Don’t panic: A quick guide to how charities will survive post-Brexit

Bewildered by Brexit and its impact on your charity? As a potential no-deal Brexit looms, we waded in to shed some light on the reality ahead.

Raabia Fazil | 4th Oct 19

As 31 October approaches and the spectre of a no-deal Brexit looms, remember that knowledge is power! As Brexit draws closer, clanking chains, what do charities need to know? We picked up a jack o lantern to find some clarity in the murky depths. And there is hope in the darkness, we promise!

The Charity Finance Group have recently commented on the cost-benefit analysis of Brexit for charities. CFG do not comment on the “merits or otherwise of Brexit” but aim to “highlight those areas where the government is failing to mitigate risk.”

As we do not know the government’s plans post Brexit, CFG are anxious that the government will “promise away powers or fail to negotiate a flexible arrangement with the EU, only later realising that it may need these powers to bring about the post-Brexit society that it envisions” especially as we rapidly approach the deadline.

Brexit can seem like the drawbridge being pulled up, but we found that that is not the case and charities can fortify themselves against the impact.

A no-deal Brexit would affect employment laws over time, but not immediately. Most of our employment law comes from EU policies but charity consultant Gill Taylor says “there will be no cliff-edge crisis for employment rights” on 31 October. So the axe will not fall straight away, giving your charity time to prepare for a post-Brexit world.

 > See also: Charity sector responds to Brexit vote

Spreading risk could protect your charity from financial setbacks, and will be key. Kate Rogers of Cazenove Charities recommends that charities vary their investments to protect against any losses, and Andrew Wauchope, senior investment director at Psigma Investment Management, advises shaking up investment portfolios internationally to save charities from disasters in the British economy in a no-deal Brexit.

 

Scary but manageable

There are implications to consider. But, there is a ray of light amidst the gathering clouds of doom and gloom. CAF’s Brexit and its Impact on Charitable Causes found that although charities are worried about the fallout, donations from the public remain reassuringly steady and have remained so even during earlier periods of uncertainty including the 2008 recession and 2010 coalition government.

Since the referendum, data collected between June 2018 and Dec 2018 shows that donations and volunteering stayed reassuringly steady until Dec 18.

It’s encouraging to know that you can count on support from the public for your charity. And it’s even better to know that you can get ready for changes big and small without worrying about losing such significant support.

NCVO have published No-deal Brexit and the voluntary sector: Preparing for change, providing specific considerations in case of a no-deal Brexit across a range of important factors.

Here is a quick checklist for charities:

 

Finances:

  • Review how operations, contracts and supplies would be affected by a devalued pound.
  • Develop a budget plan based on best and worst case scenarios.
  • Explore the effect of supply chains of food, medicine and other resources on your operations.

 

EU funding:

  • Confirm if your charity relies on EU funding directly or via partnerships and by how much.
  • Find out if a no-deal Brexit would impact your current or future bids for EU funding.
  • Explore avenues for UK based support to cover funding shortages after 2020.

 

Teammates from the EU:

  • Read up on the EU resettlement scheme and remember EU citizens can apply till 31st December.
  • Stay up to date on Home Office guidance and applications for staying.
  • Find out which teammates will be affected and assist them to get residency.

 

Volunteers:

  • If you work internationally, find out if you need an office in the EU or bank account in the EEA.
  • Confirm that your banking and insurance services are registered in the UK.
  • Find out if payroll and HR processes are affected by limits on data between the EU and the UK.