Covid-19: £750m extra emergency support for frontline charities

Chancellor Rishi Sunak has announced a £750m package of support to ensure charities, including hospices and those supporting domestic abuse victims, can continue vital work during the coronavirus outbreak

The funding includes £360m allocated directly from government departments to charities providing key services and supporting vulnerable people during the crisis. There is £370m for smaller charities, including through a grant to the National Lottery Community Fund, aimed at supporting local organisations delivering food, essential medicines and providing financial advice.

In addition the government will match donations to the National Emergencies Trust as part of the BBC’s planned Big Night In fundraiser planned for 23 April, pledging a minimum of £20m.

Chancellor of the Exchequer Rishi Sunak said: ‘All charities are eligible for the job retention scheme, and in line with medical advice, and just like any other employer the right answer for many charities will be to furlough their employees.

‘But some charities are on the front line of fighting the coronavirus, and others provide critical services and support to vulnerable people and communities.

‘For them, shutting up shop at this moment would be to contravene their very purpose; their entire reason to exist.

‘Those charities have never been more needed than they are now; and they’ve never faced such a sudden fall in their funding.

‘It’s right we do everything we can to help the sector during this difficult time, which is why we have announced this unprecedented £750 million package of extra funding.’

The departmental funding will be allocated to charities including hospices, to help increase capacity and give stability to the sector, St Johns Ambulance to support the NHS, victims charities, including domestic abuse, to help with potential increase in demand for charities providing these services, and vulnerable children charities, so they can continue delivering services on behalf of local authorities. there will also be funding for Citizens Advice to increase the number of staff providing advice.

Chris Harris, advisory partner at MHA MacIntyre Hudson, said: ‘The announcement by the Chancellor of £750m in funding to the UK charity sector was a big step forward, but the figure only covers a portion of the expected £4bn Covid-19 impact on the sector for the next quarter.

‘Charities need to act quickly to review what they are eligible for and the options most valuable to them.

‘Given that 50% of the new funding package will go to as yet unnamed individual charities, and 50% via a fund open to applications from those on the “frontline”, similarly undefined, eligibility is currently difficult to judge.

‘There will be winners and losers across the third sector. Some obvious recipients will already be in a strong fundraising position, but individual charities and sectors not name-checked should act promptly to make a case with government for the needs of their beneficiaries.

‘The charities sector is resilient and is needed even more in times of crisis. However, there is a clear threat to many charities over the next six months because they do not have the reserves in place to withstand the shock.

'Charities should ensure their short term business planning, tax and funding options, and financial reporting and audit demands, have all been properly assessed to give themselves the best chance of weathering the storm.’

The Treasury said government departments will now identify priority recipients, with the aim for charities to receive money in the coming weeks. The application system for the National Lottery Community Fund grant pot is expected to be operational within a similar period of time.

Where charitable services are devolved the UK government has applied the Barnett formula in the normal way. The devolved administrations are expected to receive £60m through the charities pot, and further significant Barnett allocations, dependent on the final proposals funded, through the direct grant pot.

Report by Pat Sweet

Pat Sweet |Reporter, Accountancy Daily [2010-2021]

Pat Sweet was the former online reporter at Accountancy Daily and contributor to the monthly Accountancy magazine, pub...

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