How to rescue the Big Society
With debate raging around the Big Society, we have launched an action plan for how the Government can ensure the agenda delivers maximum benefits for individuals and communities.
Responding to David Cameron's speech earlier today, Sir Stuart Etherington, our Chief Executive, said:
"We support the idea of the Big Society, but the Government needs to take swift action now to ensure that voluntary organisations survive to deliver it. It should double the Transition Fund and broaden its criteria so more groups can benefit from it. Local government must also be supported to make long-term, intelligent decisions, to prevent the sector from being seen as a soft target for spending cuts.
"Finally, we urge the Government to prioritise reforming Gift Aid and addressing the issue of irrecoverable VAT on shared services. This would help voluntary organisations to weather the financial storm whilst continuing to provide vital services."
Our plan, launched at the end of last week, offers a series of measures which will help voluntary and community organisations to weather the financial storm whilst playing their full part in delivering services and supporting their beneficiaries.
Our recommendations are:
- Doubling the Transition Fund, and extending its scope and scale Under the current proposals, £100 million is being made available to help medium-sized charities deal with cuts in public spending. However, NCVO has raised concerns over the short timescale and restrictive criteria for applying for support. If organisations go bust in the months ahead, the government will need to pick up the slack, so a short-term cash injection could save huge amounts of money in the long term.
- Supporting local government to make intelligent, long-term strategic decisions, so that they do not make the community and voluntary sector a soft target for cuts.
- Getting behind the Private Members Bill on Public Services (Social Enterprise and Social Value) This Private Members Bill, tabled by Chris White MP, recommends that commissioning and procurement processes for public services should focus not just on the financial value of a service, but also the social and environmental impact that it delivers. NCVO believes that this would create a more level playing field for charities, and make services more responsive to community need.
- Simplifying and modernising Gift Aid Gift Aid is an important source of income for the charitable sector, but donor usage has plateaued in recent years. The Government should simplify Gift Aid, shift the system online and ensure that donations through innovative fundraising mechanisms, such as SMS, are easily Gift Aided.
- Investigate the case for making Lifetime Legacies available in the UK, to promote a culture of philanthropy.
- Addressing the issue of irrecoverable VAT, including on shared services Under the current arrangement, charitable organisations cannot reclaim VAT on the cost of sharing services, while private sector organisations can. While we are not asking for special treatment because of who we are, we want the government to make the system fairer, which would in turn incentivise collaborative working. NCVO has raised this concern with the Prime Minister and Chief Secretary to the Treasury.
- Stimulate the social investment market The social investment market will form an increasingly important element of the re-balancing of sector financing as funding from statutory sources falls. Getting the right tax incentives in place is important and government should look at Community Interest Tax Relief (CITR). CITR is the principal tax incentive for social investment. However, take-up has arguably been disappointing and we would encourage government to review and promote CITR and extend the range of eligible organisations.
Sir Stuart said:
"Big Society has had a bad press recently but our recommendations make clear that there are ways for bringing it back from the brink. By taking heed of these recommendations it could signal loud and clear that it wants to support VCOs to play their full part in delivering the Big Society.
"Now is the time to act, otherwise there's a real risk that the organisations at the very heart of Big Society will not survive long enough to see the vision become a reality."