Two in five community organisations expect to lose a quarter of their income

Slightly more than 40 per cent of community organisations are expecting to have lost at least one-quarter of their income in the second half of this year, according to new research.

A new report, called The Power of our Network and published by community membership body Locality, highlights how locally rooted organisations have remained agile and resilient thanks to their networks and leadership despite financial losses.

The report is based on a sample of 200 Locality members, carried out between July and September. It found that  41 per cent said they expected to lose at least one-quarter of their income by January.

For organisations where trading was more than half of their income, 59 per cent expected their losses to be at least 25 per cent. 

Alongside the financial pressures, 44 per cent of community organisations said demand for their services increased by more than one-third during the first three months of the Covid-19 crisis. 

A fifth of respondents said they expected to reduce their team over the same period, but the vast majority (66 per cent) did not expect to make redundancies between July and January 2021.

The report says local restrictions and social distancing measures will continue to affect income generation, while increasing pressures on local authority finances will hit the number of grants and contracts available.

Locality is now calling on the government to use new funding opportunities, such as the £4bn Levelling Up Fund announced at the end of last month, to invest in social infrastructure and put communities in charge of how investment can best support local renewal and recovery. 

Tony Armstrong, chief executive of Locality, said the social and economic impact of lockdowns had hit communities hard. 

“Community organisations will be doing all they can to help their neighbourhoods weather these storms – but they themselves are straining under increased demand, decreased income and ongoing uncertainty,” he said. 

“We’re calling on the government to invest in local places and the social infrastructure that sustains them. 

“If we trust local places and the organisations that serve them, we can have a genuinely people-powered recovery which benefits every area.”

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