Charities fight to stay afloat in ‘perfect storm’

The Yorkshire Post can reveal alarming new figures showing the full scale of the impact of the economic crisis on the region’s third sector.

Involve Yorkshire and Humber, which represents nearly 15,000 of the region’s charity and community groups, said a survey of their members has revealed 30 per cent are using reserves to stay afloat with a further 24 per cent warning they may soon need to.

Another 17 per cent have warned they have no savings to fall back on.

The news comes after it emerged Lottery funding for the region’s good causes has plummeted since the Government announced five years ago that it was diverting around £700m from ticket sales to fund the Olympic Games.

The Government has pledged the money will be returned – however the Department for Culture, Media and Sport has admitted this will be unlikely within the next decade as they are still waiting for the Olympics assets to be sold, despite an underspend on the Games of nearly £500m.

Judy Robinson, Chief Executive Involve of Yorkshire and Humber, said: “Having some money put by for a rainy day is important not just for individuals but for organisations too – especially when those organisations are charities providing vital services to the elderly or other vulnerable people in Yorkshire.

“We need the Government to listen to what is happening in the voluntary sector, value what we do and invest in us.”

She added that organisations using reserves to fund day-to-day services is a worrying sign that charities are struggling to cope in an environment of increasingly scarce resources.

The group is backing the campaign to have the Olympics underspend returned to the Big Lottery Fund, after a survey of members revealed 100 per cent support for it.

The impact of Lottery funding in the region has been significant – since 2002 more than £938m has been spent, including more than £6m for the Altogether Better, health project managed by NHS Yorkshire and Humber. Projects include mental health promotion and support programmes to 
help people with mild to moderate mental health problems to stay in work or return to work effectively.

The Heritage Lottery Fund also awarded a grant of £7m to transform the Piece Hall in Halifax, West Yorkshire. The Piece Hall is at the centre of the regeneration of the town, boosting jobs and tourism for Calderdale.

However a closer inspection of the figures reveals a sharp decline from 2008 onwards – the year after the Government raided Lottery coffers. From 2002 - 2007 the average amount spent each year was £118m, but from 2008 – 2011 that plummeted to £57m.

The Big Lottery Refund campaign is calling for £425m to be given back to good causes, estimating the amount could fund more than 10,000 charities.

Ms Robinson said: “Lottery funding is one of the most flexible and user-friendly funds available to charities and community organisations,” she said. “Its focus on disadvantage, tackling long term problems, involving grass roots groups and not being afraid of supporting less popular issues is good.

“Involve Yorkshire and Humber hopes that recent developments, where the Lottery is administering Government programmes, will not detract from the Lottery’s independence and capacity to support good causes and ways of working that the charity sector itself has identified.”

The Big Lottery Refund campaign is being led by the Directory of Social Change. Its head of policy Jay Kennedy said: “Overall, the Government has taken more than £1bn from lottery good causes that normally do not fund sport – for example arts, heritage and the Big Lottery Fund – to support the Olympics. The lion’s share of this – £638m – came from the Big Lottery Fund.

“The amount of money which the Government announced it was taking in 2007, £675m, was also unexpected and this caused significant disruption to the way the lottery distributors – in particular the Big Lottery Fund – planned their spending and programme development.

“We are rapidly gathering supporters and are asking them to write to the Prime Minister, Jeremy Hunt and their own MPs to demand that £425m is paid back to the Big Lottery Fund immediately after the Olympics.”

[email protected]