IN TIMES of recession, wealthy individuals who find they are no longer able to make money start to think about giving it away.

That's not just wishful thinking. According to a new report aimed at the non-profit sector, philanthropic donations have proven "surprisingly resilient" to stock market crises, with rates of philanthropy in the US actually rising after financially traumatic events such as the bombing of Pearl Harbour in 1941, the oil crisis of 1973 and the September 11th terrorist attacks in 2001.

Although there is little historical data on large-scale philanthropic donations in Ireland, non-profit sector specialists 2into3 say that given it is still in its infancy here, "planned giving" in the form of major gifts is still set to increase.

But the non-profit sector may suffer from a reduction in the smaller donations from traditional mass appeals, as Irish households are squeezed by recession and non-profit organisations cannot afford to be complacent, warns 2into3 director Dennis O'Connor.

"The Irish have always been very good at giving, but in the current climate it would be ill-advised to rely on personal contributions from individuals who may themselves be experiencing the effects of the economic decline. On the other hand, philanthropists tend not to give simply when times are good, but continue to provide support through financial downturns," he said.

So far the Irish philanthropy flag has been flown by individuals such as property developer Niall Mellon, who in 2002 used his own funds to start building houses in South African townships.

But philanthropy in Ireland is "a relatively young enterprise", according to the Funding in a Cold Climate report, which cites statistics showing that only 12 per cent of the population donates to non-profit bodies in a planned way.

There are an estimated 24,000 non-profit organisations in Ireland employing more than 63,000 full-time and part-time workers. As an industry, this "third sector" contributes more than €2.5 billion to the economy and employs 8.8 per cent of the workforce.

As Ireland's wealth is relatively recent, there are fewer "legacy" donations from the estates of rich individuals, meaning this wealth has time to recover from setbacks created by the credit crunch's decimation of equity markets, the report says. It adds that in difficult times, donors become keener to check that the full amount of any donation is going to the charitable cause, with minimal overhead costs deducted.