Covid-19: charities need urgent financial help - or many will collapse

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Trade union Unite is calling for the UK government to step in to provide a lifeline for the sector which has been hit hard by Covid-19

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3rd April 2020 by Graham Martin 1 Comment

Charities and voluntary groups need an urgent financial support package – or many face imminent collapse.

Trade union Unite is calling for the UK government to step in to provide a lifeline for the sector which has been hit hard by Covid-19.

Just as demand for charities’ services – from mental health to housing and more — are seeing an unprecedented rise amid the coronavirus epidemic, their fundraising opportunities have collapsed.

The voluntary sector is now facing a funding crisis if it does not secure government support soon, with the National Council for Voluntary Organisations estimating that UK charities are set to lose £4.3 billion in the next 12 weeks.

While the Westminster government has announced unprecedented levels of financial support for businesses, Unite says charities and not-for-profit organisations have fallen through the cracks, especially those dealing with local government, social care, mental health, housing, homelessness, advice, community support, and international aid.

Unlike for-profit businesses, many charities have limited cash reserves from which to draw and so some face immediate threat of closure.

Unite is especially concerned for the tens of thousands of its members who work in the voluntary and not for profit sector who, as frontline workers in the coronavirus epidemic,  are risking their lives to help others — while working extremely long hours, often on low pay and on insecure contracts.

On top of this, many do not have access to personal protective equipment.

One Unite rep has raised the particular issues facing domestic violence charities.

“Spending more time at home is catastrophic for those experiencing domestic abuse, and the advice to remain at home is leading to a rise in the incidents of women experiencing domestic violence and coercive control,” the rep said.

“Women’s refuges are already working at capacity, and while the advice to women experiencing domestic abuse is always to reach out to support organisations such as Women’s Aid and Refuge for help, Domestic Violence charities urgently need more funding.”

Unite has also highlighted the fact that charities who are keen to continue helping amid a national crisis cannot avail themselves of the furloughed workers scheme, where the government has agreed to pay 80 per cent of workers’ wages. This is because in order to be eligible for the scheme, furloughed workers cannot work or even volunteer for the organisation that employs them under current arrangements.

Unite has joined calls for a specific package of government support for the sector, which should include emergency mobilisation funding for frontline charities and volunteers supporting the response to the coronavirus crisis in the UK and globally through grants with a swift application process.

It wants to see the creation of a stabilisation fund for all charities to help them stay afloat, pay staff and continue operating during the course of the pandemic which would be administered through the National Lottery. The union also wants confirmation that charities should be eligible for similar business interruption measures announced by the chancellor for businesses and access to government rescue schemes.

Unite national officer for the community, youth and not for profit sector Siobhan Endean said: “Our members are keen to play their part in combating the coronavirus which will impact on some of the most vulnerable in society. Demand for charities’ services, from housing to mental health, has greatly increased.

“The voluntary sector is facing a crisis in funding, while meeting an unprecedented demand to support our communities. Our members are working incredibly long hours, with a lack of personal protective equipment and under immense pressure.”

“We need urgent action from the government to ensure that the voluntary and not for profit sector and those employed in it are protected amidst the current crisis we find ourselves in.”

The Scottish Government has created a £20 million Third Sector Resilience Fund to help charities through the crisis. The fund will support organisations that already deliver services and products but find themselves in financial difficulties directly as a result of the coronavirus pandemic.

The primary intention of the fund is to help voluntary sector organisations to stabilise and manage cash flows over this difficult period.

Anna Fowlie, chief executive of the Scottish Council for Voluntary Organisations (SCVO), said: "Voluntary organisations are facing incredibly difficult decisions in balancing being able to help now whilst still being there to make a difference once the immediate crisis is over. Few organisations have the reserves to be able to survive a prolonged downturn.

"SCVO’s Third Sector Information Hub is updated daily with information on the funding available from government and others to help organisations through the crisis."

Do you need help due to Covid-19? Click here to see what assistance is available.

3rd April 2020 by Michael

We are a small charity turned down for the resilience fund. Not important we were told. The refusal letters they have are quite rushed they could tidy that up a bit. We’ve begun the process of getting ready to close down. I think we can make it 3 months more then if nothing changes we’ll begin as it’s irresponsible not to. We can’t fundraise or run meetings and campaigns - so that’s our thing. Shame we all enjoyed our wee Charity very much and the landscape in Scotland has been so well managed to allow us a space. We may find only the big boys are left and my opinion is we’ll be many years to recover all our small community groups. Sad as we did nothing wrong but are at risk of loosing our charity. I’m angry yes, I think I have that right, because we really cared about our cause and it’s been taken off us so suddenly. This virtual work from home is only for the lucky few or we’d all have been at it prior.