Latest Public Sector News

29.05.12

Government cuts hit charities

Charities’ frontline services are being hit hard by government cuts, new research from think tank New Philanthropy Capital (NPC) suggests.

NPC surveyed the top 750 charities in England and Wales, and found that 65% are cutting frontline services, with 73% making staff redundant and 9% at risk of closing down entirely in the next year.

A third of charities’ funding comes from government sources, which means that decreasing levels of public spending has a significant effect on charity services and capacity to bid for contracts. 90% of charities surveyed believe they face a riskier future in the commissioning environment.

However, charities are working to continue providing key services, with three quarters drafting in more volunteers and nearly half collaborating more with other charities.

Dan Corry, NPC’s chief executive, said: “This is a time of radical change for charities. Not only are they coping with some of the biggest spending cuts in British history, but the landscape is also changing fast.

“As the state pulls back we are seeing a real shift in the way public services are commissioned and delivered. Our survey suggests some charities will be able to gear up to play a bigger role, but we think others will find it tough and will go under. It’s vitally important that we understand these changes and act now to ensure that their impact on the voluntary sector and the people they help is positive, not detrimental.”

Action for Children’s director of business development, Hugh Thornbery, added: “We are faced with so many cutbacks and added pressure to achieve the same results. As budgets keep shrinking, we are seeing the needs of projects growing, and there is now a greater scrutiny on charities to deliver tangible results through these unprecedented cuts. There’s a degree of risk inherent in any contract now that most charities wouldn’t be able to take on – yet they may be the best providers.”

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