause and therefore difficult to raise

money for, and yet resultant problems, including child neglect and crime, cause misery across society. The foundation was able to commit £500,000 each year to the initiative because Lloyds Banking Group is required to distribute 1% of pre-tax profits, to its foundations across the UK, with Scotland receiving 19.46% of the total.

The problem is the group does not expect to make a profit over the next few years and has cut its charitable arm accordingly.

That commercial logic is unfortunately at odds with the social reality. It cuts off a major funding source from charitable organisations at the very moment that there is the greatest need for their services.

Organisations such as the Citizens’ Advice Bureau report an increase in people seeking help with debt and homelessness. The seriousness of the situation can be measured by the fact that the Scottish Government has set up a £1.7m resilience fund to help charities and voluntary organisations combat the recession.

Local authorities must make severe economies and are likely to cut support for the voluntary sector before their own services and other sources of funding have also been squeezed.

Donations to charities have already gone down in both number and amount, and other charitable trusts have lost so much on the value of their shareholdings that they have also been forced to suspend or reduce grants. Although more people are taking part in the national lottery, the diversion of lottery funding to the London Olympics will prevent any significant boost for charity.

Scotland’s third sector puts £4.1bn a year into social projects and the financial crisis has put much of that work at risk. Times are hard, but that is all the more reason to make giving to charity, whether financially or by volunteering a higher priority.