How are councils and charities co-existing in times of austerity?

coin into fundraising tin

As readers of Giving Thought may recall from the launch of the Back Britain’s Charities campaign, one of the ‘asks’ of government – local and central – is to ensure that public bodies do not cut funding to charities disproportionately. Earlier this week an event was held in Parliament to investigate this call in more detail, with the majority of the panel and audience agreeing that charities should not be used as an easy way of making spending reductions.

In addition, CAF has released polling which demonstrates how passionately people across Britain care about the charities that they support – and that support them – and clearly expresses that they do not believe that charities should be seeing their funding cut disproportionately. By disproportionately, we mean cutting charity funding by a greater percentage than the overall cut a body is making to their budget. So for example, if Council X were making overall budget cuts of 5%, making cuts to charity funding of more than 5% would be disproportionate.

Recent research gives an indication of the importance of government funding to charities, as well as the impact that government cuts are creating. In fact, even if local authorities were making proportionate cuts to funding for charities, projections estimate that funding for the voluntary sector would be £1.7 billion lower by 2017/18 than it was in 2010/11. Given that FOIs have revealed that as many as half of councils are making disproportionate cuts, the reality is that the picture may be even gloomier.

There are, of course, broader issues, which strategist John Tizard referred to in his contribution to the debate on Monday. Namely, the Local Government Association has argued that the size of local government’s central funding funding reduction across the current spending period means that councils have significantly less money to spend on local services. An increase in demand for adult social care services as a result of factors such as an aging population means that other service areas are being forced to bear the brunt of cuts, it is argued. We’re under no illusion about the number of difficult conversations and decisions that are taking place in town halls across the country.

However, the reality is that over two thirds of the general public believe that funding to charities should not be cut disproportionately. And the Back Britain’s Charities team has been asking elected officials from across the country to put their name to such a commitment, asking them to Back Britain’s Charities and stand up against disproportionate cuts to the funding of charities. Many councillors of all political parties and none have been happy to add their name. They know firsthand of the value of charities, and are willing to stand up for the charities that local people rely on.

The Comprehensive Spending Review, due to take place on June 26th, will give a better indication of the challenges that lie ahead, as we’ll see clearer details emerge about the size of the spending reductions that central and local government will face. We’ll be watching with interest to see what the trends are, but as charities receive more of their funding from local and opposed to central government, it isn’t until councils set their budgets for the years ahead that we’ll have a better idea of the reality on the ground. Given the findings of our poll, however, it is clear that this will become an electoral issue, so it will be fascinating to see which councils follow the public mood and refuse to implement disproportionate cuts.

Steve Clapperton

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