Tomorrow's People creditors will get 38p for every pound, administrators say

The employment charity collapsed last year after a big loss in funding

Creditors of the defunct employment charity Tomorrow’s People will receive 38p for every pound they are owed, administrators have estimated.

The charity collapsed last year after a significant loss in funding.

The final report from the charity’s administrators, filed with Companies House last week, says the charity has closed, with the total amount claimed by creditors expected to exceed £1.5m.

The charity entered into a company voluntary arrangement, which took place after a vote among the creditors last month.

The CVA will allow the charity’s remaining funds to be distributed to creditors in a more efficient manner than going through liquidation, the administrator’s report suggests.

The report says that there are 181 claims from creditors totalling more than £1.3m, which the administrators expect to rise further to more than £1.5m.

A further 113 creditors have claims totalling almost £149,000, the report says.

The administrator therefore estimates that creditors will receive 38p on the pound, subject to final claims from landlords and former employees.

Claims from employees are estimated to be £200,000 greater than originally expected, the report says, and claims from landlords £250,000 more than previously stated.

Preferential creditors – the Redundancy Payments Service and some employees – have been paid in full already, the report says.

The charity saw its income shrink from £8.7m in 2015/16 to £4.8m in 2016/17, and attempts to bring in emergency funding and reduce overheads were unsuccessful in preventing the charity’s collapse.

The charity had 135 staff at the time of its demise.

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