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Great Ormond Street Hospital Children's Charity projects 'significant' income fall

08 Jan 2021 News

Great Ormond Street Hospital Children's Charity (GOSH) predicts its income will fall by £13m in this financial year as a result of Covid-19. 

Its annual report and accounts for the financial year to 31 March 2020, filed with Companies House last week, warn that the impact of Covid-19 is significant after fundraising events were cancelled. 

The accounts read: “Whilst this was another strong year for the charity, it is anticipated that 2020-2021 will see a significant drop in income due to the economic impact of Covid-19.” 

To mitigate the impact of falling income, GOSH Children's Charity furloughed 39 staff, suspended the annual pay review for all staff, froze recruitment and looked at new ways to fundraise, such as an emergency appeal.

Its accounts say the income fall is likely to be around 25%, however the charity said that as of this January the expected fall in income is expected to be £13m, or 16% of previously budgeted income.

Louise Parkes, chief executive, said: “This drop will not impact our support for the hospital this year because of the way we secure and commit our funding in advance, however as the current situation continues, we will face some difficult decisions over where our support is needed most. We are continuing to work hard to create new, innovative ways that the public can help GOSH Charity. It is thanks to the generous support of our amazing donors and partners that we have managed to mitigate some of the shortfall that we face.”

Income stable 

The accounts show total income for the year 2019-20 year was £88.3m, similar to £90.1m in 2018-2019. Legacy income was £23.3m, which is level with the previous year.

The total expenditure and commitments in the year, including charity capital items, was £82.2m compared to £98.6m the year prior.

Its total investment portfolio including cash at 31 March 2020 was £216.9m. This is up from 2019 at £204.0m. 

Fundraising income totalled £87.9m, higher than the prior year when it was £84.2m. Partly due to a donation from the Abu Dhabi royal family, which is the principal donor to the Zayed Centre for Research.

From 2019-2020 trading income from activities, such as retail, was £6.9m and. 

Fundraising ratio

The total costs of raising funds and operating the charity increased to £25.2m from £24.9m. Trustees have set a target for the costs of fundraising to be limited to an average of 30% of total income on a rolling five-year period. 

This means that an average 70p or more in every £1 donated over a five-year period should be available for charitable activities. This year's accounts show that the five-year ratio is 70.5% spent on charitable activity and 29.5% on raising funds. 

However, it warns that the impact of fundraising events for the 2020-2021 year being postponed and then cancelled will affect this ratio. 

“But we are committed to minimising costs as well as seeking new and alternative income sources to keep the cost:income ration as low as possible,” the charity says.

CEO pay 

A new chief executive, Louise Parkes, joined the charity on 1 May 2019. 

The top two paid staff were the chief executive and the director of finance and operations. The accounts show these salaries to be in the £140,000 - £149,999 band and the £150,000 to £159,999 band.

The gender pay gap at the latest reporting date of April 2019 was 22.29%, a decrease of 0.48% from last year’s figure. This reflects the high proportion of men who were in the top ten earners of the charity during this period.

Editor's note - 11 January 2021

This story has been updated to include additional information from GOSH Charity about projected income loss for the this year.  

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