The impact of the Covid-19 pandemic on the charitable sector

Our report with New Philanthropy Capital finds that the Covid-19 crisis will decimate the charity sector in the UK unless the Government takes urgent action. We are calling on the Government to immediately announce a new short-term emergency funding package, offering targeted support to charities most affected by the Covid-19 pandemic.

Major fundraising windfalls experienced by some charities – mostly supporting the NHS – obscure the dire situation faced by many others, which have been forced to cut back services despite rising demand, pause or cancel lifesaving research programmes, and make sweeping redundancies among their skilled staff.

Without urgent and targeted intervention, grassroots charity organisations risk being wiped out altogether. At the same time, public giving throughout the crisis risks being used as a stopgap to fill widening deficiencies in statutory provision. The UK is proud to support one of the most developed non-profit sectors in the world and is home to some of its most generous citizens. Yet, without urgent action, much of it will fail: at an incalculable cost to our society, and its future generations.

We are also calling on the Government to:

  • Urgently review existing Covid-19 policies and how they apply to charities, including rules which prevent furloughed workers from volunteering for their employers and by considering special status for charity shops once they can safely reopen.
  • Ensure that public generosity during the pandemic – particularly towards NHS charities – is used as intended, by clarifying guidance and actively prohibiting the use of charitable funds to provide statutory services.
  • Provide longer term investment in the hardest-hit charitable sectors, to prevent an irreversible slowing of progress – particularly in the field of medical research.

Commenting on the report, Polly Mackenzie, Chief Executive of Demos, said:

“Charities are at the heart of tackling societies’ most pressing challenges. Their role in society is hugely significant in helping those in desperate need. But the impacts of this pandemic have been as varied as the sector itself. We conducted this research to identify the parts of the charitable sector that are most at risk and identify ways to help them survive and adapt. There is no one-size-fits-all solution: so we have identified practical solutions to the main stress points different kinds of charities are experiencing – from service backlogs to a collapse in face to face fundraising.

“If charities have to cut services or even close down because of the funding and delivery challenges of the pandemic, it will be the most vulnerable who suffer. Those cuts would come just as the economic impacts of Covid-19 become hardest to navigate. That is why we need a comprehensive plan for a recovery in the voluntary sector, as well as the private sector.”

Read the full report here.