Rishi Sunak announces £750m support for charities and social enterprises

Locality and Social Enterprise UK warn the sum falls short of the £4bn hold in the sector's finances

After campaigners, warned that third sector organisations had been left out of the government’s Covid-19 rescue package, chancellor Rishi Sunak announced £750m in extra funds today.

But there are still concerns that many charities and social enterprises could still go to the wall as virus lockdown measures hit their operations.

Of the funds, £360m will be allocated by government departments to charities providing key services and supporting vulnerable people during the Covid-19 crisis.

Another £370m will go to small and medium-sized community organisations that are providing services such as delivering food, essential medicines and providing financial advice. Of this, £60m will be allocated to Scotland, Wales and Northern Ireland.

The government will also match donations made through the BBC’s Big Night In fundraiser, scheduled for 23 April, pledging a minimum of £20m.

Mr Sunak said: “It’s right we do everything we can to help the sector during this difficult time, which is why we have announced this unprecedented £750m package of extra funding,” but added: “In spite of what are unprecedented measures in scale and scope, I can’t stand here and say I can save every single job, protect every single business or indeed every single charity. That’s just simply not possible.”

In response, Peter Holbrook, chief executive of Social Enterprise UK, said: “We welcome this £750m fund as a significant measure but when compared with the size of the charity and social enterprise sectors, it will only cover at best a small minority.

“It also does not give social enterprises parity with other parts of the economy which have received large amounts of support. Social enterprises should not be penalised because of the tough environments they work in and the challenges they face in trading for purpose.”

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He added: “We remain concerned that thousands of social enterprises delivering key services in local communities, employing and working with vulnerable people and operating in the most deprived areas will go without support. Many good businesses will close unless the government takes a broader approach.”

“We will be looking through the proposals in detail, but this must be the first in a series of measures to help social enterprises, if the Chancellor is to stay true to his word to do “whatever it takes” to help people and businesses through this crisis.”

Locality, which represents community organisations, also welcomed the news but warned that it falls far short of the estimated shortfall for civil society organisations over the next three months of £4bn.

Chief executive Tony Armstrong said: “Charities, social enterprises and community organisations are a fundamental part of our social fabric, providing vital services for the most vulnerable in good times and in bad.

“The pressure on Locality’s members has been immense over the last few weeks. These local community organisations have been at the frontline of the response to COVID-19, running foodbanks, setting up schemes for isolated residents, and providing advice on issues like debt and housing. But many have been facing financial ruin as their income has stopped while demand for their services has increased.

“We are pleased that the government has recognised that at this time of national crisis, they must provide funding for those organisations who are supporting our communities through it. It’s vital that this new funding reaches community organisations quickly.”

Mr Armtrong said it is still unclear how the money will be targeted, which organisations and services will be eligible, and how quickly the money will get through.

“We will work with government to ensure that this funding is spent wisely,” he added, “but also continue to make the case that additional support is needed. Not least, we need urgent changes to the furloughing scheme to allow more charities to make use of it. Many of these organisations cannot shut up shop and wait for the crisis to be over, like some businesses can, because they are out there every day supporting their communities.

“As we move from crisis to recovery, community organisations will be at the very heart of helping our neighbourhoods rebuild from the scars left by this virus. We need to ensure they are in a strong position to do so.”

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