Archive for the 'Localism' Category

Charities in 2012: little stars twinkle out from the gloom

It’s pretty grim out there right now for many charities. Demand for their services is increasing, and the needs of beneficiaries are getting more complex. Spending cuts and low returns on investments means there’s less money to go round.

But, as Debra Allcock Tyler recently pointed out at the Directory of Social Change’s (DSC) Social Change Awards, no matter what happens over the next year, people will still be born, get together, have children and muddle on with their lives. Other commentators, such as the Royal Society of Arts (RSA) chief executive, Matthew Taylor, have also talked about the need to stay positive and to look on the bright side during these uncertain times.

So developing their theme, and without being naive, are there any positive glows for the voluntary sector in 2012? And, if we are going to be positive, how can we make the most of the opportunities which will exist, while remaining realistic about the challenges?

The very fact there’s a sustaining and enduring civil society should be a continuing cause for celebration. Dame Suzi Leather, chair of the Charity Commission, speaking at the the DSC awards ceremony talked powerfully about the continuing interest in and importance of civil society. Reminding us that, on average, 25 new charities register every day, she said that they are there “because of the need for our civil belonging”. No doubt some of these new charities are being formed precisely as a response to these hard times.

And it’s worth remembering that not all of these organisations are chasing public sector money or contracts: 64% of charities do not receive any public funding. Many are small community-based organisations, and rely on fundraising and voluntary effort.

The latest Charities Aid Foundation/National Council for Voluntary Organisations giving survey shows the value of donations staying static over the last year, but it also shows more people are donating and that they’re increasingly doing so online. Given the current climate, these results show that giving is holding up rather well, which must be encouraging news going into 2012.

While contracts inevitably favour larger organisations, it’s still the case that local organisations, which focus on making the connections at a neighbourhood level, building up skills, “passporting” what they do, rather than scaling up, could still flourish in 2012. An example is Pathways 2 Progress, a west London project providing mentoring and empowerment to young people at risk of involvement in serious crime.

It has an impressive record because it has great people involved in the project; it works hard at making links in the local community, cultivates local businesses to provide funding and job opportunities, and hasn’t tried to become too big or inhuman.

Many of the provisions within the Localism Act also come into force from April 2012. Sector organisations can nominate a list of assets they think are integral for community life, and local shops, pubs, post offices and libraries have been quoted as examples. If the owner wants to sell the asset, there is a “right to bid” for it, and a six-month period for funding to be organised. 2012 could therefore see the continuing growth in new forms of mutual ownership, such as the Metfield Stores, a co-operative community interest company. (Rumour has it; the Metfield Stores was also the inspiration for The Archers community-run village shop).

Next year is likely to be a time when there are louder and shriller voices calling for charities delivering public services and in receipt of public funding, to be barred from political campaigning. The sector’s voice in speaking truth to power and speaking out on behalf of their beneficiaries is one of its powerful hallmarks. Of course, charities have to make a judgement and consider the consequences of speaking out, and to think through whether the potential gains are worth the possible downsides. But the prolific use of social media means that there will always be people ready to do so, and in 2012 it simply won’t be practical to put the sector’s voice back in the box.

So yes, next year will still have challenges for the sector and it won’t be easy. But, to misquote the Christmas carol, there will still be some little stars which twinkle.

Rosie’s blog first appeared in Guardian Voluntary Sector Network.

Squeezing the middle

The age of austerity is affecting organisations in all sectors, but times appear to be particularly tough for local voluntary and community organisations delivering local public services. This is the sector’s ‘squeezed middle’: organisations that are too big to survive without funding, but too small to achieve the economies of scale needed to thrive in a more competitive environment. They are discovering is that it is hard to be a mission-driven organisation in a cuts-driven world.

Many of these organisations began life by challenging the way that public services were provided: identifying gaps and piloting new ways of delivering services to meet people’s needs more effectively. They were localism in action. That is why the sector has tended to be strongest in areas where the state has been weakest, for example in child protection and adult social care – for many years the ‘Cinderella services’ of the welfare state.

Opening up all public services to ‘any willing provider’ will create new opportunities for some, but not necessarily for this squeezed middle. I can only think of one or two national charities who may be interested in taking over some acute health services, for example. And in spite of all the talk of voluntary organisations running prisons in recent years, it is still just talk. Many, if not most want to continue doing what they do best: providing high quality specialist and niche services to local communities.

Yet this is more difficult to do when commissioners are going for fewer, larger contracts to help balance their budgets. And at a time when VCOs are competing for funding with organisations from all sectors, including major players in the business world – indeed, it could be argued that in this environment the very concept of ‘voluntary sector funding’ will soon be consigned to the history books.

VCOs are fighting back. We recently spoke to one CEO of a medium sized charity who has spent many months building and leading a consortium of local VCOs to bid for a large, single contract to provide services locally. Now waiting to hear if the bid will be successful, she highlighted the tensions and dilemmas for mission-driven organisations in the current financial climate:

‘I am perfectly comfortable being business-like, but that doesn’t mean I want to be more like business. I made a positive choice to come into this sector because I share its values and principles. Because it puts the user first, it’s not just about the bottom line.

‘I’ve put together the most competitive bid I can without compromising on quality or values; I would rather see my organisation go to the wall than do that.’

To some extent these concerns are shared by commissioners. As one senior local authority manager told us:

‘With the cuts we are in danger of losing real expertise, commissioners with specialist knowledge of services are being replaced by generic procurement officers who know a lot about process – EoIs and PQQs etc – but little about outcomes. I’m really worried that this will mean that contracts will go to those who can put in the best bid, not those who can deliver the best service.’

The Coalition Government is keen that, in spite of the cuts, the voluntary and community sector should play a key role in delivering public services – getting a larger slice of a smaller cake. Its best value guidance, for example, attempts to create a level playing field by emphasising the importance of social as well as economic value.  But, as always, policy is made as much by the actions of those on the ground as by the intentions of Ministers. And the reality on the ground is that local VCOs are being squeezed hard.

Belinda’s blog first appeared in Civil Society.