ONE of the region’s best known charities has asked staff to apply for voluntary redundancy or cut their hours to help safeguard its future, announcing: "we need to save a considerable sum of money". 

Details of the cost-cutting plan at Stockton-based Butterwick Hospice Care, which includes a pay and recruitment freeze, comes after The Northern Echo revealed this week that chief executive, Graham Leggatt-Chidgey had suddenly left the charity after more than 20 years at the helm, citing health reasons. 

Staff were told on March 20 that Mr Leggatt-Chidgey "unexpectedly had to take a period of emergency leave". They were asked to respect his privacy and to not contact him. 

Charities have endured a tough time of late as Government spending cuts heap pressure on the voluntary sector to pick up the shortfall in funding and services while the credit squeeze has hit the amounts being donated. 

In a memo sent to staff this week the trustees revealed Butterwick was "currently facing financial difficulties" and a long term review had taken place to "ensure our continued sustainability". 

The problems come less than two years after the death of Mary Butterwick OBE the charity’s widely respected founder who sold her home to launch its first hospice in memory of her beloved husband John after he died of cancer. Her tireless devotion saw the charity open purpose-built facilities in Bishop Auckland and Stockton where it continues to deliver care and a wide range of support free-of-charge to adults and children. 

In its latest accounts Butterwick reported a £29,724 loss in the year ended March 31, 2016 which was a dramatic drop from a £473,492 profit the previous year. 

Its 2016 gross income of £2,289,903 was down on the 2,398,027 made in 2015.

Its charity shop division, Butterwick Hospice Retail Limited, contributed only £8,756 compared to £70,803 in the year before, and its lotteries division contributed £263,419 down from £295,638. 

The John Butterwick Trust day care centre and hospice, and the Seven Wellbeing Centre, which offers complementary therapies and training, made net losses of £51,556 and £19,367 respectively.  

The charity continued to receive 29 per cent of its income from the NHS, the rest came from fundraising activities and donations. 

The total for donations and legacies in 2016 came to £1,412,652 down from £1,519,567. 

The main risk highlighted in the accounts by the trustees was their "ability to generate sufficient income to cover expenditure" but noting the "uncertain economic outlook" they had "reasonable expectation that the charity has adequate reserves to continue in operational existence for the foreseeable future." 

The accounts show the trustees said that the group’s cash reserves had been depleted due to "operational deficits" in the past couple of years a result of spending on capital projects, and they planned to rebuild reserves at a rate of at least £50,000 a year. 

Butterwick employs 176 people, who have received 2 per cent pay rises in only three of the last 10 years. It also relies on an army of volunteers who worked almost 160,000 hours free-of-charge during the year.  

Staff have been asked to come forward by Friday April 21 if they want to be considered for redundancy. The hospice, which did not take the opportunity to make a comment, has told staff it will do all that it can to avoid compulsory job losses.   

In the memo it said: "As an organisation, our primary cost is our staffing cost. Whilst we are able to make savings in other areas, and we are certainly looking at what savings can be made, the reality is that we are only going to save the amount of money we need to save if we reduce staffing costs. "Therefore, after considering all possible options, we have concluded we must ask for volunteers to reduce their contracted hours and volunteers for redundancy." 

All decisions will be dependent on the hospice’s delivery of services.