William Eichler 24 March 2020

Charities struggle to deliver public sector contracts as they lose £4bn

Charities and public services are more vulnerable to the Covid-19 crisis than was previously thought because of the squeeze on funding the former is experiencing as a result of the pandemic, study shows.

New research by charity think-tank NPC has revealed that 54% of charities surveyed delivered public sector contracts and 59% of these said they are cross-subsidising that contract with money from other sources such as fundraising.

However, due to the cancellation of many fundraising events and the closure of charity shops due to the coronavirus outbreak, charities are going to struggle to find the funds to deliver on their public sector commitments, NPC warns.

NCVO, a body representing the voluntary sector, reports that charities are set to lose more than £4bn over a 12-week period.

NPC’s State of the Sector 2020 report also found that charities are doing more in almost every area than 2017 and so may have been spread thinly when the crisis hit. In 2017, for example, 83% of charities said they were delivering services or products. In 2019/20 this rose to 89%.

Less than half (47%) of the 300 charities approached for the research - which was funded by PwC, Barrow Cadbury Trust, Lloyds Bank Foundation and Odgers Berndtson - believed that independent funders offered the flexible core funding which NPC expects will be vital to keeping them afloat in the crisis.

Charities’ confidence on their ability to use digital technology has dropped by 11% to 59% from 70% since 2017. This may leave them struggling to shift services online to reach isolated people during quarantine and social isolation, according to NPC.

‘Charities are mobilising to help thousands of people across the country but they are also crying out for more help and support. Their income is collapsing just as people’s need to use them starts to grow,’ said NPC CEO Dan Corry.

‘Our research reveals some underlying problems in the sector which the crisis will undoubtedly exacerbate. The response both from policymakers and the sector to the crisis needs to take this pre-existing weaknesses into account, and make sure issues like the lack of core funding, the weaknesses on using digital technology and the cross subsidy of contracts are not overlooked, or we could see charities fail and thousands of vulnerable people put at risk.’

SIGN UP
For your free daily news bulletin
Highways jobs

Senior Practitioner – Family Assessment Centre

Haringey London Borough Council
£43,860 – £48,819 per annum
This post is part of a specialist team working as part of the internal resource for... Haringey, London (Greater)
Recuriter: Haringey London Borough Council

Leader's Office Manager

Royal Borough of Greenwich
£40869 - £43860 per annum + n/a
Help us make Royal Greenwich a place where everyone can succeed and prosper. This interesting and unique job carries responsibility for managing the o England, London, Woolwich
Recuriter: Royal Borough of Greenwich

Social Worker – Family Assessment Centre

Haringey London Borough Council
£33,418 – £44,860 per annum
This post is part of a specialist team working as part of the internal resource for the conducting of... Haringey, London (Greater)
Recuriter: Haringey London Borough Council

Service Development Manager – Waste

North Yorkshire County Council
£39,880 to £43,857
As our Service Development Manager your core focus is to drive service improvement by seeking out opportunities for the County Council in... North Yorkshire
Recuriter: North Yorkshire County Council

Children's Services – Advanced Practitioner (Team Based)

Lambeth Council
£45,594
We are looking for reflective, dedicated social workers Lambeth, London (Greater)
Recuriter: Lambeth Council

Public Property

Latest issue - Public Property News

This issue of Public Property examines how how flexible workspaces can lead the way in regeneration for local authorities, Why local authority intervention is key to successful urban regeneration schemes and if the Government’s challenge of embracing beauty is an opportunity for communities.

The March issue also takes a closer look at Blackburn with Darwen Council's first digital health hub to help people gain control over health and care services.

Register for your free digital issue