The latest furlough extension may not provide a panacea for the third sector but it will be a welcome shot in the arm for some
The extra time announced by Chancellor Rishi Sunak to the Coronavirus Job Retention Scheme - as it is officially known - has been widely welcomed across the third sector.
It’s a move which pointedly reminds us that leaving lockdown will not be easy, even though Covid-19 vaccinations have provided a path out of the pandemic.
But for that five-month extension until September 30 to be effective, it’s time I would advise charities to use wisely to explore whether more jobs can be saved, supporting their people and those they help. That they continue to balance the challenge of managing a once unthinkable fundraising collapse while often meeting unprecedented demand is quite remarkable.
Furlough, of course, is not a cure for all of the challenges caused by coronavirus. But it does provide some relief for those ills while longer-term treatment is explored.
Further job losses across all areas of life are, unfortunately, inevitable. It has to be hoped, however, that continuing furlough beyond its planned April end has provided a window of opportunity wide enough to save more posts than might otherwise be the case, perhaps giving chance to pursue new opportunities.
As before, up to 80% of workers’ wages will be covered by the scheme in its latest phase. The UK Government has always said that it hopes this will provide an alternative to redundancy for those businesses whose incomes are hit by the pandemic - with the fundraising collapse endured in the past year making it particularly relevant for charities and social enterprises.
The difference this time is that businesses will be asked to contribute 10% then 20% in August and September.
I know some charities, predicting how the next few years may affect their operations and fundraising, have already made redundancies. But the question many will be considering is whether this extension is a lifeline to start getting more money in - or at least provide headspace to create a more detailed plan for generating funds through events and activities than a post-lockdown era will allow? Would that provide the certainty to retain more posts? These are points worth taking expert advice on.
The importance of flexible furlough should not be overlooked in financial planning and buying time either. People can be furloughed for even part of a day, with the scheme covering 80% of that time’s salary. It may strike a balance between ramping up operations over the summer and managing costs.
Flexible furlough can also be used to provide training and prepare those who have been absent for a return to work, enhancing digital skills, for example.
The latest Whitehall figures suggest that 11.2 million jobs have been supported by the retention scheme since its launch last year.
A year on from the first lockdown, we are seeing a broader picture of how the legacy of Covid-19 is shaping charities. Some have - and are - restructuring. Others are considering alliances and mergers in order to retain services.
These are a challenge for employees, as they are for employers. I would urge anyone making changes to do so compassionately and fairly. Fingers crossed that furlough’s extra time can prove a game-changer for at least some charities.
This article by Ben Doherty originally appeared in the March 2021 edition of Third Force News magazine.
