assorted clothes on charity shop rail

How the voluntary sector has been affected financially by the coronavirus pandemic

Published: 20/05/20 | Categories: Author: Jess Blair

Jess Blair reports back on the first of our series of COVID-19 events which focussed on the financial impact of the crisis.

On Thursday 14 May, WCVA hosted the first in a series of online events named ‘Preparing for Different Futures’ looking at how the voluntary sector in Wales responds to the challenges and circumstances presented by the current coronavirus pandemic.

This is part of a wider effort to facilitate a conversation with the voluntary sector in order to understand how organisations are responding to both the short and long term implications of the pandemic.

The first session, chaired by Peter Davies, WCVA Trustee and Chair, looked at the financial issues affecting the sector, with over 90 people and organisations represented.

The key questions each of the events will be discussing are:

  • What has been the impact in this area so far?
  • Where could this lead to long term change – both positive and negative?
  • What are the implications for the voluntary sector in Wales?
  • What could voluntary organisations, WCVA, government, or other decision-makers do that can help steer us towards a better future?

Prior to the event a survey was sent out to participants to get an initial understanding of the main issues affecting them, which was used as a framework for the discussion.

A number of issues were raised by participants in terms of the immediate impact of the coronavirus crisis for the sector.

Immediate impact

The third sector has been largely hit with an immediate loss of income, both in terms of commercial activity they may undertake and in terms of regular fundraising activity. It is clear that the landscape for both of these kinds of activities has fundamentally changed. A good example of this is charities that rely on retail shops to boost their income. Many have been forced to close their charity shops, often furloughing staff, and losing the regular income that these would provide. Others reported that they were seeing early signs of donor fatigue and were either delaying or changing normal fundraising activity, especially in light of a further emphasis on digital income generation.

Some reported that immediate costs and overheads had already increased and look set to further increase as lockdown is reduced. For example, there are costs associated with providing staff members the technology needed to be able to work from home. For organisations with furloughed staff members, concerns were raised about the delay in reimbursement for salaries, which could in some instances lead to a shortfall financially. Many people taking part in the event raised concerns around future additional costs, such as increased cleaning of spaces and the provision of PPE.

A number of organisations reported that as a result of this they are seeking temporary support through grant applications, be that through charitable trusts or business interruption loans. Funders play a crucial role in this, and a few participants highlighted the need for flexibility from them.

The long term landscape

While many organisations are dealing with immediate challenges, it is clear that there are additional, and perhaps more serious challenges in the longer term.

One participant outlined this, saying ‘Our immediate future is ok, we can also see how we can support our communities for the rest of the year. Our concern is from April 2021 when our funding sources have dried up, reserves gone and demand increasing for those who were vulnerable beforehand.’

Additional concerns were raised about the ability of some organisations to access funding to ensure their viability for the long term, with those that are not incorporated particularly affected.

One of the sectors where long term concerns are already apparent is the childcare sector. These are often unincorporated, run by volunteers and will be affected by the nervousness of parents to allow children to return to childcare and school settings.

Calls for change

Part of the objective of holding these sessions is that we get an understanding of how different bodies can support the sector as the crisis progresses. These include ourselves, the voluntary sector as a whole and of course decision makers such as local authorities and the Welsh Government.

Participants in the session raised a range of support mechanisms to be considered, such as:

  • The inclusion of the third sector in the Counsel General’s external advisory group on post Covid recovery,
  • Changes in the criteria of the Welsh Government’s Economic Resilience Fund to increase eligibility for small businesses and unincorporated organisations,
  • A support network or broker for organisations seeking partnerships or mergers to be established.

WCVA will consider these recommendations, alongside those arising from both surveys, social media and the future planned events.

Preparing for different futures: building on the community response and volunteering

COVID-19 has impacted on everybody’s lives. The lockdown has forced us all to do things differently, and to do different things. It has opened new possibilities – good and bad.

As policy-makers start to look ahead, these events provide a space to share learning, consider implications for the future and discuss what this means for decision-making today.

Our next online event will focus on volunteering. The event takes place Thursday 21 May 2020 and more details of this can be found here.

Thank you to all of those who took part in this first session. At these unprecedented times it is vital this sector comes together, shares challenges and looks to the future.