Voluntary organisations have welcomed Jeremy Hunt’s recognition of the sector and money for charities in his spring budget but many have warned of continued hardships faced by their beneficiaries.
The chancellor unveiled a raft of new announcements in his spring budget, including more than £100m for charities and an extension to household energy support.
Helen Stephenson, chief executive of the Charity Commission, welcomed the £100m and said it “will help charities continue to support vulnerable people during a period of significant financial challenge”.
Hunt also said there will be an additional fund of £63m for leisure facilities and £10m for suicide prevention.
Julie Bentley, chief executive of Samaritans, welcomed the funding but said suicide rates haven’t changed in 20 years and “what we desperately need to save more lives is to build on this announcement with an ambitious and well-funded national suicide prevention strategy”.
The Office for Budget Responsibility reported that inflation in the UK would fall from 10.7% in the final quarter of last year to 2.9% by the end of 2023.
Based on analysis of these figures, Pro Bono Economics (PBE) projected that the charity sector will experience a real-terms income drop of £800m between 2022-23 and 2023-24.
NCVO: ‘Today we have been heard’
Sarah Vibert, chief executive of NCVO, said: “As a sector, we have been campaigning relentlessly to highlight the impact on people and communities where charities and volunteers are struggling to meet rising need. Today we have been heard. This demonstrates the power of the voluntary sector’s collective voice.
“We are delighted the chancellor recognises the vital role charities play in supporting communities and is committing crucial funding for charities. It will help ensure people and communities most impacted by the cost-of-living crisis get the support they need from voluntary organisations.”
Vibert also emphasised that it is essential “we work to find long term solutions to the current crisis”.
CFG: ‘Sadly for some, today’s announcement comes too late’
Caron Bradshaw, chief executive of the Charity Finance Group, said: “Today the government not only acknowledged the crucial work of the charity and voluntary sector, it backed it up with much-needed cash.”
She added “the cost of living continues to bite hard.” and noted that an increase in demand and struggle for resources means “sadly for some, today’s announcement comes too late”.
Bradshaw said: “We have yet to see the detail of how the newly announced funds will be distributed, but we look forward to working with the government to ensure they go where they are needed most, as quickly as possible.
“The investment in the UK charity sector is a wise one but we remain concerned that charities outside the UK will lose out on tax relief. We will be working with HMRC to understand these changes and the effect they will have on the sector’s impact here in the UK and overseas.”
She added: “Very little has been announced today that will fix the gross underfunding and under-resourcing of public services and local government. And this underfunding has a direct impact on our sector as we step in to provide services and support for people and communities that the government cannot.
“Despite the welcome elements, this budget fails to acknowledge that work simply isn’t paying for millions of people.”
NPC: ‘A campaigning success for the sector’
Theo Clay, policy manager at NPC, said: “A brightening economic outlook has given the chancellor leeway to listen to some of civil society's requests.
“The £100m for charities is welcome, and a campaigning success for the sector, but we’ll wait to see the detail on how this will be distributed to understand if this is enough for thousands of organisations facing rising demand and reduced income.”
He added that extending the fuel price guarantee until June and ending the penalty those on fixed prepayment meters face will likely do more by supporting vulnerable people.
Clay said: “Those, like us, who have campaigned for greater involvement of charities in Levelling Up may see a glimmer of light in the form of the 20 new Levelling Up Partnerships.
“Charities will also be interested in the extension of free childcare and wider efforts to get people back into work – but with the government still failing to pull all levers at its disposal, like directing the UK Shared Prosperity Fund to programmes to get people back into work, reforming social care and our health system, the question remains from today, will it be enough?”.
Pro Bono Economics: ‘Cause for reduced pessimism’
PBE’s new £800m income drop estimate compares to its previous forecast of a £2.2bn real terms drop in charity sector funds after Hunt’s autumn statement in November.
Matt Whittaker, chief executive of PBE, said: “The chancellor was keen to emphasise optimism in his budget speech, but it would be more accurate to say that the OBR has delivered cause for reduced pessimism.”
He added that while demand swells, charities inevitably have to cope with falling income as people have less to give and government funds are stretched.
“At the heart of the plan for tackling anaemic growth laid out by the government today were new approaches for increasing the supply of labour. Charities and community organisations play a unique role in the ecosystem of support available to those outside of the workforce.
“There is a clear imperative for policymakers to explore the evidenced solutions to this challenge provided by the voluntary sector, which is also a major employer of older workers, women and people with disabilities,” Whittaker said.
Locality: ‘We are grateful for the commitment’
Locality chief executive, Tony Armstrong, said: “We are delighted by the chancellor’s announcement of £100m of support for community organisations and charities. The community sector’s call for targeted support to deal with the cost-of-living crisis has been listened to in Westminster and we are grateful for the commitment of the Civil Society Minister in making this happen.
“This support will help alleviate the growing pressure on many frontline community organisations – the very organisations who are providing food banks, warm hubs, mental health and welfare support to those worst hit by the cost-of-living crisis. Many of these organisations have been struggling to survive, creaking under the weight of growing demand and soaring bills.
“We look forward to working with the government to ensure this vital funding reaches the people and places who need it most. It is crucial that arrangements are put in place as quickly as possible with a straightforward and simple process for organisations to access support.”
CTG: 'Wider support is urgently needed'
Richard Bray, Charity Tax Group chair, said: “Charities throughout the UK are facing a perfect storm of diminishing donations, increasing operating costs and – as the Chancellor recognised – rising demand for their services. Wider support is urgently needed to sustain charities in this challenging environment.
“It is disappointing that more direct support was not included in the Budget. This was a lost opportunity. CTG believes that the tax system needs positive change to support charities.”
ACEVO: ‘The voice of our sector has been heard’
Incredibly welcome to hear the Chancellor acknowledge the "brilliant work of charities" and recognise the unique role our sector plays in supporting individuals and communities - and even more so to see his response to some of the key things that our sector has asked for.— JaneIdeCEO (she/her) (@JaneIdeCEO) March 15, 2023
Charity reaction: ‘Far too many are struggling to survive’
Ndidi Okezie, chief executive of UK Youth, said: “We are pleased to see the chancellor has listened to the campaign to postpone the 20% rise in the Energy Price Guarantee, led by Martin Lewis and backed by UK Youth as part of a coalition of 135 charities – this will make a critical difference for families who are struggling in the face of the cost-of-living crisis.
“We also strongly welcome the £100m funding announced for frontline charities to continue their vital work as they experience a perfect storm of threats, together with a shrinking workforce and reduced income.
Neil Heslop, chief executive of Charities Aid Foundation, emphasised the importance of hearing more about how this extra money will be targeted to those most in need.
Thomas Lawson, chief executive of Turn2us, said the measures require people struggling on low income “to jump through extra hoops”.
“The chancellor needs to understand, no matter what he’s promising for the future, far too many are struggling to survive now,” Lawson said.
Charmaine Griffiths, chief executive of the British Heart Foundation, said while some measures announced in the budget will help with NHS staff retention issues, they do not go nearly far enough to address the acute NHS workforce crisis.
Chief of UK advocacy at Christian Aid Sophie Powell said “this budget fails once again to deliver the finance needed”, adding: “Not only has the aid pot been stunted and raided by other government departments, but it has also lost its focus on tackling poverty and its causes.”
Rick Henderson, chief executive at Homeless Link, said he was pleased the government has recognised the key role charities play in providing vital local services across the country, but added: “The chancellor had an opportunity today to make sure people experiencing homelessness have safe support and accommodation to turn to, but he didn’t take it.”
Similarly, Alicia Walker, head of policy, research and campaigns at Centrepoint, said: “Young people probably didn't expect much help from the chancellor today but this is a budget that ignores most of them almost completely.”
She added: “We can't carry on like this, ignoring the reality many vulnerable young people face by pushing them into homelessness and talking tough. If the government still wants to level up Britain and get young people working it needs to ensure their housing and unemployment benefits are based on what works, not what grabs a cheap headline.”
Big Society Capital chief executive Stephen Muers said it was good news to see improvements to the community investment tax relief scheme, which has continued potential to get capital to underserved areas and generate positive impact in those areas. However, the scrapping of social investment tax relief “is a significant step back, and creates an unequal playing field for social enterprises and charities”.
Power to Change’s chief executive Tim Davies-Pugh said though there were several “hugely positive” announcements many of the levelling up measures “continue to bear the hallmarks of competition and fragmentation”.
Kari Gerstheimer, chief executive of Access Social Care, said the charity’s “distressing caseload” indicates that the adult social care sector is far from immune to these ongoing economic ailments.
She said: “It is unsurprising then that this spring budget does nothing to ensure more people get the social care they have a right to.”
Gerstheimer added: “To us it is clear that until the government addresses the recruitment and retention issues plaguing the social care workforce, older and disabled people will continue to go without the care they have a right to.”