The Scottish Council for Voluntary Organisations (SCVO) has launched a voluntary redundancy scheme in a bid to close a £500,000 deficit.
This week, the organisation announced through Third Force News (TFN) that it was looking to reduce its staffing costs by 8% over the next two years to tackle the deficit.
SCVO’s chief executive Anna Fowlie said offering voluntary redundancy or reduced working hours to staff was “a fair way to make savings in the least painful way”.
‘Take action to eliminate the deficit’
Every year, SCVO’s employees are told that costs exceed forecast income by approximately £500,000, but the charity has managed to close that gap in recent years, according to the TFN report.
SCVO’s board has now asked senior management to take action to eliminate the deficit in the next two financial years.
This is due to factors including core grants not keeping up with inflation or pay awards, reducing unrestricted income from services and “the low likelihood of delivering major projects on behalf of the Scottish Government in the future due to the challenging nature of public finances”.
Most of SCVO’s expenditure relates to salaries and buildings. On the latter, the charity previously sold its two Glasgow properties and decided not to renew its lease on its Mansfield Traquair Centre headquarters.
‘SCVO is no different to any other charity’
Fowlie said it was “a difficult decision to make”, adding that her organisation is no different from any other charity”.
“We’ve been hit by rising costs, including the chancellor’s ill-thought-through national insurance hike,” she told TFN.
“And our income is reducing because of standstill or reducing government grants and our service customers also struggling with rising costs. We can’t continue to live beyond our means.”
She said offering voluntary redundancy or reduced working hours to SCVO’s staff “is a fair way to make savings in the least painful way, and to keep the flexibility for us to maintain the quality offer our members and the wider voluntary sector expect”.
“I value the contribution of every one of my colleagues and don’t take this decision lightly. But it’s unsustainable to subsidise daily running costs from reserves.”
SCVO’s Unite the Union members are meeting to discuss the situation and respond accordingly.
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