The government should not ring-fence funding for the voluntary sector because doing so would hinder its ability to pay off the budget deficit, according to the Chancellor George Osborne.
During a question-and-answer session at an event hosted by the learning disability charity Norwood last night, Osborne was asked whether he thought there was a case for the government to ring-fence its funding for charities.
"We've tried to protect the voluntary sector, but I don't think you can ring-fence it," he said. "You can't ring-fence everything because you'll never eliminate the deficit if you do."
Osborne said he hoped charities would be able to increase their non-statutory income. "A lot of charities have already been successful in upping their fundraising efforts," he told attendees.
At the event, a Norwood spokeswoman said that the charity now faced a 20 per cent cut in its local authority funding for next year. She said Norwood had an annual shortfall of £4m and was planning to reduce its spending by £3m per year, and raise an extra £1m per year from donations.
The charity has been considering a proposal to cut the salaries of some of its staff in order to deal with the situation.