Salvation Army hit by debts

02 November 2006

THE SALVATION ARMY is consulting staff about cuts and redundancies to plug a £9.6-million gap in its funds.

All 6000 of its staff and officers have been told of the crisis, and discussions are under way in the Army’s London headquarters and its regional offices. The talks, which will go on over the next three weeks, also cover the possible sale of Salvation Army property.

No redundancies have yet been made, a Salvation Army spokeswoman said this week; and claims that 200 people could lose their jobs were “way too high”. “We cannot say at this stage how many or which posts may go,” she said on Tuesday. “All administrative departments have been asked to make a 30-per-cent reduction in their expenditure.” 

The Salvation Army in the UK operates mainly through two separate trusts, one for central funds and the other for social work. The social-work fund would not be affected by the expected shortfall.

The Salvation Army in the UK has 821 local church centres, 92 social-service centres, with 4545 employees and 1507 active Salvation Army officers.

Social centres include 50 residential homelessness centres, 18  centres for care of the elderly, and six substance-misuse centres.

The Salvation Army has recently completed a nationwide annual appeal for £3 million, but this money cannot be used to fund the deficit. “This is totally separate: every penny from that goes on Salvation Army social work,” the spokeswoman said.

The black hole in the Army’s finances emerged because it had over-estimated the amount it would raise in voluntary giving.

Giving had increased by 135 per cent over five years. The Army had projected a further 20-per-cent growth in income for the past year, but this had not materialised.

At the start of the crisis, the Army said that it hoped redundancies would be considered only as a last resort. But as the crisis has grown over the past two months, it seems to believe that redundancies are all but inevitable. It could also hold back some of its activities until the next financial year.

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