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NCT and Covid 19: a case study in how the charity sector merits government support

Richard Murray, Head of Planning, Governance & Inclusion at NCT details how the current Coronavirus crisis is affecting them and their immediate financial sustainability

NCT is a charity, providing information and support to all parents at a time of change, uncertainty and vulnerability, and a social business, selling antenatal courses which fund our charitable activities, our targeted services supporting vulnerable parents and our network of 6,000 local volunteers.

Our face to face antenatal courses can longer be delivered in the current form. Last week, before the social distancing measures were introduced, bookings were 25% lower compared to the same week in 2019. Our current organisational focus is the rapid pivoting from face to face to online courses so that we can continue to support parents.

We anticipate the need to act decisively within the next three weeks and anticipate facing into tough decisions which will reduce our long term ability to support parents into the future. NCT is a medium-sized charity with a turnover of c.£15m. We have a strong balance sheet, with net assets of £4.2m.

These are allocated to:

  • £1.4m Risk response reserve (money set aside for exactly this situation)
  • £2m winding up reserve (our estimate of the cost of an orderly wind up of the charity)
  • £0.8m restricted reserves funds generated by our local volunteer branches

Our funds are currently invested in our office building (£1.2m) and our medium low-risk investment portfolio. Our core business accounting for 70% of our income is the sale of face to face antenatal courses.

Our cost base is £5m on staff; £6m on payments to self-employed antenatal teachers, with the remainder of our costs being course venues ( 70% of these are community venues, small not for profit community spaces), travel, technology and premises.

The sharp decline in new course bookings means we are facing immediate cash pressures. As a result, we are likely to need to liquidate our investment portfolio or access lending against our building in the coming weeks.

Support to date has not addressed the main challenges in front of us. We currently have 100% business rate relief and our main product is VAT exempt, so measures mooted in this area offer us little/no support. It is clear we urgently need clarity on what further support is planned and the terms attached to it to inform increasingly inevitable tough decisions about the charity’s future.


Richard Murray, Head of Planning, Governance & Inclusion, Company Secretary, NCT

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