Councils and other public sector bodies are reacting to governmen cutts by cutting spending of up to £5bn on charities that have been providing services to them.
A document produced by ACEVO for the attention of ministers was circulated in the Cabinet Office and the Treasury. The document went on to explain that the most deprived 25% of the country has been most severly hit. These areas will have seen two thirds of funding cuts compared to 7.5% cuts in wealthier areas.
Charities are losing upto 43% of their income, the hardest hit sectors are;
- Education and training, which loses (£335.8m)
- Children and families (£287m)
- Health and social (£285.1m)
- Homlessness (£112.3m)
Furthermore;
- A large number of charities in the north west and north east have appealed for help from the £100m governmnent transition fund
- 16 charities which appealed for transition help are on the verge of closure
- 566 charities have lost £366,679/ 50% of their income
This puts a whole new gloss on the future of the Big Society and the notion that we are all in this together. This does raise the spectre of increased mergers acquistions and consortias.
I thought big society was about independence from Government funding and control. The third sector being accountable directly to their customers and partners in exchange for payments such as voluntary service provision sourced from within local communities.
If charities are dependent on Government funding, this is not a reduction of the state but the opposite- an enlargement of the state through a form of outsourcing.
If tax-payer funds are used to direct third sector activities, this is a form of state intervention and control rather than my understanding of the Big Society – the transference of action, decision making, financing and accountability away from democratically accountable hubs of Local and Central government centralising planning.
From this perspective the reduction in Government funding is a progressive and necessary step forward in promoting the freedom to embrace the Big Society across the third sector, rather than remaining anchored to the mindset of shaping services to meet Local Government funded/directed outcomes.
The reduction of Local Government funding presents a requirement to adapt business models, but without moves to rapidly remove the training wheels of state aid any change to a Big Society would be slower? Those authorities reducing funding quickest can be seen as those who are the strongest in supporting the change to a Big Society and small government.
If the Big Society is not this, instead simply a move to utilise organizations incorporated as either not for profit or holding charitable status, but reliant on direct taxpayer funding then this is surely a less efficient way of delivering services than simply directing the public sector to do the job themselves – with associate flexibility, economies of scale, accountability for managing public money, overseen by democratically elected representatives? The debate therefore does not change from the status quo in existence before the coalition were elected with a Big Society agenda.