Third Sector Leeds warns majority of community and voluntary organisations may not survive 2020

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Almost two-thirds of community and voluntary organisations in Leeds fear they will not survive the year as rising demand for services and the financial hit of lockdown create a perfect storm.

A survey by the Third Sector Leeds alliance in April and May found almost a quarter of respondents thought their organisation may not even remain viable beyond three months.

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With 44 per cent of those unlikely to last the summer having an annual income of less than £100,000, the research suggests grassroots organisations in the city are at particular risk. It has prompted the chairman of Third Sector Leeds to call for urgent action and further government support.

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Slung Low in Holbeck has been acting as a hub for Coronavirus Community Volunteers. Picture: Tony JohnsonSlung Low in Holbeck has been acting as a hub for Coronavirus Community Volunteers. Picture: Tony Johnson
Slung Low in Holbeck has been acting as a hub for Coronavirus Community Volunteers. Picture: Tony Johnson

Chris Hollins said: “This research has been critical in understanding the state of the sector and unfortunately, the feeling is that things are getting worse as the year goes on.

“It’s estimated that the third sector contributes £750m to the Leeds economy each year – this is over four times what it receives from public sector funds.

“The sector needs a strategy for survival from central government.”

Many of the organisations now fighting for survival have played a key role in the city-wide response to the coronavirus pandemic, with half of those surveyed having developed new services in response to the public need, including providing food deliveries.

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Around half have sustained or developed online or phone-based services in order to continue providing support during lockdown, although just under three-quarters (73 per cent) said digital access was an issue for some of their service users.

Some organisations reported that volunteer numbers have reduced by two-thirds, but others have seen a massive rise in volunteering. Another of the positives was that 85 per cent reported their funders showing flexibility during the crisis.

Noting the “unprecedented levels of cooperation” between the sector and statutory bodies in recent months, Mr Hollins said: “Whilst raising money independently through fundraising, social enterprise and grants, the third sector also provides a range of services which are directly contracted to the local authority, and there has been great flexibility in how this works.

"However, the council itself now faces threats, and the financial shortfall that Leeds City Council faces is larger than the overall investment it makes in the Third Sector each year.

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"If the city council has an uncertain future, the knock-on impact on the third sector could make the combined loss to the Leeds economy and support to those most in need very substantial indeed.”

The Yorkshire Evening Post reported earlier this month that the council is in a “perilous financial position” due to the effects of the lockdown, with big cuts to services likely unless the Government can help to address an estimated £200m funding black hole.

While many individual organisations have launched urgent fundraising appeals of their own, Leeds Community Foundation also established a resilience fund at the outbreak of the crisis.

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It will use money donated to The Leeds Fund via its Virgin Money Giving online appeal to support charities and community organisations across the city that are experiencing exceptional difficulties to the pandemic.

The enormous pressure placed on charities and other third sector organisations as key fundraising events are wiped from their calendars and many individual and corporate supporters face their own financial challenges has been on the Government’s agenda since the lockdown began.

A key consideration is, no doubt, the huge social costs that will be felt in terms of issues such as health, education, the environment and tackling social inequalities if the sector collapses.

The Civil Society Almanac 2018, published by National Council for Voluntary Organisation (NCVO), suggested the sector also accounted for almost 900,000 jobs and contributed more than £15bn towards the UK’s economy.

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A £750m funding package was announced by Chancellor Rishi Sunak in April to support the UK’s charity sector “crucial role” during the crisis, including £200m for hospices.

“It’s right we do everything we can to help the sector during this difficult time,” he said. “This will ensure our key charities can continue to deliver the services that millions... rely on.”

He said that many charities were already benefiting from other government schemes, such as the £5m Loneliness Covid-19 Grant Fund.

The Government pledged to match donations to the National Emergencies Trust, guaranteeing a minimum of £20m.

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And it said it would match fund public donations to the BBC’s Big Night In charity appeal on April 23, which went on to raise more than £35m.

A further £150m in emergency funding for charities and social enterprises was announced in May too.

But with the NCVO predicting in April that charities would lose £4bn in income in just 12 weeks as charity shops closed and events were cancelled, the Government’s support alone will not be enough for many.

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