Support to vulnerable people in poverty set to be hit as many NGOs likely to fold in 6 months’ time without additional support

Bond, the UK network for organisations working in international development, is concerned that efforts by NGOs to deliver vital development and humanitarian support to some of the world’s poorest people are at risk.

43% of respondents to their latest survey report that their organisations will fold within six months, removing assistance to vulnerable people around the world living in countries with weak public health and social services, unless urgent additional support is made available.

Recent reports have shown that those living in poverty are most at risk of contracting and dying from the virus. People living in poverty are also more likely to be negatively affected by social distancing measures which may restrict access to food and put livelihoods at risk.

The survey also revealed that small NGOs are most at risk of closure.

52% of small NGOs reported having to cut back on programming working across the global south due to social distancing, travel restrictions and reduced funding, and 15% said they had already made redundancies.

Stephanie Draper, CEO, Bond said:

“NGOs are doing everything in their power to absorb the impact COVID-19 is having on their organisations to avoid any adverse consequences on the vital services they provide to people living in poverty around the world.

But if over a third of organisations, particularly small specialist ones, fold over the next 6 months, more vulnerable people will be at greater risk of going without food, clean water, education and healthcare. This will leave many people dealing with COVID-19 without help, in countries without adequate healthcare systems and the financial strength to protect livelihoods. We also risk failing to contain the virus globally, which will mean it continues to be a threat, undoing any progress made towards building a healthier, more sustainable and just world.

To support NGO programmes and their response to global challenges around the world, we ask donors to explore new funding mechanisms, including a stabilisation fund, that allow NGOs both big and small to cover their core costs so they can to continue to provide essential services and ensure we do not leave the poorest behind.”

Professor Melissa Leach, Director, Institute of Development Studies said:

“UK NGOs and civil society organisations globally have an absolutely critical role to play in the response to Covid-19, and in efforts to ‘build back better’.

Government and donors worldwide, including the UK government, must act to protect NGOs. Without our longstanding and much valued civil society partners, IDS would not be able to deliver the transformational work that has helped improve the lives of the world’s poorest and most marginalised people, including through more effective pandemic responses, better and fairer tax systems and just and inclusive climate policies.”

Sarah Ingleby, CEO, Tools for Self Reliance said:

“Tools for Self Reliance, like many small international NGOs relies on a mix of income sources from funders and supporters, many of which are now under threat as a result of the current crisis. Whilst we are fortunate to have so many generous supporters, the reality is that the pandemic will hit everyone hard, and many people are facing a loss of income. Funders will inevitably see a huge demand for grants to resource UK social welfare issues, and whilst these are of critical importance, we are only as strong as our weakest link.

Despite the importance of seeing the pandemic as a truly global problem, needing global solutions, we are worried that international projects will lose out in the measures put in place to support UK charities. At present, our projects in Africa are on hold while delivery partners respond to local isolation measures, and while we have funding to continue some of these when it is safe to do so, loss of funding will put many of them under threat of permanent closure. We’re also mindful that there is a strong possibility we will need to adapt our project model in response to post pandemic needs and feel that we and our partners are ideally placed to be agile in responding to the current situation and shaping interventions driven and shaped by the needs of the communities our partners work with, but with reduced income we will be limited in how effectively we will be able to do this.

This is a big concern, because the pandemic is only going to exacerbate the significant challenges faced by people already living in poverty and facing daily hardship. We work in partnership with local organisations, many of whom derive their funding from various funded projects, and there is a risk too that loss of projects will result in the closure of vital grassroots organisations.”

Other survey findings include:

Staff costs: 10% of respondents reported that their organisation have made redundancies. 54% said their organisations have furloughed staff. 28% have asked staff to take temporary pay reductions.
Size matters: Of the 50 organisations who will fold within 6 months without additional funding, 25 are small organisations, 17 are medium organisations and 8 are large organisations.
Redundancies: Of the 12 charities who are already making redundancies, 7 are small organisations, 5 are medium organisations and none are large organisations.
Long term effects: Most respondents believed the effects of the current crisis would continue beyond this financial year. Only 28% of respondents reported that assuming they remain in place for 3 months, the effects of social distancing measures on organisational finances will be limited to this financial year (2020/21). 70% said that they will affect their organisational finances this financial year and beyond or will start to affect them in the following financial year (2021/22).

ENDS

Notes to editor

This survey is the second wave of pulse surveys conducted by Bond of its members to find out how COVID-19 is affecting their work. The first wave can be found here: https://www.bond.org.uk/news/2020/04/how-is-covid-19-affecting-ngos-finances-and-operations
Bond is the UK network for organisations working in international development. Bond unites and supports a diverse network of over 400 civil society organisations from across the UK, and allies to help eradicate global poverty, inequality and injustice.
For further information please contact Maryam Mohsin on 07555 336029 or [email protected]