MPs urge ministers to set up a job-retention scheme for charities

A report from the DCMS committee today also suggests the creation of a new stabilisation fund to 'prevent charities from folding'

Queen's Crescent Community Association in north-west London (Photograph: Guy Smallman/Getty Images)
Queen's Crescent Community Association in north-west London (Photograph: Guy Smallman/Getty Images)

The government should urgently introduce a new Coronavirus Job Retention Scheme that would enable furloughed charity workers to volunteer for their own organisations, a committee of MPs has recommended.

A report today from the Digital, Culture, Media & Sport Committee also says the government should urgently increase the amount of support available to the voluntary sector through a new stabilisation fund “to prevent charities from folding”, adding that a lack of transparency about how the emergency funds are being allocated could mean “deserving charities will lose out”.

The report, which examines the impact of the coronavirus outbreak on charities, says the government should review the measures it has put in place to support business to ensure they fully meet the needs of the charity and voluntary sector.

The report says the government should introduce a separate Coronavirus Job Retention Scheme for charities within four weeks.

“The scheme should enable furloughed employees of charities to volunteer for their own organisations, providing appropriate safeguards are met,” it says.

The existing Coronavirus Job Retention Scheme, which many charities have been using, enables employers to furlough staff who would otherwise be made redundant and pay them 80 per cent of their wages, up to £2,500 a month.

But charities have been calling for the voluntary sector to be given an exemption to conditions of the scheme that allow furloughed employees to carry out voluntary work, but not for their own organisations.

Many charities have had to furlough staff because of a large anticipated fall in income while demand for their services is soaring.

Baroness Barran, the Minister for Civil Society, told a session of the House of Lords last week that the measures preventing furloughed staff from volunteering for their employer had been put in place to protect employees.

The report also says the committee is concerned that the government’s £750m emergency support package for the sector is insufficient and a lack of transparency about how the funds are being allocated means “deserving charities will lose out”.

It says the government’s support has so far prioritised the charities that are directly working on the front line against the outbreak and supporting vulnerable groups to cope with the crisis.

But many other charities that are not in these categories require support, the report says: “We therefore call on the government to increase the support available to charities through a comprehensive stabilisation fund, and to ensure that support is made available to charities that are not directly working on tackling Covid-19 but facing financial hardship.

“The government must also adapt existing support schemes for businesses to ensure they provide appropriate support for the charity sector. It must take these steps urgently, within a month, to prevent charities from folding.”

The report adds that the committee is concerned by the response from Oliver Dowden, the culture secretary, that the government cannot save every charity during the pandemic, given the scale of losses the sector is facing.

“Many charities and voluntary organisations perform essential work that, while not directly tackling Covid-19, underpins the fabric of our society,” the report says. “Losing their services in either the short term or after the country emerges from this crisis will cause untold damage to individuals and communities. It cannot be allowed to happen.”

The report says that with the government’s announcement of a £750m support package for the voluntary sector – Dowden told the committee that, when combined with other measures of support, the package “does the job” – ministers should not assume that the problems facing the sector have been solved or the “crisis facing charities will not grow as reserves are depleted”.

It says the Department for Digital, Culture, Media & Sport must demonstrate it is making an ongoing case to the Treasury for the charity sector to get the support it needs.

A DCMS spokeswoman said the department was “working flat out to ensure help and support is directed as quickly as possible to the sector”.

She said: “We are providing at pace an unprecedented package of government support so that charities can help vulnerable people who need it most.

"On top of the £750m of government funding, which includes £200m to hospices and £76m to charities that support vulnerable children and those who have suffered domestic abuse, sexual abuse and modern slavery, charities can benefit from the Coronavirus Job Retention Scheme and the Coronavirus Business Interruption Loan Scheme.”

Further announcements on the allocation of funding from the £750m support package are expected shortly.

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