NCVO has written to George Osborne ahead of Wednesday’s Budget, urging him to provide an additional £100m for the Transition Fund and to act on irrecoverable VAT to help the voluntary sector weather the current financial storm.

In the letter, NCVO warns Osborne that estimated public spending cuts to the voluntary sector could range between £3.2bn and £5.1bn.

It suggest that an extra £100m for the transition fund, along with a more flexible criteria, would be a low-cost way to inject some much needed capital into the sector quickly.

The letter also urges the government to address the issue of irrecoverable VAT, which means charities cannot reclaim VAT on the money they spend on supporting their activities.

NCVO also calls for statutory guidance to ensure local authorities do not make disproportionate spending cuts to the voluntary sector and clear guidance on timescales by which local authorities communicate spending decisions so charities can plan properly.

“We simply cannot see the situation arise again where organisations are in the position of not knowing if their funding for vital services for vulnerable people is to continue in a month’s time,” says Sir Stuart Etherington, chief executive of NCVO.

NCVO also adds its support to community investment tax relief (CITR) in the letter, urging the government to continue the scheme and include all community interest companies under CITR.