It’s been a tough time to be a finance director at a British development NGO. Charities’ budgets, like many of their staffers, have endured a bruising 12 months. A pandemic increasing need and sparking a recession, Brexit, falling public donations, and government aid cuts have created a “perfect storm” for the sector, according to Bond, the network for British international NGOs.
And like businesses — but without enjoying their level of support from the government during the COVID-19 pandemic — if charities run out of money, they will have to close. That’s why Bond’s chief operating officer, Graham MacKay, is urging NGOs to increase their financial reserves and to get thinking about a strategy if they do not have one in place.
“The sector's never going to be out of the woods. I've been in the sector long enough to live through a few difficult periods, and none of them as difficult as this,” MacKay told Devex. And like wider society, the future for the sector remains uncertain — meaning NGOs should assess their financial cushion sooner rather than later “and plan for the next difficult period in another five or six years’ time,” MacKay added.