06 February 2009
By Vivienne Russell
A £250m social investment bank should be set up to transform the role of voluntary organisations in helping people back into work, according to the Third Sector Taskforce.
The creation of the bank is the top recommendation of the task force, which was jointly established by the Association of Chief Executives of Voluntary Organisations and the Department for Work and Pensions to explore the potential role of the third sector in the welfare system.
The task force called on the government to make the social investment bank the priority for any funding released from the Unclaimed Assets Register – unclaimed money in bank and building society accounts.
Tony Hawkhead, chief executive of the charity Groundwork and chair of the task force, said radical and practical solutions were required to tackle the problems raised by the current economic climate.
‘Our sector can really help those most in need of support in these challenging times, but many of us are held back by the lack of suitable funding,’ he said at the launch of the task force’s report on February 4.
‘A social investment bank would enable social enterprises and charities to remain focused on reducing the impact of recession on some of society’s most vulnerable people.’
Work and Pensions Secretary James Purnell said: ‘Now more than ever we can harness the best of the voluntary sector to help people who are finding times tough during the global economic downturn.
‘We welcome the task force report and are committed to working with them.’ Last week, research emerged that highlighted the advantages to the public sector of contracting with the third sector.
A report from the New Economics Foundation – commissioned by the National Programme for Third Sector Commissioning – said using the third sector could provide public sector commissioners with social and environmental gains as well as monetary returns.
One example cited in NEF’s January 29 report is investment in preventative measures, which both achieve better outcomes for service users and reduce the need for costly future interventions.
It said that every £1 invested in higher quality residential care yielded a social return of £4.40 to £6.10 because care leavers had a lower chance of becoming Neets – people not in employment, education or training.
The National Programme for Third Sector Commissioning was established by the government’s Office of the Third Sector to encourage better use of voluntary organisations by public sector commissioners.
Programme manager Sarah Wood said clever commissioning could help the public sector juggle the demands of dealing with both increasingly complicated social problems and the need to control costs.
‘The public sector needs to think beyond simple definitions of the cost of services,’ she said. ‘Working with charities and local community organisations allows the public sector to draw on skills and services that are already available, better meeting the needs of local people.’
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