Charities fear cuts in wake of Kid’s Company collapse

The chief executive of a Catholic children’s society in London has warned that other charities could be in danger of losing government funding in the aftermath of the collapse of Kid’s Company.

Rosemary Keenan (pictured), chief executive of the Catholic Children’s Society (Westminster) – which does not receive government grants – said further cuts to public services were inevitable.

“Some charities are now in a position where a lot of their funding comes from commissioning and service-level agreements with local authorities and central government. If they are not services that are part of a statutory provision by local authorities or central government, they may risk closure if they do not have alternative funding streams,” she said.

Kid’s Company was forced to close last week due to a lack of funding caused by alleged financial mismanagement. The charity relied on individual donors as well as government grants and closed a week after the Government granted it a £3 million bailout.

Government contracts and grants for children’s and young people’s charities fell by 18 per cent between 2010 and 2013, according to The Observer last Sunday.

Father Hudson’s Society, a Catholic children’s society based in Birmingham, said in March that it was struggling to cover increasing operating costs on some of its projects “against a backdrop of government austerity measures and decreasing spending”.

In its annual report it warns that local authorities were not offering increases in fees in line with inflation.

“Whilst the society has made some considerable progress in reducing operating deficits, the present economic climate makes further progress difficult without impacting quality of service which the Society is keen not to do,” it states.

Ms Keenan said that the Catholic Children’s Society avoided being dependent on government funding because of inevitable cuts.

She continued: “There are difficulties for charities that accept local authority or government funding. Not least in speaking out with an independent voice or as a critical friend of the government and in the interest of the common good of their service users who are vulnerable.”