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Guest Blog: Post EU Referendum - Implications for the Third Sector

Thursday, September 8, 2016

Since the outcome of the EU referendum to leave the EU, there has been varying views on what the impact of Brexit will be on the economy and future of the UK. It’s clear though that whatever the views presented there continues to remain an uncertainty as to how this will affect us all.

This lack of certainty applies to the Third Sector.  NCVO provided a briefing in July that has warned that in the short term the impact of Brexit in the short term would probably be overestimated, but the longer term impact would be likely to be underestimated.

Short term charities and charitable trusts may experience an impact on their invested income, which will affect the resources available to support services to clients.

Longer term, it remains unclear which of the EU regulations will be maintained by Government and this could have an impact on the progress of legislation and charity regulations.

According to research published by the Association of Chief Executives of Voluntary Organisations (Acevo). A survey of its members in the aftermath of the Brexit vote shows charity chief executives, representing more than 3,000 employees and 15,000 volunteers, are increasingly worried about the future.

A recent Guardian article stated that UK charities typically receive more than £200m a year in total in EU structural funds through the regional development fund and the social fund. In addition they can access EU money earmarked to help people in deprived areas take their first steps out of poverty and social exclusion and to provide extra support for young people aged under 25 living in regions where youth unemployment was higher than 25% in 2012. The West Midlands has greatly benefited from EU Funds over the years.  It remains unclear for charities across the UK, from social welfare voluntary organisations to international aid agencies, as to whether they can still apply for EU funding, even though the government has not yet started to negotiate the terms of its exit from the EU.

Given that this is unknown territory, we need to understand how the longer term lack of EU funding will impact on the economic and social development of the region and in relation to the WM Combined Authority how they will respond strategically to the reduction in EU structural and social funds to some of the most deprived areas in region.