An Oxford charity famous for fighting poverty is having to tighten its belt as times get tough in the financial slowdown.

Oxfam announced today it was looking to cut up to 15 per cent of its costs in the UK because of the impact of inflation on its operations.

Although it has not yet experienced a downturn in donations, it is also expecting them to decrease over the next three years.

This could mean it has to abandon some of its smaller projects and possibly make staff cuts.

The charity, which has its headquarters in Cowley, said some short-term savings would be considered but its cost-cutting efforts were focused on 2009 and beyond.

Spokesman Lucy Brinicombe said: "In light of the economic situation we are looking to cut 10 to 15 per cent of our total variable costs in the UK, starting from next April.

"As a charity with an objective of ending poverty, we always strive to be as efficient and cost-effective as possible.

"The current climate means we will be looking to make the most of every penny, even more so than usual."

She said the aim would be to minimise the impact on projects.

She added: "We will mainly be making cuts to support costs, such as travel and office equipment.

"We are determined these changes happen as part of our normal business cycle, so we're prepared for the impact of an economic downturn and have time to plan how to deal with it."

The charity, which relies heavily on public donations and proceeds of sales in its stores, was founded in 1942 as the Oxford Committee for Famine Relief.

Ms Brinicombe said Oxfam managers were in the process of working out how best to achieve the savings, saying: "Where possible, staff reductions will be achieved through not filling vacant posts, rather than redundancies.

"Oxfam's trade union is involved in discussions and planning.

"Staff are being kept informed through internal communications, including talks with the director and an online discussion forum."

Jane Cotton, the charity's director of human resources, added: "We are aware of the impact higher food and fuel prices are having on poor people in developing countries and we recognise the new economic reality will also have implications for Oxfam's work and resources."

Although some charity shops have reported reduced takings, Oxfam's Broad Street shop in Oxford said it appeared to be bucking the trend.

Manager Jan Tansley said: "Our donations are constant and more people than ever are coming in to look at our clothes."