Editorial: Postcode lottery of funding cuts

It could be years before we really know how much funding the sector is losing, writes deputy editor Andy Ricketts

Andy Ricketts
Andy Ricketts

Acevo's leaked report analysing applications to the government's Transition Fund reveals much about what could be called the sector's squeezed middle.

The chief executives body was last year given access to data on applicants to the £107m fund, set up to provide grants to charities facing significant cuts in public funding, and asked to provide analysis of any trends for circulation around government.

Organisations were eligible to apply to the fund only if they had annual incomes of between £50,000 and £10m and faced losing a large proportion of their statutory income.

One particularly worrying aspect is the report's assessment of where the cuts to the 1,725 applicant organisations were hitting the hardest. It says that in the 20 most deprived local authority areas, 450 applicant organisations were losing funding totalling £142.4m. In sharp contrast, the 22 applicant organisations from the 20 least deprived areas were losing funding totalling just £3.6m.

The figures reveal a postcode lottery in which the organisations in deprived areas, whose inhabitants are more likely to be affected by the economic situation, face far worse cuts to their funding than their colleagues on the wealthier side of town. This is very concerning.

Another issue the report raises is the huge difficulties associated with making any credible assessment of the funding cuts being made. The vast difference between the four scenarios set out in the report, in which the estimated value of statutory funding cuts to the sector in 2011/12 varies between £970m and £5.5bn, demonstrates how tough it is to get a handle on the size of the financial squeeze.

The disparate nature of the sector makes the task harder. Cuts affecting national organisations tend to be picked up by the media, but when a community group loses a £500 grant from the town council it's possible that even the local paper won't notice.

It could be some years until we are able to make any accurate assessment of the scale of these cuts, by which time it could be too late for some charities.

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