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Insights // 17 April 2020

Is the Government's Support for the Charity Sector Enough?

Partner Nick Burrows, head of our Charities & Education team, outlines the support that the Government has announced for the charity sector as part of its response to the Corinavirus (COVID-19) pandemic.

Government announces support for the charity sector

On 8 April, the Chancellor, Rishi Sunak, announced £750 million of funding for UK charities, including £360 million for those providing key frontline services or supporting vulnerable people. He praised charities for their “crucial role in the national fight against coronavirus, supporting those who are most in need” and said that it was right that the Government “do everything we can to help the sector during this difficult time.”

While welcoming the news, many within the charity sector have pointed to the fact that that this amount is dwarfed many times over by the level of backing given to businesses and the private sector.

Chief executive of the Charities Aid Foundation (CAF), John Low, said: “We must recognise the fact that there is a long way to go” and added: “CAF has seen first-hand how charities on the front line are facing incredible demands for their services at the same time as income is squeezed.”

National Council for Voluntary Organisations (NCVO) chief executive Karl Wilding, said: “With charity shops shut and fundraising events cancelled, we estimate charities stand to lose around £4 billion in 12 weeks as a result of the crisis. We have been pushing for government support because we know how many people and communities rely on the services charities provide, many of which are now at risk.”

He continued: “This announcement is an important first step, though it will not be enough to prevent good charities around the country from closing their doors. Even many that survive will look very different in a few months’ time, with a severely reduced capacity to provide the support that people rely on.”

The Chancellor and indeed the Government have continued to reiterate that charities can benefit from some of the general measures put in place, including a VAT holiday and the Coronavirus Job Retention Scheme, but Mr Sunak conceded that many charities simply cannot close their premises and either place their employees on furlough leave or ask them to work from home: “For them, shutting up shop at this moment would be to contravene their very purpose, their entire reason to exist.”

Which charities will receive support?             

£360 million will be allocated to charities providing “vital services and helping vulnerable people” at this time, 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
  • vulnerable children charities, so they can continue delivering services on behalf of local authorities
  • Citizens Advice to increase the number of staff providing advice during this difficult time

The Government has said that a further £370 million in cash grants will be distributed to “tens of thousands of small-medium sized charities providing vital services at the heart of local communities”, part of which will be provided to charities in England through the National Lottery Community Fund.

The Chancellor also confirmed that the Government will match the total donated by the public as part of the BBC’s Big Night In charity appeal, to be aired on 23 April, with a contribution of at least £20 million to the National Emergencies Trust appeal.

Our specialist Charities & Education team is here to help and can provide advice to charities on a wide range of matters. Further information can be found on the Gov.uk website.

For further information or legal advice, please contact law@blandy.co.uk or call 0118 951 6800. 

This article is intended for the use of clients and other interested parties. The information contained in it is believed to be correct at the date of publication, but it is necessarily of a brief and general nature and should not be relied upon as a substitute for specific professional advice.

Nick Burrows

Nick Burrows

Chairman & Partner, Charity & Commercial Law

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