Reopening charity shops won't save sector says Chair of the DCMS Committee

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MPs had called upon the government to take urgent action in key areas within four weeks: review business support schemes to ensure they fully met the needs of the charity and voluntary sector; publication of clear and comprehensive guidance about criteria used to allocate government support and how to apply; establish a stabilisation fund to secure sector's long-term financial health and diversity.

Chair's comments 

DCMS Committee Chair Julian Knight MP said:

"The government is taking a head in the sand approach to the plight of charities, struggling for survival against lost income and soaring demands for their services from people hit hard by the Covid-19 crisis. Ministers fail to recognise that the charities and voluntary sector present a special case at such a critical time for the country.

Our report made a clear call on government to urgently review whether its schemes to help businesses really met the needs of charities at risk of closure. We also urged backing for a stabilisation fund which would ensure the viability of this sector to provide longer term support for those in need in the difficult times ahead. The government still doesn't seem to understand that there are charities providing vital services, which are not directly related to the Covid-19 response, that need further support.

The fact that the government has failed to engage in any meaningful way with wider issues raised by our report, including the lack of clarity about how charities can access the funds that are on offer, is deeply disappointing. Charity shops might be reopening for the first time since lockdown but their future is far from secure."

Key action the Covid-19 crisis and charities Report called for:

Immediate review of measures to support businesses to ensure they fully meet the needs of the charity and voluntary sector to prevent charities from folding

In its response, the government defended the furlough scheme however failed to address issue of charities doing important work that was not directly related to the Covid-19 response and therefore not adequately covered by the funding package despite staff being required to continue to provide services: "The scheme is not designed to help charities or other organisations cut the cost of continuing to deliver essential services".

Publication of clear and comprehensive guidance about the criteria that will be used when allocating support and how organisations can apply for it, without delay

The response signposts guidance for charities on how to apply for support however the government failed to provide an explanation or mitigation for the Committee's concerns about how long it took to publish the guidance or the lack of transparency around how to apply, cited as a critical delay for the survival of some smaller charities.

Backing for charity sector's call for stabilisation fund to secure its long-term financial health and diversity

The government referenced a further £150 m. it had unlocked for the sector however failed to address the recommendation to establish a stabilisation fund: "It is important to strike the right balance between supporting the sector's important work and ensuring its ongoing independence and sustainability."

Further information

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