Opinion: P​eople Will Find Themselves Without Vital Support Unless Funding Crisis is Addressed

Posted on
15 Sep 2022
by Ivan Cooper, Director of Public Policy

Chronic underfunding, coupled with the increasing pressure​s of inflation, is an active threat to the ability of charities and community organisations to provide essential services to those most affected by cost-of-living increases. Government must address this in the upcoming Budget if we are to avoid a crisis for Ireland’s most vulnerable people.

Vulnerable people across the country rely on community and voluntary organisations, charities, and social enterprises for many essential services. Community groups funded or part-funded by the state provide many crucial services like homecare for older people, supports for people with disabilities, and supports for people experiencing homelessness. Yet many budgets from government departments and agencies that fund these crucial services have been static since 2008 and are now very inadequate. These are existential supports, not optional ones, and without charities many of them would simply not be available in Ireland. ​

These organisations work with the state to deliver vital supports, and we cannot take their existence for granted if we want them to continue serving our communities. Yet many state-funded services run on budgets that have not increased in fourteen years – indeed, many have yet to see their funding restored to 2008 levels after cuts during the Great Recession. In the face of ever-increasing inflation, people are finding that services and supports are no longer available to them.

In a recent survey by The Wheel – the national representative group for charities, community groups, and social enterprises – half of respondents said that they didn’t have sufficient funding in place to continue existing services in 2022. For almost half of the respondents, statutory funding makes up between 75% and 100% of their total funding. Over 40% have not had this funding increased in the last three years. Costs have steadily increased during this time, and it is simply not possible to maintain the same level of service without more investment into the providers.

To make matters worse, there is now a full-blown recruitment and retention crisis in the sector. This exists across the economy, of course, in the public and private sectors as well. It’s significantly worse for charities, though, who cannot offer adequate wages or employment benefits to attract staff. For example, charities that employ qualified healthcare professionals cannot offer people the same salary scales, pension benefits, or security of employment because of their precarious funding positions. Potential employees understandably go elsewhere, and services cannot run without them. The reality is that one in every three people delivering public services in Ireland today is an employee of a charity – yet they earn far less and receive unfavourable terms compared to their public-sector counterparts.

Until we see this funding situation changed, services will not be able to keep up – and Ireland’s vulnerable people and communities will experience a diminishing quality of life. In many cases, they will lose crucial services that are essential to support their lives. Remember: these are disability services, these are services for people experiencing homelessness, these are sexual and domestic violence services, these are care services. Do we want to see a future – potentially a very near future – where these are just not available in our communities?

To address this escalating crisis, exchequer funding for health, social, community and housing/homelessness services needs to be increased by €126m in Budget 2023. This is the minimum figure required to sustain the essential services delivered by charities and community groups. Given that the current budgets for these services come to over €1.2bn per annum, given the current inflationary context, and given the sustained increase in tax receipts, we believe that Government can and should now put these service budgets on an adequate and sustainable footing.  

Government should also ensure that organisations they fund can plan to develop their supports and services by providing its funding on a multi-annual basis. Right now, many funded organisations have to reapply for funding every year, and there is no guarantee that funding will be renewed. Planning is made very difficult when an organisation doesn’t know what resources it will have next year. Three- to five-year funding should become the norm. Schemes that incentivise fundraising towards services, such as the VAT compensation scheme, which allows charities to claim a refund of a proportion of their eligible VAT costs, also urgently require review and increase.

The state benefits greatly from its partnership approach to supporting and serving vulnerable people and communities, working with charities to deliver flexible, person-centred, high-quality services. It also benefits from the supplemental cash contributed to the cost of public services by charities’ fundraising efforts, from the assets (like buildings and equipment), and from the work of the army of volunteers mobilised by charities in all aspects of their work (including fundraising, service delivery, and the work of Ireland’s 65,000 unpaid trustees). But it all depends on adequate public funding being in place – and public funding is very inadequate now.

If we do these things, we will be sure to continue to benefit from the flexible, responsive, and caring work of Irelands public-serving charities – it’s a small price to pay to maintain such a remarkable national asset.

You can use this form to email your local TDs and show your support for a budget that ensures people can continue to access essential services provided by charities and community groups.