Coronavirus: MPs push govt to rescue charities facing insolvency 'within weeks'

The Digital, Culture, Media and Sport Committee has urged chancellor Rishi Sunak to announce 'urgent information' about a rescue package for charities.

The push has been made by the committee' chair, Julian Knight MP, after Prime Minister Boris Johnson said a rescue package would be unveiled, but almost two weeks later, details have still yet to be revealed.

Knight said without an immediate rescue package, many charities will be insolvent 'within weeks' as they battle with a surge in demand and a decline in income.

Sector bodies, including the NCVO, CFG and Acevo, have previously warned the sector is at risk of losing over £4bn over the next 12 weeks as a result of the crisis.

This is primarily a result of shop closures and cancelled or postponed fundraising events.

Many charities have announced plans to furlough staff under the government's Job Retention Scheme, but sector experts have warned this will only benefit a relatively small proportion of UK charities.

“People need the support of charities now more than ever yet the future of many in this sector is in jeopardy because they’re facing losing up to £4 billion in income," Knight said.

“We’re calling on the Government to take immediate steps to support charities because failing to do so will have long-lasting consequences.

“If nothing is done, some will be insolvent within weeks and even large charities will be unable to help the vulnerable and those most in need of their services at this desperate time.”

The DCMS Committee is asking the government to announce the following:

- Emergency funding for frontline charities and voluntary organisations currently supporting the response to Covid-19;

- A stabilisation fund to enable charities, voluntary organisations and social enterprises to keep operating over the coming months;

- Confirmation that any staff furloughed by a charity under the Coronavirus Job Retention Scheme are legally permitted to volunteer their services back to the charity to provide frontline support; and

- An exemption for charities to the 50% trading limit under the Business Interruption Loan Scheme, and extending eligibility under the Small Business Grant scheme to charities claiming charitable rate relief.

Last week the committee received evidence from leaders across the sector about the impact of coronavirus on charities across the UK, which it has made publicly available.

A range of charities echoed concerns about the limitations of government schemes – which are primarily designed to accommodate businesses – with many ineligible for support.

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