Charities are being hit by government spending cuts while demand for their services have increased, new research has revealed.
The Garfield Weston Foundation said a study of nearly 200 charities in North East England showed that almost two thirds had been affected by cuts in funding.
Three out of five said demand for their services had increased in the past 18 months, while almost a third relied on government funding as their main source of income.
The foundation, a grant-making trust, is launching an award to help small charities in the region.
Jo Curry, chief executive of the Voluntary Organisations' Network North East, said: " This award couldn't come at a better time as the charity sector here in the North East faces a perfect storm of public sector funding cuts and an increase in demand for services.
"As charities reserves dwindle and staffing levels are cut, the safety net they have provided to vulnerable customers is now full of holes. Welfare reform is hitting the North East hard and charities are fire-fighting with fewer resources."
A Cabinet Office spokesperson said: "We know that times are tough for charities but we are determined to ensure as much money as possible goes to the front line.
"We are investing around £470 million over the Spending Review period to directly support charities and voluntary groups.
"However over three quarters of charities receive no money from the state, and we have an ambitious programme to ensure as many as possible can be self-sufficient by opening up new types of funding opportunities.
"We are also helping charities bid for and win more public sector contracts through new grants, workshops and legislation."