SCORES of children's charities fear they will have to cut services, axe staff or close their doors altogether after a new Scottish Government fund was nearly four times oversubscribed.
The £20 million Third Sector Early Intervention Fund (TSEIF) was due to come on stream yesterday, but a decision on allocating cash has been delayed after more than 400 groups put in bids totalling £73.5m.
Organisations were told just before the Easter break that they will not learn until the end of the month whether they have been successful.
In the meantime, groups receiving public cash will have to apply for interim funding to keep them in business, while ministers try to safeguard the future of key charities.
A source at a major children's organisation said: "Many groups are looking for core funding that would make up 90% or 100% of their annual income, so their survival is on the line.
"The delay means there will be cashflow problems, which could put jobs at risk or interrupt services.
"But the situation also seems to have revealed deeper problems. The new £20m fund is significantly less than the funding schemes it was set up to replace. That might explain the delay, but it only adds to the fears within children's organisations."
The TSEIF was announced last year by children's minister Aileen Campbell as a replacement for three separate funding schemes.
They ran out yesterday when TSEIF was due to take over. The new fund will make £20m available over two years to support successful bidders.
Children 1st – the leading charity formerly known as the Royal Scottish Society for Prevention of Cruelty to Children – national youth work agency YouthLink and the Scottish Youth Parliament are believed to be among the organisations seeking TSEIF cash.
The Scottish Government subcontracted the administration of the TSEIF to the Big Lottery Fund Scotland.
In a statement last week, the Big Lottery Fund said funding decisions had been delayed until the end of the month as a result of the huge response and the Scottish Government was stepping in to negotiate additional "strategic funding partnerships" with a number of key bodies.
It added: "We strongly believe that taking the time to achieve strong partnership arrangements over and above the TSEIF will help us to collectively secure better outcomes for children."
Labour MSP Neil Bibby said: "It is ironic that just a week after Alex Salmond used promises on childcare to try to win votes in the referendum, his Government is leaving Scotland's children's sector in the lurch worrying if they will have to cut services, lay off staff or even close their doors completely in a few weeks.
"It's as though they've been caught out by their own hype and suddenly realised they can't meet their promises on early years.
"It's is a disgraceful way to treat people and I'll be taking this up with Scottish Government ministers to try to ensure these organisations and charities get the clarity and hopefully the funding they need to continue providing services for children and their families."
A Scottish Government spokeswoman said groups supported by the old funding schemes would receive extra cash until April 30.
She added: "No organisation will be worse off as a result of the TSEIF announcement being rescheduled. The TSEIF has received a huge number of applications, demonstrating the range of important work being delivered by the sector.
"We are keen to support as much of this work as possible.
"Negotiations will take place over the next few weeks, and we will announce the outcome by the end of this month. "
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