Since the economic downturn 2 years ago VONNE has been measuring the impact of the recession and the subsequent public sector spending cuts on the North East’s Voluntary and Community Sector, through 6-monthly surveys. At times it has made for grim reading. Running through all of the previous studies was an underlying sense that things would be difficult but the majority of organisations would survive the challenges.

With the fourth survey, ‘Surviving in a Big Society’, the evidence is clear that the optimism has been greatly eroded. Organisations are reporting serious difficulties now, with a fragile future in store. The heavy reliance on public sector funding is likely to lead to large scale closures of services, loss of skilled staff and the ultimate closure of some organisations, when the cuts bite over the next few months.

This is at a time when demand for services has never been higher. VONNE warns that the most vulnerable in communities are likely to suffer as services are lost.

Findings

Of the 141 organisations who responded:

* 62% have seen a decrease in funding
* Over a third have made staff redundant
* Nearly half are using reserves
* 69% have experienced an increase in demand for their service

The future prospects look bleak for many:

* 64% expect to, or are considering closing a service
* 50% will be, or are considering reducing the number of beneficiaries they support
* 26% may close in the next 12 months

Medium-sized organisations appear to be struggling most:

* 86% are using reserves
* 42% may close their organisation

Read the findings >>

As such the networks have been monitoring the impact of the recession on the VCS within their region.  The following is a brief snap shot of the work they have undertaken.

East of England

In the East of England, COVER (Community and Voluntary Forum Eastern Region) undertake a regional survey every year to look at the state of sector in their region.  The latest survey results show that the recession is having a twin impact on the sector with demand for VCS services rising, particularly for advice and support services, and for over 70% of respondents income is falling or flat (which equates to an actual cut as salaries and utility bills, etc increase).

Key Headlines

For 72% of organisations with flat or falling incomes, client services are being reduced or closed, staff hours are being cut, staff are being made redundant, reserves are being used up and in extreme cases organisations are closing down.

East Midlands

One East Midlands commissioned research with a small sample of VCS organisations and sought the views of a number of key partners and stakeholders concerning the economic downturn and the impact in the East Midlands.

The results were shared at One East Midlands Partnership conference in March 2009, and a subsequent report was produced on the impact of the ‘Economic Downturn on the VCS in the East Midlands Region’ and disseminated.

Key Headlines

The biggest impact being felt was greater uncertainty particularly around the potential for further funding.  There was also concern for the impact on volunteers and the recruitment and retention of staff.

London

The London Voluntary Service Council is running their ‘Big Squeeze’ campaign, which included a survey looking at the impact of the recession where over 100 organisations responded.  The results have been disseminated widely and the campaign has been key in supporting the inclusion of a line in the Mayor’s Economic Recovery Action Plan for London that the public sector should provide support to the VCS to help them assist London’s most disadvantaged communities.

Key Headlines

71% of organisations report an increased workload, while 80% were not confident they could continue to meet this demand indefinitely.  95% indicated that the recession was already affecting them and the communities they support, with fear of hard time ahead being very high.

North East

In the North East, VONNE (Voluntary Organisations’ Network North East) has undertaken two surveys of the VCS in the region to look at the impact of the recession.  The results have been disseminated widely and have led to the Regional Grand Select Committee asking the Regional Minister to write to HM Treasury calling for the continuation of ‘Real Help’ funding and support beyond March 2010.

Key Headlines

69% of respondents have experienced an increase in demand for their services, with 55% already seeing a reduction in their funding.  26% have seen a decrease in the number of paid staff and a further 27% expect to make staff redundant in the next 12 months.  10% of respondents anticipate closing in the next 12 months, while this figure jumps to a third for small organisations.

North West

Voluntary Sector North West (VSNW) under took a quick survey of more than 20 VCS debt and money advice agencies in the North West, which led to discussion with local authorities to maintain level of funding for to VCS debt advice.  VSNW are currently pulling together the data from other VCS surveys in the region to give a North West picture.  This will be followed by recession survey work with a controlled sample of VCS organisations to assess the impact post March 2010.

Key Headlines

There has been large scale increases in demand on debt advice services, which (in some areas) has led to the introduction of waiting lists of up to 6 weeks, and the number of people seeking to volunteer through volunteer centres.

South East

Regional Action and Involvement South East (RAISE) conducts a regular quarterly e-survey of members on the impact of the economic climate on their organisations.  The analysed results from the survey are fed into the South East Economic Delivery Council and disseminated to key regional statutory partners.

Key Headlines

Demand on services has increased and it is at its highest since the survey began in January 2009.  The number of respondents reporting no change in their income level has risen.  The proportion of organisations that have had to make staff redundant has fallen.  The major issue facing local communities is increased debt.

South West

South West Forum has worked with its regional partners Black South West Network (BSWN) and Regional Infrastructure for Social Enterprise (RISE) in advocating to maintain and increase investment in third sector organisations by the public sector in the South West during the recession. This has included giving evidence to the South West Regional Select Committee of MPs as part of their investigation into the Government’s performance in tackling the recession.  This has led to a representative of the Third Sector in the SW being invited to join his Regional Economic Task Group which coordinates recession work within the region.

Key Headlines

South West Forum members report an increased demand for services provided by front line organisations and ah increasingly difficult funding environment, which is likely to become worse after March 2010 and much worse after March 2011.

West Midlands

Regional Action West Midlands (RAWM) has worked with Social Enterprise West Midland and West Midlands European Network on responses to the recession. Together they have developed a Third Sector Economic Manifesto from the first ever West Midlands Third Sector Economic Summit which they are asking all voluntary groups in the West Midlands to sign-up to.

Key Headlines

Of the 14,400 organisations registered in the West Midlands up to 3,800 are at risk of failing.  Of these some 780 organisations are considered to be extremely vulnerable.

Yorkshire & Humber

Yorkshire and the Humber Regional Forum recently conducted the first of its quarterly VCS Confidence survey.  They will also be running a follow-up Health of the Sector survey later this year.  The Forum has also published a report by the Worklessness Commission among people aged 50 plus.  The Commission was supported by the Regional minister and the work has been used as the basis of work she is undertaking on the issue of worklessness.

Key Headlines

Most respondents to the survey think economic conditions within the VCS will deteriorate over the next 12 months.  Overall the sector expects to deliver more services, but does not expect staffing numbers to keep pace.  43% of organisations expect their own financial situation to deteriorate; while 15% expect it to improve.  Most organisations expect to collaborate more over the next 12 months.

Full details of the work being undertaken by each regional network can be found on their individual websites, which can be found on http://www.regionalvoices.net/the-regions/

Voluntary organisations find demand soaring as they continue to be squeezed by the recession according to the results of a new survey into the impact of the recession on the third sector in the North East.

The survey, the largest of its kind, was conducted by VONNE, the North East voluntary sector umbrella body.  It builds on the results of a previous survey carried out six months ago, which reported charities struggling to cope with demand alongside falling funding. These latest results show that the situation has worsened for charities and the vulnerable people they support.

Over two thirds of the organisations surveyed reported an increase in demand for their services as a result of the recession – often essential services for the most disadvantaged.  At the same time, the majority of organisations report a decrease in funding. A quarter have reduced staffing levels this year and 10% expect to close down within the next twelve months. Small organisations are the most at risk with 33% expecting to close in the coming year.

Jo Curry, Chief Executive of VONNE, says that it is the region’s most vulnerable and disadvantaged that will lose out.

“The outcome of our follow up survey, ‘Still Surviving?’ is predictably depressing. As the impact of the recession begins to bite for the voluntary and community sector, the picture painted gets increasingly bleak,” she said.

“So far as it is possible to predict, the situation will get considerably worse before it gets better. Already we are beginning to see savage local authority cuts announced for the third sector. Northumberland County Council and Stockton Borough Council have announced cuts of 20% for next year and we are told that the sector there is, not surprisingly, ‘reeling’. Whatever the outcome of next year’s general election, there will be further huge cuts in public sector spending and this will quickly filter down to the voluntary and community sector.

“We ask the public to imagine what they would do without their local charities, as sadly this picture is becoming increasingly real. Go out and volunteer, give generously and ask of our region’s leaders to do all they can to support the life blood of our communities in this difficult time.”

Hardest hit are charities advising on family support, rural organisations, black and ethnic minority organisations and volunteering groups.

The main findings of the survey, entitled ‘Still Surviving?’, are:

• more than half of organisations report a decrease in funding
• over two thirds of organisations have experienced an increased demand for services
• a quarter of organisations have made staff redundant and a further quarter predict doing so in the next 12 months
• over a third of organisations are already operating on their reserves
• a third of organisations expect to close an existing service in the next 12 months.

Mike Worthington, Chair of VONNE, said:

“VONNE is committed to monitoring the situation and campaigning for funding to retain essential services. This follow up survey lists a number of recommendations which we will endeavour to implement on the sector’s behalf.”

More information:  Still Surviving? >>