Our spending cut plans in response to coronavirus losses
- 28 July 2020
Following the impact of the coronavirus crisis, which has affected almost every aspect of our income, we’re planning to make £100m of annual savings. We expect to lose up to £200m this year as a result of the pandemic, and we’re now introducing spending plans that include a possible 1,200 redundancies as we seek to reduce our annual spend and the size of our workforce.
Director-General Hilary McGrady shared with staff and volunteers: ‘It’s with huge regret that I am telling you today about the need to cut jobs. The Trust’s strength is its people. Our charity has survived so long – through two world wars and a number of economic downturns, thanks to staff, volunteers and supporters.
‘We would not be making these savings had we not exhausted every other possibility. We need to act now to ensure we are sustainable in the future.’
Growing back stronger
Hilary McGrady pledged that we’ll ‘grow back stronger’ in the future, stepping up our efforts to help the nation get the rest, recuperation and recreation it needs. She said in future visitors will play a greater part in bringing the places we care for to life, adding: ‘Our nations’ beautiful places are not only for looking at, but for singing and dancing and reading, learning, cooking, crafting and creating in. And they belong to everyone.’
Like most organisations, we’ve been hit hard by the effects of the coronavirus. When the country went into lockdown we closed all our houses, gardens, car parks, shops, cafés and holidays, and stopped all events, quickly losing tens of millions of pounds of support.
As part of the review, we hope to save £100m – almost a fifth of our annual spend – by changing the way we operate and reducing our payroll and budgets.
Nearly 40 per cent of the proposed savings (£40m) will be non-pay spending cuts, including reducing travel and office costs; reducing marketing and print spend in favour of digital; renegotiating contracts; reducing IT spend; and introducing more efficient processes to manage key areas of the charity.
We’ve already announced we’re stopping or deferring £124m of projects, and have introduced a recruitment freeze to reduce staff costs. To help us get through the short-term impacts of the crisis we also furloughed the majority of our staff, drew on the Bank of England’s emergency coronavirus loan scheme, and we’re reviewing other rescue and stimulus packages being offered by the government.
A need to review spending and priorities
While these measures have helped reduce the financial impact, Hilary McGrady has said the short-term hit, coupled with the longer-term implications of social distancing and suppressed trading, meant there was a need for a full review of the organisation’s spending and priorities.
She said: ‘We are going through one of the biggest crises in living memory. All aspects of our home, work and school lives, our finances and communities have been affected, and like so many other organisations the National Trust has been hit very hard.
‘The places and things the National Trust cares for are needed now more than ever, as the public needs to recuperate and recover their spirit and wellbeing. Our focus will remain on the benefit we deliver to people, every day.
‘We have reviewed our spending and ways of working to ensure we emerge from this crisis in a strong position to keep on protecting and caring for places so people and nature can thrive.
‘It is deeply upsetting to face losing colleagues and we are committed to supporting all of those affected. Sadly, we have no other course of action left open. In making these changes now, I am confident we will be well-placed to face the challenges ahead, protecting the places that visitors love and ensuring our conservation work continues long into the future.’
Our 2020 ambitions will continue
The reorganisation will allow us to continue the ambition we set out in January to step up our battle against climate change: becoming carbon net zero by 2030, planting millions of trees and creating green corridors for people and nature.
We’ll also refocus our efforts to protect cultural heritage, with limits on cuts to staff caring for houses, gardens and collections, enabling us to carry out plans to tailor our care for places according to their unique characteristics, ensuring they offer visitors and supporters the first-class experience they have come to expect.
We’ve drawn up a plan to restart our strategy from March 2021. But to do this, we must be leaner and more flexible, and reduce our operating and project costs.
Hilary McGrady said: ‘The ambition I set out in January, our renewed focus on caring for nature, beauty and history, becoming carbon net zero by 2030 and improving access to nature in towns and cities, remains as strong, but with such significant financial losses we will have to be more flexible in how we achieve it.
‘We expect to work more in partnership with other charities and with local communities, and to fundraise more in the future. At a time of climate crisis, it’s essential that conservation charities make the case for donations of money and time, so the nations can face up to the challenges ahead.
‘Our purpose remains clear, to provide benefit to our nations and bring people closer to nature, beauty and history. That was the vision of our founders 125 years ago and it remains undiminished today. To achieve it we need now to adapt to the changing world around us.’
The next steps
Our plan and proposed redundancies, which are also being discussed with our union Prospect, are now subject to a 45-day consultation period.
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