Fifth of charities to cut jobs when furlough scheme ends

Around a fifth of charities are expecting to make redundancies after the furlough scheme ends on October 31.

Research has found that 19% of charities expect to cut jobs when the job retention scheme ends next month. A further 17% are unsure whether they will lose staff, while 64% say they have no redundancy plans after the scheme ends.

The proportion rises among medium to large charities, with 25% saying they expect to lose staff after October 31.

Just 6% of small charities have redundancy plans when the furlough scheme ends, although 20% are unsure whether jobs will be safe.

The figures have been revealed in Pro Bono Economics Covid Charity Tracker, which is published in partnership with the Institute of Fundraising and the Charity Finance Group.

Almost all those surveyed say that the pandemic had “posed a financial challenge”. Since March more than a quarter (27%) of charities have already made staff redundant and made cuts to their organisation, particularly service delivery.

Around a third (32%) had slashed service delivery, including events, training, helpline and frontline support.

In addition 15% have cut back on fundraising and around one in ten (9%) have made reductions to their finance department.

Chancellor Rishi Sunak announced this month plans for an updated jobs support package when the job retention scheme ends. This will see the government cover a proportion of workers’ pay for six months.

“While some parts of the economy are on the up after a tough first half of the year, charities have yet to see the light at the end of the tunnel,” said Pro Bono Economics chief executive Matt Whittaker.

He added that the jobs support package to replace the furlough scheme “will likely provide some relief for the sector.”

“But against a backdrop of an economic recession, and the looming tightening of lockdown, for many organisations it will do little to square the circle of rising demand for help and shrinking capacity – with very serious consequences for all of us.”

Charity Finance Group chief executive Caron Bradshaw, said the survey’s findings are “deeply troubling” for the charity sector.

Meanwhile, Chartered Institute of Fundraising chief executive Peter Lewis added: “This research further confirms the significant scaling back of charitable services and activities just when people across the UK need them most.”

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