Charities in crisis: Mounting pressures are pushing the third sector towards breaking point

Corseford College is the first and only further education institution exclusively for young adults (18-25) in Scotland with complex and additional support needs. Established by Capability Scotland in 2022, it has been a roaring success according to the parents whose children attend it. 

Lorraine Brown, mother of Nathan Brown, an 18-year-old who began attending Corseford in July after finishing his schooling at Riverbrae in Linwood – a school that supports children and young people with additional support needs – has been singing the praises of the college and the unique opportunity of further education for her son.  

“Among many things,” she says, “Nathan is  profoundly deaf and visually impaired. He has CHARGE syndrome, a rare genetic disorder with a wide range of possible features, including hearing, speech and sight problems, heart defects, delayed development, sensory integration problems, and related eating, drinking, sleeping and communication difficulties.”  

Brown tells Holyrood the college has given Nathan “the same amazing care and education” his school did. “When we heard about it, it sounded amazing, and since going there we are delighted with it.  

“The college frequently swaps staff around, so they aren’t spending so much time with one child, they are getting to know all of the children. And that’s important because children get attached, and because they know all of the staff, there’s no issues when one of them is off work. Each member of staff knows how each child operates. I can’t rave about it enough.”

Brown says her son does cookery, computing, science and art at the college.    

“They follow a proper curriculum, with a timetable. It’s everything you would expect a college to be,” she says.  

“We were so scared about Nathan going there because of how good his previous schooling was, but it has the same vibe, and I know all of the other mums feel the same way.” 

But Corseford College is under threat. In early 2023, Capability Scotland warned uncertainties about long-term funding were risking the institution’s future sustainability. The Scottish Government had initially only committed two years of funding for the college, as well as £346,000 for a further year. Since then, funding has been frozen, and the charity has had to allocate nearly £600,000 of its resources to maintain the service.  
Brian Logan, Capability Scotland’s chief executive, says there are over 100 further education colleges for young people with complex and additional support needs in England and Wales. He wants to be talking about the expansion of these types of institutions to the rest of Scotland, rather than worrying about whether funding will be awarded. 

“The first minister keeps talking about giving people hope and positive destinations for young people leaving school. Everyone leaving school should have the opportunity to either go into employment, training, or further education. 

“And yet here is a cohort of young people across Scotland who are being denied that opportunity, while there is a recognition within government that there is a gap there in further education. Undoubtedly, [the government’s] pressures on funding and budgets means that funding has not been allocated for this group of young people beyond our third year,” Logan says. 

“We are only just one part of the country. Operating from Renfrewshire, we can draw people from several local authority areas, but we know there is a massive demand across the rest of the country. We have 25 applications sitting waiting for the new academic year, and that is just in the Renfrewshire area.”

Logan says that when provision should be being expanded, it’s “very difficult to understand” why the government is not putting “adequate resources” into supporting the service that already exists.  

Capability Scotland and Corseford College is not an isolated case of a third-sector organisation struggling due to short-term funding cycles. The feelings are felt sector-wide and were echoed in a pre-budget report by the Scottish Parliament’s Social Justice and Social Security Committee in November. It said year-on-year funding rounds “are creating financial instability and diverting time and resources away from charities’ delivery of services”.  

The committee’s report said the Scottish Council for Voluntary Organisations (SCVO) painted a stark picture of the challenges faced by charities in Scotland and it identified a 2.1 per cent real terms decrease in Scottish Government funding from the previous year’s budget against a backdrop of increased inflation and higher demand for services.  
In response, the committee called on the government to prioritise three-year funding rounds and include provisions for inflation-based adjustments.  

The committee’s deputy convener, Bob Doris, said: “We make it clear in our report that this commitment should be recognised in the upcoming budget so that the sector’s vital work can be safeguarded. We call on the government to prioritise strengthening its approach to multi-year funding and improving its processes. 

“Whilst we acknowledge the Scottish Government’s ability to agree to multi-year funding when it does not know what funding it will receive from the UK Government for subsequent years, our committee has made practical suggestions to overcome these challenges.” 

SCVO has been forthright in its campaigning for more multi-year funding for the third sector and has put together a package of asks called ‘Fair Funding in Scotland’. Within that, there are very specific asks of the Scottish Government which focus on areas such as longer-term funding; flexible, unrestricted, core funding; inflation-based uplifts; and streamlined, accessible and proportionate funding processes which will reduce administrative burdens.   

Jason Henderson, SCVO’s policy lead for regulation, tells Holyrood: “We think most of this is doable, and we know most of it doesn’t cost more money. 

“Longer-term funding is really important but it’s not the be-all and end-all. Organisations are having to contend with budget cuts, late payments, incoherent decision making, poor communication and adequate grant management and a whole load of other issues that are perhaps to do with the funding landscape itself. All of this must be addressed too.” 

SCVO’s third sector tracker shows that the pressures on organisations, which were already high, have increased in the last few years. In 2022, it was reported that around 60 per cent of organisations were struggling financially. That figure is now closer to 80 per cent. It also reported rising costs were hurting the ability to deliver services for around 40 per cent of organisations in 2022, which has now risen to 60 per cent two years on. With the trajectory that the third sector seems to be on, Henderson paints a potentially ominous future for the sector. 

“With this kind of data and the seemingly never-ending crises that keep coming and decisions from policymakers, bear in mind you can’t put a date on it, it wouldn’t be alarmist to suggest that the breaking point for the sector isn’t too far in the future if this is the current rate that we’re going at.” 

While breaking point looms, demand for the services charities and voluntary organisations provide has seen a massive increase. A briefing by the Scottish Parliament Information Centre for the social justice committee summarised it as such: “The Covid-19 pandemic has led to a heightened demand for third sector support, while the ongoing cost-of-living crisis has caused more individuals and families to seek assistance.”

The SCVO’s third sector tracker reported a consistent rise in demand for core services over multiple survey waves. In August 2021, 56 per cent of organisations noted increased demand, which escalated to 63 per cent by April 2023, while a survey by the Health and Social Care Alliance Scotland in September 2023 revealed that 84 per cent of its member organisations had experienced heightened demand for their services due to the cost-of-living crisis. 

And yet the pressures don’t end there. The Scottish Society for Prevention of Cruelty to Animals (SSPCA), which does not receive any government funding, revealed to Holyrood the decision by chancellor Rachel Reeves to increase employers’ contributions to national insurance will increase its yearly cost by an extra £400,000 and says it will “have a massive knock-on effect on the services” it can provide. 

A spokesperson for the organisation warned: “Our services are vital in every community and provide significant value to the Scottish economy, supporting local authorities, Police Scotland, and the Scottish Government. This work represents around £25m annually, through our animal rescue, wildlife work, enforcement responsibilities, and proactive community-based initiatives in education and health, all supporting animals and people impacted by the cost-of-living crisis. As for many within the third sector, we are facing considerable financial challenges and have to look at how best we highlight the vital role we play within society, securing the sustainability of our essential services both for today and in the future.”

It’s clear organisations of all sizes and focuses are under a level of immense strain that has never been seen before. Already some have had to close their services. 

People Know How, a charity that operated in Edinburgh and East Lothian tackling a range of social issues, such as transitional work for children and digital skills learning, ceased direct service operations in October due to the “drastic changes across the fundraising landscape in Scotland”. 

Its chief executive Glenn Liddall, who has worked in the third sector for 30 years, says “it’s always been difficult to get funding” but describes the current competition for funding as “off the scale”. People Know How had a range of different funders over the last decade, including the Scottish Government, local authorities, the UK Government, Children in Need, the Robertson Trust and the UK Lottery.  

“We were doing everything you’re supposed to do, working in collaboration, reporting back to funders, those sorts of things. But we hit a point in June or July where we realised it just wasn’t working, no matter how hard we worked, no matter how many applications we put in, and no matter how creative or innovative they were, we were unsuccessful.  

“Between the summer and December, we had 26 applications in a row that were unsuccessful, which is absolutely unprecedented. In my 30 years, if you get three or four in a row that are unsuccessful you think, ‘what are we doing wrong here?’. 

“One of the reasons this happens is quite a lot of the funds closed at the same time. For example, some of the lottery’s funds are closed just now, so you can’t apply for them. That’s the same for the Roberston Trust, Children in Need, and a lot of that is from Covid where a lot of money was given out. Now these funds are doing strategic reviews, which is code for they closed. And all of those big funds basically did it at the same time, and some of them for a year at a time.  

“While that was happening, other funds changed their criteria. And because of those two factors, the whole sector has started applying for things they normally wouldn’t.” 

It’s a worrying picture painted by the various parties Holyrood has spoken to, and while the Scottish Government has committed to SCVO’s Fair Funding in Scotland suggestions by 2026, “those commitments are still slightly vague”, according to the charities body. 

And as that uncertainty persists, it impacts the Scots who need to access these vital services. As Nathan Brown waits to find out if he will be attending college after the summer, his mother says: “We have gone from everything being happy and wonderful to this massive black cloud over everyone – we are all 
panicking.”