Are there too many VCS organisations?

OK it's the USA but Aaron Renn hits a chord with me:

When I look around older cities, I frequently see that they’ve got a veritable armada of non-profits. Rarely do I see these making a huge difference in the trajectory of the city.

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Try to do anything in a city and you’ll be told to meet with all these “stakeholders”, a large percentage of whom are non-profit leaders who claim to speak in the name of some constituency or cause but too often represent their own personal fief.

Anyone wanting to do things in a city has to run this gauntlet of non-profits and find a way to placate them.

Of course, here in the UK we call them the 'voluntary sector' or 'VCS' or 'Third Sector' but the same applies. There are brilliant organisations out there doing fantastic work but for each one of these there seems to be at least one other best described as a 'grant farmer' - sustaining itself and its staff by chasing grants to 'deliver' projects created and designed by local, regional or national public bodies.

As Renn concludes:

In cities, the Pareto principle likely applies to non-profits as it does everywhere else: the top 20% most effective non-profits deliver 80% of the public benefits.

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Everything that's wrong with lottery funding - in one quotation

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The quote is from a chap called Henry Kippin who works for an organisation called Collaborate CIC (who do something very important around" creative thinking, policy development, and a ‘shared space’ for insight, debate and problem-solving"). It's in the house magazine of professional urban nonsense, New Start:

A proactive navigating of sector boundaries has precipitated more creative, iterative and diffuse ways of reaching scale – blending public funding with social finance and a more proactive role for the private sector. Far from protecting a sense of safe isolation, funders celebrate confident interdependence and regularly take collective risks on path-breaking initiatives to build social capacity and resilience. The impact on funding beneficiaries feels profound; offering the possibility of new routes to impact, and an alternative to the increasingly fraught relationship between social action and the local state.

I'm pretty sure that Henry knew what he meant when he wrote that paragraph - it's a picture of the 'social funding' environment in 2025 if we all do what Collaborate thinks we should do. The problem is - and I know you've spotted it - that the prediction does actually say anything of substance. Roughly translated it says that 'social funders' (that's the lottery, charitable trusts and other formal philanthropy) will be most effective if they work in partnership with the public sector in their funding decisions. You could call it 'collaboration' but in truth its the alignment of private initiative with the policies and priorities of the state.

Such an arrangement suits the public sector and, since that is the pond in which they swim, also meets the needs of those who work for the big social funders. But for that social funding to be most effective it should be challenging the state - investing in things that government can't or won't do. This isn't about plugging perceived gaps in provision but rather is a route to new ideas and new activities. What Henry and his pals are proposing isn't a beautiful collaborative future but rather the de facto nationalisation of social funding - the further submission of charity to to objectives of big government.

Right now most of the social funding out there goes to a very limited pool of recipients. Funding is most likely to go to organisations with full time workers where the focus is on capacity, social infrastructure and campaigning rather than on what most of us normal folk think of as charity. Most of the social action taking place today isn't being done by these organisations but rather by a host of little groups doing things they think important. Nine out of ten charities and community groups don't employ anyone yet to read what organisations like Collaborate say you'd think this was the exception not the norm.

If social funders want to make a real difference they need to change what they do and how the fund. Not by getting more cuddly with the state or even holding hands with private business, but by widening their net and supporting the small battalions of volunteers that really do make a difference in all our communities. Sadly though, people like Henry with their jargon-ridden wibble will win the day meaning that the distance between real voluntary work and the activity of the "third sector" gets ever larger.

Thousands of organisations simply don't bother approaching those big social funders. Not because they don't need support and aren't doing great work. Rather it's because they take one look at the information provided by the funder and decide they have no chance of getting support. "No point in us applying for funding, they never give money to organisations like us round here" - I've heard this dozens of times and, however much Henry and his pals want to say it ain't so, I know it's the truth.

So if Henry wants to change things - wants a better future for 'social funding' - he should start arguing that support should be directed to real social action being done by ordinary people in every community rather than for some sort of grand unified theory of collaborative funding that's really just code for doing what the government wants.

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Oh no, we're not lobbyists...say lobbyists for the 'third sector'

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Acevo and NCVO (see how I slip so sweetly into the acronyms of lobbying - the Association of Chief Executives of Voluntary organisations and the National Council of Voluntary Organisations) are twitching at the prospect of a lobbying register and its 'unintended consequences':

The chief executives body Acevo and the National Council for Voluntary Organisations have written a joint letter to Nick Hurd, the Minister for Civil Society, to ask for a round-table discussion about the possible "unintended consequences" of a proposed new register of lobbyists for charities.

So what are the worries?

In the letter, Sir Stephen Bubb, chief executive of Acevo, and Sir Stuart Etherington, chief executive of the NCVO, said they wanted to ensure that any register "does not unintentionally prevent, impede or dissuade charities from doing the vital work they do in informing government policy".

That would be lobbying, no?

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Charity isn't independent so long as it takes the government's cash...

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It may be the effect of opposition but Labour folk are keen to see the "third sector" distance itself from government. Here's the fresh new MP for Wigan:

"The Labour government treated the third sector like a third arm of the state and I was troubled by that," she said. "I thought it was problematic. Delivering government services means you have to agree with the government about how those services should be run."

As they say, Lisa, 'he who pays the piper calls the tune'!

Despite this the sector seems ever more conflicted over its relationship with government - sure, charities, social enterprises and such want to be 'independent' but they also seem to be firmly attached to the teat of public money. You cannot have it both ways - you can't take the government's money and then campaign against that government's policies.

So if you want an independent voice of advocacy on behalf of your beneficiaries then stop taking the government's cash, stop being sub-contractors to the state and raise your money privately from people who actually support your aims. Simple really!

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Why doesn't the "voluntary sector" want volunteers?

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Yesterday I went to a particularly untidy briefing on the changes and developments within the health service. Amongst general moaning about GPs (not helped by the fact that the GP who was supposed to be there wasn’t  - with the resulting disgruntlement from the seven councillors at the briefing very evident) and especially their tendency to resort to medication at the start of treating mental health patients rather than make use of community-based support services.

But this isn’t what I want to talk about. I want to talk about volunteering and why so many in the “third sector” seem to have some sort of ethical problem with the idea of someone doing something to help out without getting paid.

During the discussion the matter of volunteering by individuals on Job seekers Allowance was raised – part of the work programme is to encourage people looking for work to do some voluntary work while they’re looking for paid work.

“We didn’t go on the programme on principle”

The programme seems reasonable to me but for some in the so-called voluntary sector we have this weird, warped ethical barrier – and this appears to be supported by some administering the programme as this answer from the responsible minister at another event suggests:

An audience member questioned Hurd on her personal experience of barriers to volunteering, especially for jobseekers.

Hurd agreed, saying that there was enough evidence that there was a big problem in job centres: “I’ve heard it so often it’s got to be true,” he said. “There is a big problem in some job centres where fear spreads that if you volunteer, you could lose some benefits.

“The Department for Work and Pensions has issued guidance but this is a cultural thing. It needs to go way beyond guidance and look at changing the culture within job centres.”

The problem is that the DWP staff don’t want the hassle of finding placements and the “voluntary” groups will only do it if they’re paid.

It seems to me – and has done for a long while – that the voluntary sector is, in great part, indistinguishable (other than rhetorically) from for-profit businesses competing to deliver public contracts. Much is made of being “not-for-profit” and of “social responsibility” but these are quickly set aside in the unseemly scramble for contracts.

I completely fail to see what “principle” is involved in a voluntary sector organisation refusing to take on a volunteer – I really do.

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Take the King's shilling and you dance to the King's tune

The Directory of Social Change are in a funk about the conditions attached to contracts for the Office for Civil Society's 'Strategic Partners":

Jay Kennedy, head of policy at the DSC, told Third Sector that terms relating to the £8.2m strategic partner transition fund appeared to reward charities for promoting government policy rather than providing impartial advice.

Clauses in the application guidance sent to prospective bidders say partners must "contribute to the development of the big society agenda" and "help to support and deliver strategic policy of OCS".

 "The DSC does not believe that this should be the purpose of government funding for charities. If the OCS is going to pay for strategic partners it should be for them to give critical, constructive advice rather than to deliver policies that come down from the top."

Everywhere charities are taking government funding and "delivering" the government's agenda. That's the deal - there isn't any difference between these 'strategic partners' agreeing to support Big Society and other 'third sector' organisations twisting their values so as to land contracts from DWP, DFID or a host of local councils.

As the man says - you take the King's shilling and you dance to the King's tune. If charities want to be independent there's a simple answer - go out and shake those collecting boxes!

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Accumulation, earnings, proceeds, return, surplus, yield....thoughts on 'not-for-profit'

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There's no doubt that the term "not-for-profit" is one of the most annoying phrases - used mostly to enable the organisation or individual concerned to clamber up to the very tippy-top of the moral high ground.

Or else as a clever marketing scam!

What exactly does "not-for-profit" mean? Does it mean you plan to make a loss? Or that any excess money left over will be given away to the poor? Or is it just a euphemism for "I can pay myself loads of money but we don't have any shareholders and that's good, isn't it?"

For that's the case. Being 'not-for-profit' doesn't mean you're going good work, it doesn't mean the buyer isn't being ripped off, it doesn't stop you turning what would be dividends to owners into bigger salaries for managers and it's not a magic way of acquiring moral righteousness.

So I'm not impressed when I hear a very well-paid chief executive explain how their organisation is 'not-for-profit' while sitting on a comfortable - maybe verging on fat-cat - salary. If that isn't profiting from the organisation you run, what is?

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Don't believe everything the "Community Sector Coalition" tell you - especially when its members don't do much community work!

I stumbled across a bizarre critique of Big Society from something called the "Community Sector Coalition". For a moment I thought this might be a serious, thoughtful and considered analysis of the idea's weaknesses but instead it turns out to be another example of special pleading from a group of organisations that are what "third sector" folk refer to as "infrastructure" organisations.

These organisations adopt a representative, advocacy and advisory role for voluntary groups and organisations. Some - like those providing practical support on fundraising, finance, policies and HR - provide a pretty useful service which, frankly, voluntary groups should be prepared to pay for. But too many of these 'infrastructure' groups have got onto the merry-go-round of discussion, debate, analysis, pseudo-research and what the "sector" calls advocacy (but everyone else calls lobbying).

Now, I've nothing against any of this activity except to say that I do not see any reason at all why the government should pay grants to organisations so they can lobby the government to pay more grants to organisations that then lobby the government to pay more grants to...

...you get the gist?

Not surprisingly the "Community Sector Coalition" (none of whose members seem actually to do any community work) thinks the Big Society is a smokescreen for cuts. The "sector's" trade magazine - Third Sector - describes the meeting where this group discussed Big Society:

More than 30 organisations aired their concerns at the Community Sector Coalition meeting and made plans to tackle the "sham" of the big society initiative

More than 30!! Wow! Out of the tens or thousands of community groups only 30 want to have a pop at Big Society. And those 30 aren't really community groups at all but publicly funded 'networks', 'alliances', 'national associations', 'advisory services', 'institutes' and so forth. Not surprisingly such groups - as far removed from the Big Society as you can get - are worried that their cosy stipends paid with taxpayers' cash will disappear.

Big Society isn't about these groups but about not needing permission, 'infrastructure' or 'advocacy' to get on and do things - social action isn't about "the sector" it's about the rest of us. For all the great work done by voluntary groups, social enterprises and charities there are too many "Community Sector Coalitions" - too much talking, meeting and moaning and not enough doing, creating and having fun.

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Let me introduce you to real social enterprises

The world seems full of folk claiming that “social enterprise” is the way of the future. And, in doing so implying that good old-fashioned businesses – you know, the ones where I make something and sell it to you or do something because you pay me – are somehow “anti-social”.

Now I have no problem with how people organise their businesses – as a consumer I care only about the nature and quality of the service or goods I receive. Well that’s not entirely true – I’d also like them to behave ethically. But that doesn’t mean not taking a profit, not paying themselves well in recompense for the risks taken or not having shareholders. And it doesn’t mean having a “social mission”, it doesn’t mean “fair trade”, it doesn’t mean not owning shares in oil companies or aerospace manufacturers. These are just elements of a marketing strategy based on political positioning.

An ethical company is one that doesn’t mislead people about its products or services, that operates within the laws and mores of the country, and that seeks to exceed the service expectations of customers. Nothing more.

And, you know, all but a tiny handful of for profit businesses behave that way. These businesses are as ethical – perhaps more ethical – as all the Co-ops, so-called “social enterprises” strutting around out there saying “look at me, aren’t I the good boy”, and “third sector organisations” trying to pretend they aren’t really just government subcontractors.

There is nothing – absolutely nothing – more social than the market. The market requires people to engage, to interest, to participate. The market encourages people to compete, to create, to exceed expectations and to take risks. And the market also promotes co-operation, innovation and partnership. Businesses operating in a free market are social organisations – however they choose to govern themselves. These businesses have to interest themselves in their customers – what they want or need, what there problems may be, what help they might require. They are real social enterprises.

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