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Tory contracts would let charities earn a profit, pledges Hurd

Finance | Tania Mason | 18 May 2009

A Conservative government would enable charities to earn a surplus from public sector contracts just as private sector providers do, shadow charities minister Nick Hurd told an audience of charity chief executives last week.

Hurd (pictured) outlined some of the Conservative Party’s proposals for the sector at a drinks reception organised by interim managers agency Russam-GMS.

He said charities delivering services for the government should be able to earn a return on their investment in the same way as the private sector does, in order that they can "scale up and replicate the services so that more people can benefit".

"Where third sector organisations are competing with the private sector, I don’t see why their ambitions should be capped," he said. "Often the more interesting solutions can be found in the third sector and in communities, so we want to do more to help them scale up and replicate."

Opposition from Acevo chair

But this idea found little favour with recently-appointed Acevo chair Lesley-Anne Alexander, who spoke after Hurd had departed.

"I am old-fashioned enough to think government has enough to do without helping charities make a profit," she said.

"I’m all for full-cost recovery – which is in jeopardy at the moment – but I’m not sure charities should be expecting a contribution to their overheads. I’ll probably be shot by lots of CEOs for saying this but I don’t think we should be making a profit out of government. We should be compensated for our work but it should be fair on both sides."

‘Get away from initiative-itis’

Hurd also said the Conservatives wanted to "get away from the ‘initiative-itis’ that has bedevilled this government".

"If you had £150m to increase volunteering, would you have created the Experience Corps and v as your sole policy tools?" he asked. "When you look at volunteering, who is making it work – the Met Police and corporations. I’m a big fan of employer-led volunteering. Those more progressive companies who are doing it, like T-Mobile, can see the value in human asset development."

Hurd also mentioned the Conservatives would reform gift aid and reduce the current bureaucracy around funding, but gave no details as to how.

And in response to a questions from RNID chief executive Jackie Ballard about whether he was "hostile, pro or neutral" about large voluntary organisations that have extensive contracts with government, he described himself as "entirely neutral".

“What strikes me about the sector is what a diverse ecosystem it is, and that is the policy challenge, you have to think in the round,” he said. But he was “agnostic” as to whether charities or social enterprises were the better vehicle: “I can see that the desire of all is to help people and improve lives.”

He admitted that his private view was that there are too many charities, but insisted that was for the market to decide, not for government to dictate.

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Directory: Association of Chief Executives of Voluntary Organisations (ACEVO) | Royal National Institute for Deaf People (RNID)
Who's Who: Tania Mason | Nick Hurd | Lesley-Anne Alexander