In recent weeks and months, we have been listening to the experiences and concerns of Locality members during the cost-of-living crisis. As inflation hits a 40-year-high, we have repeatedly heard the same story across England. Community organisations are once again stepping up to support local people worst hit by the crisis.
Government needs to act immediately to prepare communities for the even tougher times ahead. We need a major energy efficiency programme this Autumn, targeted at community organisations, to fund replacing inefficient boilers, insulating community buildings, and installing LED lighting.

However, they are doing so in the face of overwhelming operating costs and escalating demand. Indeed, we have heard that the impact of the crisis on organisations’ finances is “worse than Covid”. Most of our members are in England’s most deprived neighbourhoods. As with the pandemic, it is these communities that are most at risk from the impacts of the crisis.

We have heard of the real dangers the crisis poses to food security, personal and organisational finances, and health and safety. Nik Chapman, CEO of Charles Burrell Centre in Thetford, Norfolk describes the cost-of-living crisis as “terrifying”. He reported that their service users are taking extreme measures such as turning off fridges to save money – leading to serious public health concerns. And for his organisation, operating costs are going through the roof.

The support package announced in May by the former Chancellor, Rishi Sunak, will help alleviate the pressure on individuals. However, Locality is warning that the new Prime Minister must act quickly to ensure community organisations can continue to provide essential services.

To help community organisations carry on supporting local people, Locality is calling on the government to:

Make sure the support announced gets to those who need it, by putting communities in charge of the Household Support Fund.

As part of the government’s Cost of Living Support package, the Household Support Fund has been increased by £500m and extended from October until March 2023. The Fund has so far provided flexible local funding for people, but its impact has been patchy, with some local authorities administering it more effectively than others. Where it’s worked best, councils have worked hand in hand with community organisations with their ears on the ground and strong relationships with those most in need of support. To maximise the effectiveness of this new investment, government should insist councils codesign delivery with local community organisations.

Ensure community organisations can continue to help local people by reducing the VAT they pay on energy bills to 0%.

Community organisations across the country are spearheading their local emergency response to the cost-of-living crisis, dealing with huge demand for help but also struggling to keep going given their own increasing costs. Charities currently pay 5% VAT on their energy bills. With reports of increases of over 200%, reducing VAT to zero for community organisations would provide some immediate respite.

Give community organisations a fair price for work done by ensuring multi-year contracts and grants reflect rising costs.

Research from Pro Bono Economics found that a £100,000 grant will be worth £88,100 by 2024.1 This is a huge hit in income for community organisations providing vital services and is not sustainable. Public sector service contracts and grants, as well as grants from trusts and foundations, need to reflect our current reality. Commissioners and grant managers should offer mid-contract reviews to allow for inflationary uplifts in this time of rising inflation. This needs to be reflected in future local government funding settlements, so councils have the stable and sustainable funding they need to ensure service contracts meet the cost of delivery.

Help community organisations prepare for the challenges ahead by introducing a major energy efficiency programme.

Community organisations are up against it right now – but they know worse is to come this winter. Government needs to act immediately to prepare communities for the even tougher times ahead. We need a major energy efficiency programme this Autumn, targeted at community organisations, to fund replacing inefficient boilers, insulating community buildings, and installing LED lighting.

Skip to content