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Charities say they are disappointed with a budget that ‘falls short’   

27 Oct 2021 News

Today’s budget does not go far enough to support vulnerable people and the sector itself could face a £6.6bn funding gap, charities have said. 

Rishi Sunak delivered the budget and a comprehensive spending review earlier today, with plenty of focus on the government’s levelling up agenda. 

However, charities were on the whole unimpressed with a lack of detail and described the measures announced as “falling short”. 

Representative organisations warned that the sector will be under greater pressure and faces a potential £6.6bn funding gap. 

Meanwhile, health and social care charities criticised Sunak for not addressing staff shortages. 

Representative bodies, funders and think tanks 

Pro Bono Economics: We fear a £6.6bn gap in giving 

Matt Whittaker, CEO of Pro Bono Economics, said working people had got a “vital boost” the chancellor’s measures do “little to help the country’s most vulnerable”, which will drive up demand for support from charities. 

He said: “The OBR’s forecasts for household spending imply that the sector could be heading into winter with a permanent £6.6bn gap in public giving as a result of the pandemic.

“All of this makes it even more disappointing to see charities once again conspicuous by their absence in the Treasury’s documents. The sector employs nearly a million people in the UK and has provided a lifeline throughout the pandemic, yet it remains overlooked by too many of the nation’s policymakers.

“There was also very little evidence in the chancellor’s speech of investment in the ‘vibrant communities’ the government has promised to enhance. The government says that improving social infrastructure in the UK’s communities is essential to ‘levelling up’ but has failed to commit to this with funding.”

NCVO: Today’s announcements will not be enough

Sam Mercadante, policy and insight manager at NCVO, said: “We welcome new spending commitments on sport, culture, and public services and are pleased to see that the chancellor has listened to charities by acknowledging the need to bolster local government funding and make changes to Universal Credit.  

“However, today’s announcements will not be enough to support charities and communities to recover from the pandemic and build a stronger society.  

“In the forthcoming levelling up white paper, we want to see investment in social infrastructure, the creation of a Community Wealth Fund, and reform of the existing funds designed to support communities to ‘level up’.” 

Community trade union: Falls far short of what the sector needs

Adrian Axtell, national secretary of Community: "The charity sector has felt the brunt of the pandemic. Urgent support is needed to get the sector, its workers and the whole country back on its feet. Whilst the announcement today is a step in the correct direction, it still falls far short of what the sector needs.” 

He added that the inflation was a concern and called for wages to rise in line with increases in the cost of living. 

“Recent research has showed us that a fifth of third sector workers are earning below the living wage, meaning that steep cost of living increases will be felt particularly harshly by those in our sector. Missing from the budget was enough action to tackle the spiralling cost of living we know is felt by so many in our sector.”

Furthermore, he said the loss of a charities minister presented extra challenges. 

“With the third sector recently losing its dedicated minister and now being merged back in with other sectors, we need firm commitments that the government won’t lose sight of the people who provide valued services to millions of people across the country. 

“The budget today had some welcome moves, but still was not enough. We need more action, and we need it now.” 

CAF: Charities need a seat at the table

Neil Heslop, chief executive of the Charities Aid Foundation, said: “Levelling up is about empowering communities, and no group is more embedded in local communities than the charitable organisations working on the ground.” 

He added that charities should be get a “a seat at the table” to improve local decisions. 

Heslop also called for levelling up to go beyond economic measures, and said: “Whilst the focus on local infrastructure is understandable, social infrastructure is important for a successful recovery. 

“We urge the government to collaborate to give charities a greater voice, which will be key to addressing the health and social inequalities seen across the country.”

Locality: Centralising is the wrong way to maximise potential 

Tony Armstrong, chief executive of Locality, which supports community organisations, said the budget was a “big opportunity” but “when it comes to economic development, both the style and substance of the chancellor’s speech reinforced a business-as-usual approach”. 

He added: “Treasury control over the Levelling Up Fund may have enabled some good party-political lines in the Commons, but it highlighted a centralising tendency that’s the wrong way to maximise local potential. What’s more, the focus in the main on big ticket infrastructure projects fails to give enough priority to investment in the underlying social infrastructure which is required to make investment stick for the long-term.”

Charity Tax Group: Charities treated as the poor relation 

Richard Bray, chair of CTG said: “The chancellor placed great emphasis in his budget speech on the role and strength of local communities. Charities are the embodiment of this and yet they continue to be treated as the poor relation when the government is providing support.

“If the government is truly committed to levelling up it must recognise that charities are the lifeblood of their communities. They cannot continue to pay more tax without there being adverse impacts on the people and causes they support and thereby on the communities that the government says it wants to support. CTG will continue to argue that the tax system needs positive change to support the work of charities.”

Power to Change: Simply replacing services or spending lost over the past decade

Vidhya Alakeson, CEO of Power to Change, which supports community businesses, said: “Today’s Budget from the Chancellor was underpinned by a recognition of the value of our social infrastructure – the buildings, services and spaces that build stronger communities. The announcements of investment in services and local government are all very welcome, but much of this is simply replacing services or spending lost over the past decade.

“We are disappointed that there is no mention of the Community Renewal Fund, which would have provided day-to-day funding for vital community services. I’m also disappointed to see that the UK Shared Prosperity Fund will not replace EU levels of funding until the end of the Spending Review period.

“Government now needs to build on some of the announcements made at the Spending Review through the forthcoming Levelling Up White Paper and put communities in the driving seat.”

Cause-focused charities

Work Rights Centre: ‘Put in perspective, the rise in National Living Wage seems modest at best’

Dr Dora-Olivia Vicol, director of the Work Rights Centre, a charity dedicated to ending in-work poverty, said that while the charity was pleased with the investment in training, the budget doesn’t go far enough to address the cost of living crisis. 

“We must remember that transport and housing take up a whole third of the income of the poorest families, and the energy price cap that is currently protecting consumers from fluctuating prices is likely to rise substantially at the beginning of next year, from £1,207 to £1,600. Put in perspective, the rise in National Living Wage seems modest at best,” she said. 

Independent Age: Nothing to deal with understaffing 

Morgan Vine, head of policy and influencing at Independent Age, said: “Today’s ‘age of optimism’ Budget wasn’t as optimistic for those in older age.  

“We welcome the extra funding earmarked for the NHS to alleviate the record backlog of people waiting, but more detail is needed on how the government will support older people waiting for treatment so that fewer people are left languishing in pain.” 

She called for a workforce strategy to deal with understaffing in health and social care, and added: “It is unclear how the pots of money announced by the chancellor will mitigate the workforce crises in both health and social care. Neither sector will be able to build back better without a workforce strategy that addresses their dire levels of understaffing.” 

Healthcare Workers’ Foundation: Government has misunderstood what is needed 

Dr Jeeves Wijesuriya, spokesperson for Healthcare Workers’ Foundation, said: “Today’s budget announcement represents a clear misunderstanding from the UK government of what is actually needed on the ground. 

“What is truly required from the government is an immediate, sustained investment into the people – the healthcare workers; porters, nurses and doctors who protected the public from the pandemic – not just the infrastructure. Clearing the backlog and supporting the nation is critical, but without healthy, happy and engaged employees to work through this backlog and plan recruitment to meet ever increasing demand, the investment will be totally redundant.” 

Carers UK: Vital that funding makes a difference 

Helen Walker, chief executive of Carers UK, said she hoped the extra council funding would support the social care system. 

“It is vital that the additional funding makes a real difference to carers, investing in the services they still have reduced access to and ensuring that they are able to get the essential breaks they need from their caring role.

“Even with this funding, we recognise that this is a sector that will continue to be under severe strain over the coming years.” 

Mental Health Foundation: Patchwork of uncoordinated measures

Mark Rowland, chief executive of the Mental Health Foundation, described the budget as a “patchwork of uncoordinated measures”. 

He added: “As the scale of the pandemic’s mental health impacts becomes apparent, the government has been unable to articulate a vision of a mentally healthier society and create a clear, costed plan to reduce and prevent the high and increasing rates of mental health problems.  

“Mental health is just as important as physical health, yet when it comes to government spending it remains the poor relation. It beggars belief that the government has not reversed cuts to public health spending, which is so vital for preventing mental health problems.” 

Trussell Trust: Far cry from his ‘age of optimism’

Garry Lemon, director of policy and research at the Trussell Trust, said: “Today the chancellor has made a choice that is a far cry from his ‘age of optimism’, for people on the very lowest incomes.

“While we welcome the reduction in the taper rate which means some families can keep more of their earnings, this cannot make up for the £20 a week cut to Universal Credit. This is the largest cut to social security since the Second World War and is a devastating blow to millions of families across the UK already struggling to make ends meet. People are now facing impossible decisions, struggling to put food on the table or heat their homes.   

He added that most food bank users, who are between jobs or unable to work, will not benefit from the measures and said the chancellor should “urgently invest in longer-term local welfare support and create a stronger social security system for everyone who needs it this winter and beyond”. 

Samaritans: Lack of funding is short-sighted

Julie Bentley, CEO at Samaritans, said suicide is an  “an inequality issue with men who are less well-off and living in the most deprived areas up to ten times more likely to die by suicide than more well-off men from the most affluent areas”.

She said the government “has failed to prioritise suicide prevention in its spending review”.

She added: “With the estimated cost of every suicide being £1.67m, and around 6,000 lives lost to suicide every year, the absence of funding for suicide prevention in today’s spending review is extremely short-sighted. Many local areas, particularly those experiencing deprivation, where suicide rates are highest, will be without funding to support critical local suicide prevention initiatives.” 

Diabetes UK: Missed opportunity to tackle the inequalities

Bridget Turner, director policy, campaigns and improvement at Diabetes UK, said: “It was disappointing to see little evidence of funding to address the backlog of diabetes care in today’s spending review announced by the chancellor. Diabetes is serious, and our research has shown that one in three people living with the condition had no contact with their diabetes team throughout the pandemic.

“Routine check-ups are crucial for identifying and reducing the risk of serious complications from diabetes, and we have campaigned for this to be a priority for government. Today’s spending review also feels like a missed opportunity to tackle the inequalities we know exist in diabetes care. At this stage, it is simply not clear where the funding is to support the 4.9 million people living with the condition in the UK.  

“We welcome the continued commitment to fund weight management services to prevent type 2 diabetes and investment in primary care, but more detail is needed about where the workforce will come from to support people living with diabetes.”  

Barnardo's:  We are calling on the government to go even further

Barnardo's interim co-CEO Michelle Lee-Izu welcomed the £500m package for families, but called on the goverment to do more.

She said: “Evidence shows that providing families with appropriate support through our family hubs on the Isle of Wight saves the taxpayer £1m a year.  We run children’s centres and family hubs across the country, and we know they make a vital difference to parents and children struggling with challenges like poverty, mental health and domestic abuse.

“That’s why we are calling on the government to go even further and ensure there is a hub available to those who need it in every community - to help families with everything from breastfeeding to keeping teenagers safe from criminal exploitation. This is essential if we want to reduce the number of children coming into local authority care every year.”

When it comes to the extra £1.8bn to help pupils affected by Covid disruption, she called for part of the funding to be used to address mental health issues. 

“There is a real danger that the pandemic could leave a lasting legacy of anxiety and poor mental health among young people unless action is taken, so part of this funding must be used for mental health and wellbeing support, including ensuring mental health support teams exist in every school.”

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