Local support charity Community Matters to close

Its pensions deficit of more than £330,000 had put off potential merger partners, the charity says

The community sector support charity Community Matters is to close with the loss of three jobs.

In a statement on the Community Matters website, Alan Lloyd, the charity’s chair, said the organisation was no longer financially sustainable and its pension deficit of more than £330,000 had left it unable to find a merger partner.

The charity ceased to trade on 11 March and an extraordinary general meeting will take place on 31 March, after which Community Matters will be handed to liquidators.

Community Matters, which has existed for 70 years, has longstanding financial troubles, Lloyd said; it drew up a new three-year business plan for 2013 to 2016 after a more than 50 per cent fall in income in 2011/12.

The charity’s income in the year to the end of March 2011 was £1.8m, but fell to £859,916 a year later, according to its entry on the Charity Commission website.

Despite good performance in the first two years of the plan, the past year had seen financial difficulties resurface due to spending constraints among local authorities, said Lloyd.

Its accounts for the year to 31 March 2015 show income fell to £396,151, with expenditure of £451,545.

"Aside from income from membership, which continues to hold up strongly, the bulk of income has been earned from consultancy, training and our quality tools delivered either to direct clients or under government programmes," said Lloyd.

"Our most important client groups have been the local authorities who have much less to spend, and of course our members who also have less money than in previous years.

"The board has monitored the finances carefully throughout this financial year and has reluctantly recognised that the organisation was no longer sustainable financially and that as company directors it was our responsibility to conclude that the organisation should be wound up. This was not an easy decision and was arrived at only after careful consideration and with the benefit of professional guidance."

Community Matters has had two failed attempts at mergers in recent years, including one with local infrastructure body Navca which was called off in 2013.

Lloyd said the mergers collapsed because of Community Matters’ pension deficit of more than £330,000.

He said work on finding new host organisations for key services was underway and that an announcement on this issue could be made by the end of the month.

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