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Emergency funding to protect charities amid coronavirus ‘too little, too late’, MPs warn

Emergency funding to protect charities amid coronavirus ‘too little, too late’, MPs warn

The UK has more than 160,000 registered charities (PA)

3 min read

Thousands of charities are still at risk of closure without further government support as current funding fails to fill the gap, a damning report has warned.

The Digital, Culture, Media and Sport select committee criticised the government for pledging only a fraction of the amount needed to keep British charities afloat. 

It comes after Chancellor Rishi Sunak announced £750 million emergency fund to support charities which had lost income due to the coronavirus outbreak. 

But according to the National Council for Voluntary Organisations (NCVO), the sector is set to lose approximately £4 billion in projected income in the three months from March 2020.

MPs also claim that some charities were losing out on cash due to unclear eligibility guidelines and a lack of transparency in fund allocation.

Chair of the DCMS Committee Julian Knight MP said: “The strong message that charities gave us was not that they have some sort of right to survive but that people have a right to the services they provide.

“We warned the Chancellor that charities told us they faced a £4bn gap in money coming in, with some smaller charities facing insolvency within weeks without immediate emergency support. 

“The sum of money that’s been made available goes nowhere near replacing the income that many charities have lost. 

“We’re urging the government to set up a stabilisation fund to assist organisations to stay afloat so that we avoid increasing hardship among those who depend on charities to help them during this crisis and beyond.”

The committee also called on the government to create a separate Coronavirus Job Retention Scheme for charities, allowing their employees to still volunteer for their organisation.

Under the current scheme, furloughed employees are not able to do any voluntary work for their employer, but are able to volunteer for other organisations.

“The sum of money that’s been made available goes nowhere near replacing the income that many charities have lost." - Julian Knight

Charities that receive public funding alongside other income are also ineligible for the Coronavirus Job Retention Scheme, the report highlights.

Ministers were also urged to publish clear guidance about the criteria used to allocate financial support alongside information about how organisations can apply for help.

Responding to the report, a Government spokesperson said: "We are providing at pace an unprecedented package of government support so that charities can help vulnerable people that need it most.

"On top of the £750 million government funding which includes £200 million to hospices and £76 million to charities that support vulnerable children and those that have suffered domestic abuse, sexual abuse and modern slavery, charities can benefit from the Coronavirus Job Retention Scheme and the Coronavirus Business Interruption Loan Scheme. 

"We are working flat out to ensure help and support is directed as quickly as possible to the sector."

Further announcements on the allocation of funding from the £750 million support package would be made in the coming days, they added. 

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