Belfast Telegraph

Charity Funding

Neal Taylor Neal Taylor

As the Covid-19 lockdown took hold, the news initially focussed on the measures that the government was taking to support businesses in terms of furloughing staff and the government-backed loan scheme.  The news also, quite rightly, focussed on the demands on our public services, and in particular, the challenging and vital role being played by the National Health Service and its critical workers.

However, forgotten at this time was the crucial role played in our society by the charitable sector, and the massive impact that the pandemic was having on their finances at a time when many of its services were at peak demand.  This was, to an extent, remedied by the Chancellor’s announcement of a £750m funding package for charities. This was welcomed when it was announced in April, but even the Chancellor admitted that this help could not make good the losses the sector will suffer.

It is an unfortunate consequence of the pandemic that two of the key funding streams for charities have been affected.  Firstly, many businesses have cut back on all non-core spend, with charitable donations and sponsorship often the first things cut. Secondly, charities have not been able to run large fundraising events, which are held annually and which have become core contributors to their funding budget.  When this is added to the uncertain outlook over the next few years with regard to the funding charities receive from central and local government, then it is clear that managing the finances of any charity has become extremely difficult, and has placed the responsibilities borne by Trustees into stark relief.

Charities may have reserves built up, but these are split into two categories: unrestricted reserves, which can be used to fund any expenditure of the charity, and restricted reserves, which can only be spent on specific items or initiatives and generally cannot be used to meet shortfalls in core funding.  As a result, Trustees have been faced with the choice of spending their remaining unrestricted reserves in a bid to continue delivering their services during this crisis, leaving them in a precarious financial position going forward.

So what can businesses do at this time to support charities, even if their own ability to make donations has been curtailed?  The good news is that there is an underlying enthusiasm within society and hence all workforces, to raise funds for charitable organisations.  Businesses can play their part by liaising with their staff to choose their charity partner and make sure that all the fundraising undertaken by their staff is focussed on this one charity to deliver maximum benefit.  Above all, never under estimate how generous your staff will be, how committed to helping charities in their community they are, and the number of ingenious fundraising ideas they can come up with.  All you have to do is listen!