Guide Dogs has recorded a £7.8m loss on a cancelled customer relationship management (CRM) project, its latest accounts reveal.
Andrew Lennox, chief executive at the charity, which in March announced 181 redundancies as part of a cost-saving restructure, said ending the IT project had been a “difficult decision” and gone “against every instinct”.
Reviews of the initiative, intended to improve interactions with service users, volunteers and donors, showed it “wouldn’t deliver anticipated outcomes nor deliver the requirements needed for our future ambitions”, Lennox added.
As a result, it was put on hold in 2024 and subsequently closed permanently by Guide Dogs’ trustees.
“The alternative – continuing to spend on something that couldn't deliver for the people we serve – would’ve been far worse,” Lennox said.
The move incurred £7m in increased fundraising costs to the charity and £0.7m in extra costs of providing its guide dog service, the accounts report shows.
Expenditure up almost 10%
Overall, Guide Dogs’ expenditure rose by just under 10% to £159m for 2024, up from £145m the previous year. The increase was largely because of the CRM project write-off and a further £4m spent on staff severance costs.
At the end of December 2024, the charity’s full-time equivalent workforce was 1,642, a 9% reduction from 2023’s total of 1,807. The accounts report says it had made redundancy payments to 30 employees whose earnings had been in excess of £60,000.
Guide Dogs said the impact of April 2024’s pay award, amounting to £2.2m, had been offset through reductions in external staff and lower recruitment costs.
It recorded an annual surplus of £2.2m, down from £3.2m in 2023, after seeing a rise in annual income including investment gains, to £156m, up from £145m the year before.
Legacy income improved by more than £8.3 million compared with 2023, the report shows.
CEO: ‘Lessons have been learned’
Guide Dogs’ accounts say the charity’s organisation-wide transformation programme, which concluded in April, was “on track” to deliver £10m in annual payroll savings as well as £5m in external cost reductions.
The restructure aimed to head off a predicted £20m funding gap by 2026 and create a more flexible and efficient organisation.
Lennox said that following the cancellation of the CRM project, the charity had “learned lessons… and now have a crystal-clear understanding about [our] data, systems and organisational needs”.
“Those insights are helping shape the next phase of our digital transformation – one that has strong governance, resources and is directly aligned with our long-term strategy,” he said.
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