St John Ambulance has embarked on a major restructuring programme to tackle “significant” financial issues as its accounts show it recorded a deficit approaching £17m last year.
The first aid charity’s annual accounts for 2023, published yesterday, show it had an income of £107.7m – down £12.2m on the previous year – and spending of £123.9m over the course of the year.
When investment losses of £400,000 are added in, the charity recorded a deficit of £16.6m over the course of the year.
The accounts show the charity’s operational free reserves, which should be between £17m and £25m, fell to just £2m in 2023.
The charity’s unrestricted core costs in 2023 averaged £10m a month, meaning it would have less than a week’s spending in reserve if something drastic were to happen.
The accounts say the charity has since sold off a block of flats for £3.2m and it said it expected “further rationalisation of our property portfolio” to bolster its reserves position.
SJA has also embarked on a restructure that incurred £1.9m in termination costs in 2023.
The restructure, which began in September and is expected to be completed by the end of next month (July), aims to save at least £6m.
The charity did not specify how many people had left because of the restructure but said 23 people had been subject to compulsory redundancy.
“We have worked hard to minimise the number of compulsory redundancies we’ve had to make through this process, by offering both a voluntary release scheme for employees, by actively seeking opportunities to re-deploy people impacted by the changes and by running a meaningful consultation process where we listened to alternative suggestions from staff, which saved roles,” a spokesperson said.
The accounts show the monthly average number of people employed by the charity, including part-time staff, went up from 1,684 in 2022 to 1,726 last year.
The charity said this was because staff numbers increased in the first half of the year before the restructuring began in the final quarter.
The spokesperson said today the charity had 1,323 employees, plus another almost 200 casual workers, indicating its workforce has shrunk by about 200 people.
Stuart Shilson, chair of St John Ambulance, wrote in his introduction to the accounts that the charity had “chosen to invest significantly to meet the needs of those we serve, as well as increased regulatory demands and stakeholder expectations through modernising our operations”.
He said that under the charity’s former chief executive, Martin Houghton-Brown, who stepped down earlier this year after six years to become secretary-general of the Duke of Edinburgh’s International Award Foundation, the investment “enabled the breadth of our service during the pandemic, enhanced clinical assurance and increased youth provision”.
Shilson said: “However, investments that outstripped our income over repeated years had depleted our reserves without yet delivering a fully sustainable underlying operating model.
“Having openly acknowledged the situation, our trustees, executives and the whole community of St John embraced the need for change at every level.”
Ben Freeman, who was appointed interim chief executive after Houghton-Brown’s departure and will be succeeded by Shona Dunn, wrote in the accounts: “The breadth and scale of the challenge we are tackling are significant.
“There is no stone unturned and a sustainable platform will not be achieved overnight.
“We have had to scale back some activity and all our staff have been impacted by a redundancy programme as we restructure our internal operations. This has involved some tough choices.
“However, a determined focus has given us a clear path to a sustainable operating model for the charity.”
He said 2024 would be “a year of change with the ambition to consolidate this in 2025 to achieve a sustainable break-even position”.