The relationship between civil society and the state is a measure of the political and social health of the UK. Is it flourishing? Does it have the support and space to grow? Does the Government respond to the concerns raised by civil society and the organisations who represent it?
Small charities are the grassroots of civil society. Over the last eight years small charities, grassroots civil society organisations, have been hit by the financial recession, increasing demand for services, falling or at best flatlining revenues, the transition between grant funding and commissioned contracts (in some cases payment by result) and importantly the changing structure of the environment they work in. Cuts in funding have created an ‘outsourcing boom’ with commissioners wanting more “bang for their buck”. This has made the marketplace that small charities work in almost unrecognisable and increasingly small charities are competing for funding with both larger charities and large corporate private sector entities.
Cuts in government contracts and the changing way in which funding is accessed is not the only issue that small charities are grappling with at this time. The small charity sector must address its continuing ability to remain independent of the state and small charities must remain focused on their own mission and values. An independent small charity sector does not mean that charities cannot compete to deliver public services; it means that small
charities must be wary of public sector contracts that tie them to activities and outcomes that are not completely in alignment with their mission.
The critical question for small charities and their future is how they build strong, resilient and sustainable organisations that are able to manage complex relationships with the public sector, the private sector and other civil society organisations. A key factor in the small charity sector’s ability to deliver services to those in society who are the most
vulnerable will be their ability to act autonomously in the best interests of those they seek to serve.
The small charity sector has a long history in the UK of supporting individuals and communities – locally, nationally and internationally. This research was commissioned to identify the challenges facing small charities and explore how small charities retain their independence in an ever changing market place.
CEO, Foundation for Social Improvement