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Published by Scottish Council for Voluntary Organisations

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Regulator steps in as one of UK's biggest charities fails to balance books

This news post is about 1 year old

Executives admit the organisation could go bust

One of the country’s biggest disability charities is in a financial crisis with the Charity Commission having to step in.

Leonard Cheshire has spent more than it has earned in each of the last four years.

The Charity Commission has launched a statutory inquiry after managers admitted it could go bust in the next few years if it doesn’t bring its accounts under control.

It cared for some 315,000 people on an income of £130m last year.

A restructure which took place in 2022 was designed to save the charity £18m a year as hundreds of staff were made redundant.

But at the same time the charity warned of severe government underfunding that could affect those it looks after in care homes with some facing potential eviction.

It is believed Leonard Cheshire’s board and leadership team told the commission in 2022 of financial problems and the regulator opened its inquiry after that.

Helen Earner, director of regulatory services at the Charity Commission, said: “Leonard Cheshire’s latest accounts highlight the charity’s challenging financial situation and the positive steps trustees are taking to address these. 

“The trustees came to us proactively and we are working with the charity’s new chair and the executive leadership, in the context of a statutory inquiry, to support them in this work.

“The charity has cooperated fully with us. We are satisfied that the charity has a robust turnaround plan in place and is making progress in putting it into action. 

“The Charity Commission will continue to work with the new trustee board to ensure that there are appropriate, robust governance structures in place for a charity of this size.”

Ruth Owen, chief executive of Leonard Cheshire, said: “For more than 75 years Leonard Cheshire Disability has helped hundreds of thousands of disabled people to live a better life and worked tirelessly to make their voices heard.

“In recent years, in an attempt to expand these services and help more people, Leonard Cheshire Disability has encountered some financial challenges.

“In April 2022, we alerted the Charity Commission about these difficulties and put in place a new business plan.

“We are now working with the Charity Commission to ensure that this plan succeeds and that we can keep delivering our valuable work with disabled people for decades to come.”