A DROP in income spelled doom for long-established Keighley housing charity Key House Project, according one of its administrators.

Project bosses explored various organisational measures, including reducing overheads and merging with another organisation, before the charity went bust last month.

Thirteen out of Key House’s 15-strong workforce were made redundant when the charity went into administration on June 22.

Two staff members have been retained to help with the closure of the business and managing existing tenants of Key House Project’s rented housing stock.

Keighley councillor Khadim Hussain, who in the past worked closely with Key House, this week described the loss of jobs and advice services as “devastating”.

Details of what happened to Key House were revealed this week by Graham Newton, business restructuring partner with administrators BDO LLP. Mr Newton said that in recent months, Key House management and trustees had made “significant efforts” to deliver the best outcome for all involved.

He said this allowed the Legal Aid team to transfer to another organisation, Foundation, before the administrators’ appointment.

Mr Newton added: "The joint administrators are working closely with all relevant parties, including the local authority, to minimise any disruption and to ensure tenants are supported and services transferred to appropriate alternative providers.”

Mr Newton said Key House Project had been funded mostly through local authority contracts and grants.

He said: “Unfortunately, a reduction in income has impacted significantly on the charity’s business and cash flow.

“Management took steps to mitigate losses by reducing overhead costs and the trustees also explored a merger with another charity. However, following a significant due diligence process, it was not possible to progress with a full merger."

Cllr Hussain, whose Keighley Central ward includes Key House’s base, said several years ago he had worked for Key House on a successful project finding housing jobs for graduates.

He said the charity had fallen victim to changes in social housing policy and council reorganisation, amidst pressure on the entire voluntary sector from changes to the funding climate.

He added: “I know Key House was struggling for some time. It could not raise enough from its housing stock to subsidise the running costs and maintain staff.

“It’s a double whammy – the loss of staff and the valuable services they provided to help vulnerable people. They did a massive job – housing advice, social housing and benefits advice.”