Charities ‘need substantial support’ as COVID-19 continues to take its toll.
Many Charities are likely to ‘need substantial support’ as the virus grips the Country, with many charities expecting to lose around a third of their income over the next three months due to the coronavirus outbreak warns Karl Wilding Chief Executive of the National Council for Voluntary Organisations.
Its estimated that Charities set to lose an average £4bn of a predicted £12.5bn income in the next financial quarter due to a loss of trading income; with a quarter of charities having reserves that could see them through the next three months, whilst social distancing rules aimed at stopping the spread of the virus had made traditional fundraising events such as marathons impossible.
HM Treasury have said Charities will be able to defer VAT bills for three months, and many charity shops will qualify for a year-long holiday on business rates.
Many Charities are likely to ‘need substantial support’ as the virus begins to takes its toll on, whilst Charities can also apply for the Job retention scheme which grants firms cash to pay 80% of the wages of staff furloughed on temporary leave but it would only be an option for up to a third of charities. However, putting staff on leave is the last thing that many charities involved in the fight against the virus would be able to do, due to increased demand. Mothballing staff when demand is increasing is the opposite of what you need to do.
As well as the support on business rates and VAT, charities which raise at least half their income from trading will be eligible to apply for government loans from a £330bn scheme.
The COVID-19 pandemic takes its grip, many charities are faced by a crisis which is now is more serious than after the 2008 financial crisis, when it got a £40m bailout, noting that Charities are likely to ‘need substantial support’. The pandemic we face today is far bigger and more involved; with many people turning to the sector for financial support and assistance.
Martin Houghton-Brown, Chief Executive of St John Ambulance, said “The Treasury would need to step up and help charities respond to the virus.”
He said the charity, which is providing volunteers for the Nightingale hospitals dealing with COVID-19 patients, needed an extra £450,000 a week to continue going throughout the crisis.
He added that despite some generous private donations, as things stand many Charities will need to borrow heavily against its assets to keep going beyond August.
Labour MP Stephen Doughty, wrote a letter, called for emergency help and backed the idea of a “stabilisation fund” for voluntary organisations.
The Treasury has said it recognises some charities are facing difficult decisions and do not want to stop services when they are most needed.
The Government wants to assure charities that our approach to regulation during the current crisis, as it aims to be flexible and pragmatic as possible in the public interest, whilst helping trustees to be aware of and think about the wider or longer impact of their decisions on their charity. Some the most commonly asked questions can be found on https://www.gov.uk/government/news/coronavirus-covid-19-guidance-for-the-charity-sector
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