Public Services Reform, Retrenchment and Charity Finance
Executive Summary The political and wider public debates over the impact on charitable/ voluntary organisations and social enterprises of the far-reaching costreduction programmes unleashed by public sector organisations continue to intensify. There remains uncertainty as to future contract and grant funding and historically under-funded areas outside Councils’ and PCTs’ fields of statutory responsibility are subject to particular pressure. This Board Paper argues that the leaders of charities, voluntary organisations and social enterprises need to equip their organisations – in terms of skills, financial planning and control systems, strategic self-awareness and good data on costs, financial and non-financial performance – for a changed financial ecosystem and risk universe. This involves strategic conversations and hard decisions, not about doing only what can be done with diminished funds from existing sources, but rather about how to identify, measure, fund and deliver what will be important in a rapidly-changing operating environment.
With the advance of Big Society policymaking and public services reform accelerating across the whole of Government, the Government’s intention to devolve a greatly increased share of responsibility for the delivery of services to charitable and voluntary sector organisations and social enterprises is becoming clearer by the day. Despite recent pledges to extend financial support during the transition to the new, more open and entrepreneurial system, it is clear that there is not the political will or the ideological inclination at the centre to bring sufficient pressure to bear on the local public sector to ensure that civil society organisations have
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access to the resources they will need to shoulder the burden, in a context of fitful and uneven voluntary giving by both corporate and individual donors and dramatically reduced investment income. On the heels of