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February 8, 2012

Warning on independence

When public funds are as stretched as they are just now, the degree to which our sector is valued for being truly independent of the state (and the markets) becomes ever more exposed.  A panel established last year to scrutinise this very question has just published its first report.  It makes for gloomy reading – the spending cuts and current procurement practices are jeopardising the very future of the sector.  If we become viewed simply as a disposable extension of public or private sector service delivery, we’re done for


There are “real and present” risks to the independence of the voluntary sector, with support for disadvantaged groups under particular threat, warns the Panel on the Independence of the Voluntary Sector in the first of five annual assessments published today, pointing to the Work Programme as an important example. 

Threats to the three aspects of voluntary sector independence – of purpose, voice and action – have existed for some time, says the Panel, but have been considerably heightened by cuts in public spending and other income, and the way in which contracts are awarded. This means that some organisations have to choose between closure and agreeing to sub-optimal delivery. 2012 will be a crucial year, the Panel’s assessment says. 

The Panel, which has created a Barometer to measure voluntary sector independence, points to six major challenges: 

The effects of a contract model which favours large, often private sector, organisations and can be unnecessarily restrictive 

The inability of the voluntary sector to influence service design and delivery or funding models 

The blurring of boundaries between public, for profit and voluntary sectors, which may mask important differences and dilute independence 

Pressure for self-censorship, with some organisations fearful of using their voice 

Pressure on independent governance, as trustees seek to balance survival and independence 

Regulation and safeguards for independence that may not be sufficiently robust. 

Independence is crucial to a vibrant democratic society, the report points out, helping the sector to meet diverse needs that are often not recognised or properly met by others, such as working with the homeless and socially excluded, and ensuring a strong voice for marginalised groups or unpopular causes. There are concerns that paying organisations only if and when results are achieved can disadvantage both small organisations, with limited reserves, and the service users who are hardest to reach and need most support. 

The Panel examined the contracting arrangements under the Work Programme, which illustrate some of these concerns. Some voluntary sector organisations were squeezed out or ended up as sub-contractors to the private sector, with limited influence over contracts and the quantity or quality of their work, and suspicions that some had been used as ‘bid candy’. Only two voluntary sector organisations became prime contractors out of a total of 18, and one of those is an alliance of a registered charity in Ireland and a for profit company. This was despite ministerial support for the importance of the sector in this work. 

Chair of the Panel, Dame Anne Powers, said: 

“Governments of all political parties have stressed the importance of the voluntary sector. But there needs to be more than a soft, unfocused admiration for a Big Society or Third Sector. Central and local government and private sector partners have to recognise the sector’s hard edge: its independence, distinctiveness and ability to speak out from experience. If the voluntary sector is perceived to be simply the delivery arm of the statutory or private sector, or appears indistinguishable from either, it will lose the public trust on which it depends for volunteers, donations and tax benefits. Everyone will be poorer. 

“The next year will be crucial. Lessons can be learnt, and there are opportunities, as well as risks: for example embedding social value in contract terms, or using the review of the Charities Act 2006 to strengthen safeguards and support. Our Barometer of independence is at present indicating stormy weather ahead. Next year, we will gauge whether it is rising or falling.” 

The Panel calls urgently for greater commitment in practice from the government and the private sector to protecting independence of the sector. In particular, 

Recognising and respecting the distinctiveness and independence of voluntary organisations in funding, commissioning and other joint working arrangements, for example taking into account the social value they create when awarding contracts and encouraging their independence of voice; 

Understanding the diverse needs and value of different parts of the sector, including those of smaller voluntary organisations for whom complex procurement processes can be a major barrier.