The voluntary sector is feeling the cold winds of austerity. But it is also discovering some important reserves of strength. Government should take note
These are tough times for nearly everybody at the moment and charities are no exception. Much of the focus of debate has been on the impact of funding cuts – and rightly so, as a number of organisations have had to deal with the short, sharp shock of seeing grants end or contracts not renewed.
The shift from grants to contracts and commissioning is hardly a new phenomenon, but it’s the challenge of providing services for more people on fewer funds that has left some voluntary sector leaders feeling under pressure.
Yet the National Council for Voluntary Organisation's quarterly survey of charity leaders, Charity Forecast, suggests that whilst the challenges are real, many organisations are finding ways to keep their heads above water, for example by delivering more public service contracts. And although sector leaders are realistic about the challenges they face, there is sense of collective resilience about riding out the storm.
One of the most important insights from our monitoring is that members are planning to do more with less, based on the needs and the demand they are experiencing. This approach is is not just a cliche; it is writ large in the actions of our members, and is not about cheese-paring costs to already squeezed organisations.
One area in particular that this is being developed is in our members’ involvement in the design and delivery of public services. We are hearing how charities have redesigned or co-produced their services to better suit users’ needs. Some have even gone the extra step by involving communities not just only service delivery, but also at the design stage of the commissioning process.
Sector leaders aren’t daft – they know commissioners are under equivalent pressure. But reliance on a funding system that seems only to reward scale is a concern raised in our regular monitoring. Yet every day at NCVO I hear about innovative approaches to service delivery or new approaches to resourcing old problems that exemplify a fighting spirit.
Many of these approaches are about working with public bodies, putting aside old enmities in some cases, and relentlessly focusing on outcomes. So government needs to be helping charities by opening up the commissioning process to make it easier for small agencies, who are often the service specialists, to compete for contracts.
This is all vital. But money still matters. Innovation and new ways of collaborating still need heat, light and buildings. And we know that for small organisations in particular, small amounts of funding make a big difference.
Tax reliefs are an example here: the 20% discretionary relief on business rates offered by many local authorities is an important part of the funding landscape for many. The Gift Aid small donations scheme, if we can get this right, similarly can make a difference to small, local charities.
The road ahead will have many bumps for those in the public and voluntary sectors. But it’s good to see that confidence in our ability to reach the destination is rising, albeit from a very low base.
The challenges we all face: scarce resources, rising need – aren’t going to be met by working alone. Building on the many examples of different bodies working together, focusing on the communities we are jointly here to serve, is ultimately what will give us the confidence to face the future.
Karl Wilding is head of policy at the National Council for Voluntary Organisations
