Monday 4 August 2008

Charities at risk

The Tories started the trend towards greater use of charities and volunteers in the provision of services, and Labour have accelerated it. It's a trend which has always left me a little uneasy, however.

It's not that I want to knock the work of the charities concerned, nor to belittle the excellent work done by volunteers. They make a valuable contribution, and they both give and get a great deal of satisfaction out of the work which they do. 'Extra' services have long been a part of the work of charities. Nor is there anything wrong at all with central and local government giving grants to charities to help them fund the valuable work they do.

But what leaves me uneasy is the feeling that, increasingly, 'core' services are effectively being contracted out to charities and volunteers because the government can get the services cheaper that way, largely because of lower staff costs. What are often called 'partnerships' (don't government agencies just love that word?) seem often to be ways by which 'efficiency savings' can be made by simply moving the provision of some services from the public sector to the 'third sector'. The movement is only ever one way of course.

The services provided by charities are more and more subject to service level agreements which have to be met to justify the 'grants' which they are given. They're still called grants, but they look awfully like 'payments for services supplied' to me.

Today's story about the CAB seems to be taking this trend even further, as the organisation has been told it will have to bid for funding in competition with other organisations in future. This looks a lot like 'tendering for work' to me; with the charity competing directly against private companies providing the same services. Having tried to introduce private sector disciplines and practices into the public sector, it almost seems as though they are forcing charities to go the same way as well.

The government spokesperson said "The most important thing is to ensure equity of access to good quality advice services, coherency, cohesion and value for money". Well, yes, indeed. But that brings me back to the main point. If those are the criteria, should such services really be dependent on charities and volunteers in the first place?


Ian James Johnson said...

It doesn't 'look' like tendering for work - it is!

The Communities Legal Advice Centre (CLAC) is a programme designed to rationalise services, e.g. benefits and legal advice, provided to the public as a one-stop shop provider. The process involved includes tailoring a package of services which are, effectively, commissioned by the local authority and the legal services part of government, where formerly core grants were given to services and then supplemented by other means.

The first CLAC in existence, Gateshead, has already hit problems as one of the two main organisations running the system, Gateshead Law Centre, went insolvent within 6 months of the contract beginning due to long-term structural financial problems. New funding rules and employment regulations mean that they are unlikely to hit targets and will be retendered at the end of the contract.

More seriously, an organisation called A4e, a 'multi-national global public service reform leader' has begun to bid for these contracts, winning the Hull contract, leading to the loss of the £649,000 grant given to Hull CAB and likely to lead to its closure. A4e have pulled out of other contracts, e.g. an education and training contract in Kent, due to anticipated losses. What if they do the same in Hull in 3 years when this contract ends?

This is effectively a privatisation of the advice sector which will, inevitably, lead to job losses and depressed wages in what is far from the most lucrative area of law and the area where vulnerable people are those who lose out.

It is intended that Cardiff, the Vale and Bridgend CLAC will be operational from April 2010 at the latest - almost certainly leading to job losses amongst specialist smaller providers who will be unable to tender as they do not have the required expertise across a wide range of topics.

Ian James Johnson said...

Just to add an answer to the final question you posed, about why these services are in the hands of charities and volunteers - the reason is often to maintain an arms-length distance from central and local government (who are often the main funders) so that there is no conflict of interest when it comes to providing advice re: benefits etc.

John Dixon said...


Thanks for the comments. I understand the 'arms-length' argument, although since the organisations are still, by and large, funded by government, I'm not sure how much of their independence they really retain. I still believe, however, that having certain key functions performed by voluntary/ charitable bodies is a way of cutting costs and depressing wages.