Sunday, September 25, 2016

Hit by DfID funding shift, UK charity Progressio to close

( - By Molly Anders -United Kingdom-based nonprofit organization Progressio announced today it will close its doors.

“The climate in funding is changing, it’s very competitive now, and despite our efforts to find that funding, it’s time we have to be realistic,” Martin McEnery, the head of trustees at Progressio told Devex in an exclusive interview.

“It’s very clear from discussions from DfID what they won’t be funding is unrestricted funds, and that’s what creates the difficulty for us,” he said.

The organization, which celebrated its 75-year anniversary last year, historically derives a large part of its budget from program partnership arrangements, an unrestricted funding mechanism through the U.K. Department for International Development geared toward covering overhead costs. DfID announced in 2015 it will end PPAs in December as part of its ongoing strategic review.

“We’ve done everything we could think of by way of diversifying and looking for alternative sources of funding and also exploring what DfID’s intentions were in cutting this funding,” he said.

Progressio launched a consultation period in June to seek new channels of funding. Around 35 percent of the organization’s budget comes from DfID unrestricted funding, 39 percent from international development charity VSO and the remainder from grants and multilateral funds, according to Progressio’s most recent financial filings. After funding alternatives to cover the 2 million pound ($2.6 million) budget gap did not materialize, it was decided at a stakeholder meeting on Sept. 14 that the charity — which operates in eight countries in Africa and Latin America across the environment, health and governance sectors — will shut down.

“I’m sure we’re not alone, it’s extremely competitive, especially for smaller organizations,” McEnery said.

During the charity’s anniversary celebrations, an organization spokesperson was quoted saying, “Progressio is mounting an appeal to new and existing donors to make a special financial commitment to help us become less dependent on uncertain government funding and to meet the very pressing needs of the people we work with.”

Many in the development community have expressed concern about DfID’s decision to end PPAs. Currently, 12 mostly large-scale operations, including Oxfam and VSO, have open PPAs with DfID.

Asked what advice he would give to organizations facing similar funding difficulties, McEnery said, “Make sure you’re managing your funding extremely well, it’s very difficult times for middle and small organizations working in the international field.

“Look ahead, and be realistic about the future, and as a charity, manage your reserves, don’t rely on hope,” he added.

Progressio currently employs 20 staff in the U.K. and 50 staff internationally. McEnery said the organization is negotiating with other groups to take over its ongoing programs.

“We’re all gutted. Having looked at the situation realistically, this is a decision supported by all trustees, but by no means, it’s something we’ve not done lightly,” he said.

“Seventy-five years of success is a good story, and what we want to make sure is that there’s a record of that success and also pulling together that expertise and things of value to create a legacy,” he said.

McEnery added he is especially proud of Progressio’s work on women’s rights and gender equality, the organization’s work in fragile states, and it’s governance work in countries such as Zimbabwe and Yemen.

Gabriella Jozwiak contributed reporting to this story.