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Investigation into government funding to charities during the COVID-19 pandemic

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Today’s report from the National Audit Office (NAO) finds that as at 19 February 2021, the Department for Digital, Culture, Media and Sport (the Department) had disbursed £454 million of £494 million it made available to support charities during the COVID-19 pandemic. It did so through seven schemes and a network of nearly 200 partners, and intends to award and disburse funding until 31 March 2021.

In April 2020, the government announced a financial support package for charities to relieve pressure on public services and help charities meet increased demand during the COVID-19 pandemic. The Department is responsible for distributing £513 million, which after deducting expected administration and evaluation costs, leaves at least £494 million available to charities.

Since April 2020, the Department has announced seven funding schemes through which charities could access funding, with the most recent scheme being announced in December 2020. Charities could access funding through a network of 198 partners including at least nine government departments; three public organisations; and 186 other partners.

The largest single scheme from which charities could compete to access funds was The Coronavirus Community Support Fund (CCSF), managed by The National Lottery Community Fund (TNLCF). The Department initially allocated £310 million to CCSF but later changed this to £199 million. It decided TNLCF was the only organisation capable of distributing the funding available in the timeframe the Department wanted. After deducting administration and evaluation costs of £11 million, £188 million was available to charities. This scheme received over 13,800 applications worth nearly £342 million. By the end of October, TNCLF had disbursed more than 95% of the £188 million it had available.

The Department initially ringfenced £160 million for government departments to distribute to charities providing key services or supporting vulnerable people within their sectors. It received 53 applications for this scheme worth £277 million. Following assessment by the Department, £164 million was allocated to support 21 projects across nine government departments.

Government stressed the need to distribute its charity funding at pace. By the end of July 2020, more than three months after the funding was announced, charities had received £103 million, 21% of the £494 million available across all schemes. This rose to £359 million (73%) by the end of October 2020 and by 19 February 2021, charities had received £454 million (92%) of available funds. As at 19 February, the Department had awarded £18 million to charities that had not yet been disbursed. The remaining £23 million had not yet been awarded or disbursed to charities, which the Department intends to do up to 31 March 2021.

Any funds remaining undistributed or unspent by government departments, other partners or charities after 31 March 2021 are expected to be returned to HM Treasury.

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