St John Ambulance will need to start borrowing money from August if the coronavirus pandemic continues into the summer, the charity’s chief executive has told MPs.
Martin Houghton-Brown told a virtual meeting of the Digital, Culture, Media & Sport Select Committee yesterday that the charity had sufficient reserves to last until August, but would need money to keep running if the crisis continued until then.
Last week the deputy chief medical officer, Dr Jenny Harries, said that social distancing measures introduced to combat the spread of Covid-19 could be in place until September.
St John Ambulance’s most recent accounts for the year to 31 December 2018 show the charity had £13.6m in free reserves, against spending of £102m.
“I think we have money until August,” Houghton-Brown told MPs via videolink. “If the current situation was to go beyond August it would require heavy borrowing.”
He said that the charity was supporting 20 hospitals during the crisis and demand was rising for the charity’s services as a first-aid provider.
But he criticised an apparent lack of leadership from some government departments in helping the charity sector survive the financial crisis stemming from the Covid-19 lockdown.
“I haven’t seen from the Department of Digital, Culture, Media and Sport or the Treasury a clear narrative on the finances,” Houghton-Brown said. He added that in contrast there was “vibrancy” in his charity’s conversations with the Department of Health and Social Care and the NHS.
He said action had to be taken to avoid many charities going bust, especially those without large incomes or reserves to help them through the next few weeks and months.
“I know there are smaller, local charities up and down the country who are genuinely vulnerable, and if we don’t move now we will lose them in a matter of weeks,” he said.
Citing the example of childcare charities, he added: “Right now existing voluntary sector organisations across the country are at risk of going under. What will we do when we want to go back to work and our childcare infrastructure is annihilated?”
Major charity umbrella organisations have been calling on the government to take urgent action to support charities of all sizes in the face of an estimated £4.3bn loss of income over the next three months because of the pandemic.
The emergency coronavirus bill has allowed employees four weeks of unpaid leave to be compensated for by the government, but Houghton-Brown said that there was “no guidance, no clarity and no confirmation about money”.
But he added that there was an opportunity to strengthen civil society and volunteering after the pandemic was over, noting the 750,000 people who had recently signed up to volunteer for the NHS.
“This is a huge opportunity to restructure our society, putting volunteering at the heart of society even more than it has been,” Houghton-Brown said.
“We could be using this to say ‘let’s learn the lessons and reposition our sector as one that can really stand side by side with the public and with the government to deliver for all of our needs’.”
Motor Neurone Disease Association concerned about furloughing
Chris Wade, director of engagement at the Motor Neurone Disease Association, also appeared before the committee by videolink, saying the charity was concerned that furloughing staff would massively disrupt its research at a crucial time for the charity.
“If we can furlough 40 to 50 per cent of our staff we would be doing really well,” he said.
“I say that really reluctantly, because that means stopping a lot of the research we do into finding a cure.
“We are in a situation where we are incredibly close, for the first time ever, to some clinical trials which might take us towards a treatment for what is a horrific and fatal disease. It means cutting back on a lot of the support and information we would provide to people with MND.”
Wade said the charity was cancelling events and the possible cancellation of the charity’s annual conference later this year would cost the organisation £200,000.
He added that the charity needed to make crucial decisions this week to address the impact of Covid-19 on its income and work.
“We have to make decisions on furloughing staff in the next week or so,” he said. “The window is closing.”