Job losses appear likely at the veterans charity Combat Stress as it attempts to deal with a projected £6m fall in annual income.
Sue Freeth, the charity’s chief executive, said in a statement that Combat Stress, which employs 271 staff, had reached a “critical turning point” because its income was expected to fall from £16m to £10m in the current financial year, which ends on 31 March.
She said 40 per cent of the charity’s income used to come from the government, but those sources of funding had been redistributed and the charity was now 90 per cent dependent on public donations.
“We cannot supply a critical service to four UK nations on £10m per annum when most of the funding is coming from the public and charitable sector funds,” she said.
“The government must step up, and we are seeking urgent talks to address the gap.”
Freeth added: “While we have adapted to meet the demand of veterans, we are now faced with scaling back our workforce and services nationwide and have begun a consultation with staff on our proposals.”
A spokeswoman for the charity, which runs residential services for veterans who need intensive support and have complex mental health problems, was unable to confirm how many staff were affected by the changes, which are expected to be implemented by the end of March.
Freeth’s statement said the falling income meant that from today the charity would have to stop taking new referrals in England and Wales for an as yet undefined period.
She said it was “extremely likely” that the charity would have to reduce the number of veterans it supported in the future.
“We fear the consequences for veterans and their families in need of mental health support,” said Freeth.
“We know that the road ahead will be challenging, but for the thousands of veterans who need Combat Stress we must continue by refocusing our service and working with government to take control of the situation.”
In March 2018, the charity said it had lost £3.2m – 20 per cent of its total income at the time – after NHS England decided to withdraw funding from the charity.
The charity said at the time that NHS England had decided to set up a national service instead.
Combat Stress did report a small rise in income last year after registering an almost 30 per cent increase in fundraised income, which was partly due to the gift of a "living legacy" – a way for wealthy people to make substantial tax-effective gifts of assets and cash during their lifetimes – consisting of a flat valued at £1.25m.
It also secured increases in the grants received from some of its strategic partners, including the Royal British Legion, which gave £1.5m to the charity, compared with £1m the year before.