Aid agencies cut staff to make up for weak pound

Falling value of the pound forces charities to draw up contingency plans

Christian Aid project
Christian Aid project

The weak pound is forcing international aid agencies to make redundancies and reductions to overseas programmes.

The pound has fallen in value by between 20 and 30 per cent over the past year, causing financial difficulties for international charities (20 January, page 11). The scale of the problem for affected organisations is now coming to light.

Judith Brodie, UK director of VSO, said a continuing cost-effectiveness plan had involved organisational restructuring and redundancies, but declined to reveal how many redundancies had been made. VSO employs 250 people across the UK and a further 550 in 34 offices overseas.

A spokeswoman for ActionAid said it had reduced funding to some of its overseas programmes by between 20 and 30 per cent. No redundancies had been made, she said, but "you do not have to be clairvoyant to predict this could happen".

Martin Birch, finance director at Christian Aid, said the charity was not making cuts to programmes but was expecting to take £2m from its reserves over the coming year to tackle the problem.

The fall in the value of the pound has cost Oxfam £7.8m in the past year, the charity said. It is axing about 40 jobs because of the downturn. A spokesman for the charity said it had factored the financial loss into a three-year zero-growth plan.

Tearfund said its cost-cutting measures included reducing spending on staff travel and encouraging partner agencies overseas to make savings on "non-essential activities".

Stephen Bubb, head of chief executives body Acevo, wrote to international development secretary Douglas Alexander calling for financial help for charities working overseas, which were excluded from the Government's £42.5m package to help charities through the recession.

"Our members reported overseas expenditure is increasing and they need extra income to sustain this," the letter said.

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