Some “great charities” could go bust before the inflation crisis is over, the chair of the regulator has warned.
Orlando Fraser, chair of the Charity Commission, told an online event this morning that, while experts expected cost-of-living pressures to ease in the next 18 months, “tremendous damage” could be done to the sector in the meantime.
Fraser was speaking at a conference hosted by the Institute of Chartered Accountants.
In a wide-ranging speech, he also acknowledged that complaints against high-profile charities were sometimes made by people with an “axe to grind” and insisted that the commission would never be swayed by anyone trying to use the regulator to advance an external agenda.
Asked about the economic challenges facing trustees and charity finance advisors during the ongoing inflation crisis, Fraser said it was a “massive priority” for the commission to help charities where it could.
Inflation was likely to come down in the next 12 to 18 months, he added, meaning that charities could “concentrate resources” to get through these pressures.
But he warned: “Tremendous damage can be done in this short period. Great charities could go under in the minority of cases. It is all hands on deck at this moment.”
Earlier in the speech, Fraser told finance specialists that their “mettle may well be tested in the months ahead” as charities navigated lower income and rising demand.
He praised the “hard-nosed realism” he had seen from some organisations as they adapted to meet the needs of their beneficiaries.
He also promised that the regulator would always “respond proportionally to the issues that we encounter and be measured in our response”.
Fraser said: “We are often made aware of accusations against, and concerns about, charities that are in the public eye. This can mean that we come under intense pressure to respond.
“Sometimes that pressure comes from people with a particular agenda or axe to grind.
“We respond with care and calm. We neither allow third-party agendas to determine our response, nor do we dismiss information brought to us point-blank.”