Voluntary and Charitable Sectors

Baroness Scott of Needham Market Excerpts

Thursday 26th June 2014 Lords Chamber

Moved by

[Baroness Scott of Needham Market]

To move that this House takes note of the role played by the voluntary and charitable sectors.

[Baroness Scott of Needham Market (LD)]

My Lords, it is a great pleasure to introduce today’s debate, and I am grateful to my noble and learned friend Lord Wallace of Tankerness and my noble friend Lord Newby for selecting this topic on one of two Liberal Democrat debate days. I declare an interest as chair of the National Volunteering Forum, as a trustee of the Industry and Parliament Trust, and as patron of Ace Anglia, which provides advocacy and support to people with learning disabilities in Suffolk, and of Wings of Hope, which is an educational charity focused on India and Malawi. I very much look forward to hearing from the other 20 noble Lords who will speak in the debate. With all due respect, between us we have many hundreds of years of experience in this sector, and I think the insights today will be very valuable.

What makes this sector so vibrant, so flexible, often challenging and occasionally frustrating is its very breadth. Charities such as the National Trust, the RSPB and Oxfam are household names. They have hundreds of thousands of members and significant incomes. There are thousands more tiny local charities set up to respond to particular circumstances, sometimes even the plight of one individual who needs help. There are around 161,000 registered charitable organisations, and an estimated 600,000 which are not registered. However, 90% of charitable income is made by the top 10%. I would not want this morning’s debate to go by without paying tribute to the millions of volunteers and family carers who, often under very trying circumstances, display a quiet daily heroism.

This sector provides both quality-of-life services, such as those of the National Trust, and lifesaving services, such as those of the RNLI and the Red Cross. The Society of Friends reminded me of the important role which charities play in the campaign for change, and how important that is at a time when people are increasingly disengaged from party politics. Of course, as we go into the general election next year, I reflect that most of the political activity which is undertaken in this country is done by unpaid volunteers. We should remember that contribution, too. In some cases, the volunteers provide the service, and in others they raise money so that professionals can do their jobs. Charity shops alone raise around £300 million every year for their organisations.

With this variation, finding the right policy framework for all of these circumstances is very difficult to get right, both for government and for regulators such as the Charity Commission. It also makes it quite difficult for the sector to speak with one voice. I will leave it to other noble Lords with more experience to talk in depth about the legal and financial framework for charities. However, I want to start with a few general comments on that aspect, before going on to talk about volunteering, which is the main thrust of what I want to say today.

The total yearly income of the charitable and voluntary sector is £39.2 billion. That is down £700 million on the previous year, largely as a result of reduced public funding. Despite the recession, NCVO says that charitable giving is holding up reasonably well, although anecdotal evidence suggests that organisations are having to work much harder to raise their money. Voluntary organisations are also reporting an increase in demand for their services, and there is now a real question about how long they can afford to do more with less.

The recent cross-party report, Creating an Age of Giving, referred to a civic core of givers, but it refers to the fact that that core is ageing and shrinking. Investment in schemes such as payroll giving and technology that enables text donations, for example, and the use of social media, have proved to be very worthwhile. I hope that the Minister will tell us whether the Government will continue to provide the seed corn money required to develop such schemes.

Gift aid is really important, but the new small donation scheme is looking significantly underspent. Anecdotally, it would appear that that is because it is just too complicated. Will the Government undertake to see whether that is the case and make changes quickly if they need to be made?

UKCF’s Shine a Light research of December last year found that people are nearly twice as likely to feel confident when they give money locally, as opposed to nationally, that it is actually going to help those who need it most. More than half of them would give more and give it locally if giving was easier and they could see the impact of their donation. That is emphasised by the publication, just this morning, of a report by the Charity Commission on public trust and confidence. It makes the same point about people wanting to see how their money is being spent and the impact.

One area where you can best see that at work is in the community foundation movement. Like most shire counties, Suffolk has a community foundation, which supports a wide variety of charity and community projects throughout Suffolk. By making endowment-giving easy, it has provided a sustainable way to support local organisations. Match-funded schemes such as Community First have been a real boost. I hope that the Government will keep that success in mind and work with the community foundations to see how the schemes might be expanded. Recent evidence is showing an increase in local giving and a more thoughtful model of giving, which is a really important part of building a strong civic society.

Of course, what makes the charity sector is the volunteers. The best estimate is that there are about 15.2 million people volunteering every month, so there is clearly an incredible capacity for volunteering in this country, but there are concerns that the volunteer workforce is ageing. People are working longer, caring for very elderly relatives themselves, perhaps even becoming less altruistic, and it is becoming difficult to recruit new volunteers. It takes money to resource organisations and projects specialising in helping people to access volunteering opportunities, but we need to do that to widen the pool from which our volunteers are drawn. For example, the Access to Volunteering fund, piloted in three areas, supported about 7,000 disabled volunteers to become involved. That brought with it reports of improved well-being and significantly reduced isolation.

A few years ago, I had a conversation with a researcher who was looking into something called micro-volunteering. Partway through, I realise that what she was actually talking about was what I would have called “doing someone a favour”. In today’s disconnected, slightly impersonal world, that sort of thing is dying out. It seems very odd to people of our generation, but there is a huge role for social media, for example, in making those connections between people, because the old community connections are lessening.

It is also important to recognise that the old model, where volunteers would commit a certain amount of time every week and would do so over a lengthy period, is very challenging for a lot of younger volunteers who have work and family commitments. They need more flexible volunteering opportunities. In Suffolk, the 2012 Olympic volunteers have formed a sort of permanent cohort of volunteers who come in and out for all the major events in the county; its success is in its flexibility. New technologies can be really important.

There was a time when the public, private and charity sector all had separate but very well understood roles. The picture is now much more complex and the lines between them are really quite blurred. Some of these developments have welcome aspects, but there are challenges. One of the most difficult issues facing the sector is the use by government of volunteering as part of unemployment policy. As I said before, we can all accept that volunteering can play a really important part in getting unemployed people out of the house, learning new skills and generally increasing their self-esteem. However, there is sometimes a question of compulsion. Someone who is made to volunteer in order to get their benefits is not a volunteer, and we should not call them one. These are work placements, and we have to understand that it makes life quite tricky for the existing volunteers to be working alongside people who are there only under duress.

Secondly, the Government need to remember that charities and voluntary organisations do not have an unlimited capacity to absorb volunteer labour wherever it comes from. There are too many reports of jobcentres simply sending people along to voluntary organisations with no thought as to how the organisation is actually going to use them. The voluntary organisations themselves need enough professional staff to be able to manage volunteers effectively, even when they are welcome.

All this is made very complicated by the increasing use of the third sector to deliver public services. Current estimates are that the contracts are worth just over £11 billion. I am in favour of this development, but we have to recognise that it limits the ability of the charity or voluntary organisation to set its own priorities. What happens then is that gaps in service begin to appear. It also compromises the perception of the public about the charity as independent of government. That has come out very clearly in the report published by the Charity Commission today: when a charity becomes dependent on public contracts for its survival, its independence can be jeopardised.

I shall make one or two points on the question of tendering for public services and the issues facing charities that wish to participate. First, the bidding process is often based on driving down price, which usually means labour costs. Most voluntary organisations do not pay their staff particularly well, but they do want to be fair. They want to pay the living wage and give their staff decent terms and conditions, but it is often difficult for them because they are competing with the private sector, which has no compunction about the use of zero-hours contracts or short-term contracts or with paying less than the living wage. Quite often the third sector is heavily disadvantaged when it comes to tendering. It is not just a moral question; evidence from the Living Wage Commission demonstrates that the Treasury could save more than £3.6 billion per year if everyone was paid the living wage. I wonder whether it is the business of the public sector to be discouraging the voluntary and charitable sector, which treats its workers well, by favouring the private sector.

Too often the relationship between the voluntary sector and the statutory commissioners is “us and them”. The commissioners are very controlling and do not really look at value or service delivery; it is really just about the money. Of course, when budgets are so pressed and when financial survival, territorial ambitions and all these things come into play, we can see why this might happen, but I think it is time for the Government to review it. Government and local government are major commissioners of services from the charity sector, so I support the NCVO call for a review of public sector markets to see whether they are still fit for purpose. A lot more training is needed for commissioners to ensure that when they say that service users’ needs must come first, it actually means something and is genuinely reflected in procedures. That means that we have to talk to the users. That is one reason I became patron of Ace Anglia in Suffolk: it provides advocacy for people with learning disabilities. It is really important to have a dialogue with people when tendering for the services that are going to affect them. Too often, it is either all about the money or it is about a superficial judgment of what people might like. You actually have to talk to people.

Sam Younger, just before he left the Charity Commission, said:

“There is too much duplication in the charity sector and too many charities are inefficient and poorly managed. Too many people set up a new charity without establishing whether there is a genuine need or whether another charity is doing similar work … the result is duplication and inefficiency … especially in an environment where charities are competing for resources”.

That is the dilemma. When you look at it like that, from a strategic point of view, what he says makes absolute sense: there is not enough money to go around so duplication is a luxury that we cannot afford. However, if you look at it from the bottom up, from the point of view of individuals, there are many examples of where, collectively, the private, public and even voluntary sectors are simply failing to meet their needs. When that happens, the obvious response is to set up a new charity. That is why something like 2,500 new charities are being set up every year.

As I said at the beginning, the picture is complex and in many ways is getting more so. However, and I think that we would all agree with this, everywhere across the country we see volunteers, charities and community groups of all sizes taking an active role in addressing the problems of their area, building communities and campaigning for change. They are building a stronger civil society and a new social economy, and we should do everything that we can to help them.

--- Later in debate ---

[Baroness Scott of Needham Market]

My Lords, I thank each one of the 20 contributors to the debate whose contributions have been thoughtful, wise and, above all, rooted in experience. What has come out is that, despite all the challenges there is still an essential optimism for the future of the sector and its importance. We have given the Government much to think about and I hope that they will reflect seriously on the points that have been made.

They say that charity begins at home. I wonder whether collectively, as an institution and organisation, we are doing enough here. Parliament is one of the largest employers in London and I have tried for two years to set up a volunteer system for our own employees, and have had no traction with that. Perhaps other noble Lords might like to help me. I am not sure that we do payroll giving. I do not know whether we are collectively setting the example that we should, despite all the good work that I know we all do individually.

Motion agreed.