The Implications of Brexit on International NGOs Based in the UK

28/06/2016 16:58

Putting aside the utter dismay that I feel as an individual citizen of the UK and the EU on the outcome of Thursday's referendum, my priority this week as Chief Executive of HelpAge International is to digest and think through the many immediate and longer-term implications for the organisation that I lead. Identical exercises will be going on among all or very many of our peer agencies in the UK development and humanitarian sector.

The first challenge is the obvious instability in the financial markets and the weakness of sterling in particular. While the leaders of the Leave campaign issue relaxed "wait and see" messages about economic stability returning at some unspecified later date, or a weaker pound being good for exports, this certainly does not extend to the export of compassion.

We as a charity receive most of our income in pounds sterling and then convert and spend most of our income in other currencies. Before 9am on Friday, as the result was announced, I sent an email to our directors and regional directors, reminding everyone that we have no choice but to end the year within our board-approved sterling budget. In the two days that the markets have been open since the Brexit result became known, my committed colleagues and our partners in the regions and countries where we work have had to absorb what today is already a 10 per cent budget cut in most of their local currencies for the remaining 10 months of the year. This is a terrible outcome, in any year, but especially in a year where there is already considerable pressure on the unrestricted incomes of many charities in our sector. We are already mostly working with both a slight fall in public giving to most charities, and the transition of the UK Government from their Programme Partnership Agreements to a new and as yet unspecified strategy and modalities for their civil society partnerships with organisations such as ours.

The second challenge, short to medium-term, is to prepare for a future a few short years hence where, as UK-registered charities, we will simply no longer be eligible to apply for the majority of the funding that we currently receive from the European Union, principally EuropeAid for development projects and civil society strengthening, and ECHO for humanitarian assistance. We have already received emails from consortia partners today, clarifying if we can still be included on a major joint EuropeAid proposal with a deadline a few weeks hence (we can as it happens, but this will not indefinitely be the case, as the exit process is formalised and begins in earnest).

I have worked for UK-based INGOs (Oxfam GB, Save the Children UK and now HelpAge International) for most of the last 25 years - throughout my career, funding support and high-level technical and moral partnership with our friends in EuropeAid and ECHO who have been a constant feature of our institutional and normative landscape. EuropeAid has been a particular friend to organisations like HelpAge International who value funding to help develop their civil society counterpart organisations in the global south. ECHO is hugely valued for continuing to fund emergencies when the cameras have moved on, and for its continued strategy and track record of directly supporting their NGO partners, avoiding the temptation of using inefficient UN intermediary instruments and organisations that many other donors have succumbed to over the past decade.

We will miss their funding, but we will also miss their partnership across so much of our shared humanitarian and development agendas. Our sadness is not a selfish one - the UK has been one of the most generous member state contributors to EU development and humanitarian budgets, with DFID usually funding between 15 and 20 per cent of ECHO's annual budget. As DFID funding will presumably be pulled back post exit, all EuropeAid and ECHO partners will be affected, and, therefore, the communities they work with.

Wider still, question marks will also inevitably be raised about the resilience of the Government's current aid budget and its commitment to "0.7". The UK's continued commitment to 0.7 clearly has the status as the second "pantomime villain" to the same politicians and newspapers who emerged as the clear victors last week. Where will they head next, now that they have successfully killed off their first, our EU membership?

There will of course be "workarounds" - the larger NGOs mainly work now in international federations, with many European members all raising money for merged or merging operations at country and regional level. The easiest workaround will simply be for the non-UK European members of the big global alliances to take over the contracting of EuropeAid and ECHO funding from their UK counterparts. In the end, however, that will mean that technical and policy expertise that currently sits here will start to shift.

But perhaps the biggest consequence for people in the UK INGO sector will be this sense of moral "diminishment". The referendum campaign was closely watched, not just in Europe but around the world. Whatever the Leave campaign may say this week, no objective observer could fail to notice how much their campaign was designed to pander to and feed off the worst of human nature - exhorting voters in the UK to turn away from multiculturalism, to blind themselves to the benefits of immigration, to portray innocent refugees from Syria and Iraq as threatening our country, rather than fleeing theirs.

Almost everyone in our sector would be feeling simply ashamed and very sad indeed that these tactics were used at all, let alone that they succeeded.

DFID, the wider UK Government and the UK's vibrant and massive international civil society community have together all played something of a leadership role on the global stage for a great many years. Who of our international friends could not now say that we are less of a country in their eyes, given the disgraceful way in which aspects of this campaign were conducted?

Toby Porter is CEO of HelpAge International. He writes here in a personal capacity