Learning Difficulties Charity In Crisis Over Cash Shortfall

A charity last night warned it was sliding deep into the red in the latest sign of financial crisis in Scotland’s voluntary sector. Cornerstone, which turns over £26million a year supporting children and adults with learning difficulties, said it could end this year with a deficit running into hundreds of thousands of pounds.

The charity has already taken action to avert what it called a potential “disaster”, signalling it will drop at least one project for more than 100 disabled people in Aberdeen.

A spokesman for Cornerstone said: “We are incurring a loss because we are unable to recover the full cost of delivery from local authorities. We have notified Aberdeen City Council that unless they resolve the funding situation for that service we will have to stop providing it. We will be reviewing our other services across the country.”

Aberdeen council has been subcontracting core services supporting 108 people with learning difficulties to Cornerstone for some time but has now set a single rate for all such work – regardless of who provides it.

Cornerstore argues that the money on offer is tens of thousands less than the cost of delivering the service, an increasingly common complaint from voluntary-sector organisations already under pressure. Cornerstone’s spokesman said: “The way someone else could provide the service cheaper is to pay staff less. But we don’t think it’s appropriate for people providing care services to be paid less than the folk stacking the shelves in Tesco. It’s a demanding and responsible role.”

Aberdeen City Council was yesterday relaxed about the prospects of providing an alternative provider for the services, probably by Easter. It is not clear what will happen to 50 Cornerstone staff currently providing a total of 4000 hours of support every month in Aberdeen.

Other charities, including Turning Point, have turned down council contracts in recent years, warning of funding gaps. OnePlus, the single-parents’ charity and childcare provider, went bust last month after considerable financial problems.

Councils, meanwhile, are desperate to get best value for their services with social work budgets increasingly tight.

Charities have lost European funding and now fear losing lottery cash too, as the 2012 London Olympics sucks more and more money out of the pot.

Gavin Yates, of the Scottish Council of Voluntary Organisations, said: “The voluntary sector has always had to endure funding difficulties but at the moment it appears we are being hit from a number of angles. From the loss of vital European funding to local authorities cutting back hard on grant giving – for many organisations it’s a hand-to-mouth existence.”

Cornerstone officially ended its last financial year with a surplus of £17,000.