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Etherington fears emergence of 'fourth sector'

Sir Stuart Etherington, CEO, NCVO
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Etherington fears emergence of 'fourth sector'3

Governance | Jonathan Last | 14 Feb 2012

Sir Stuart Etherington is concerned that the delivery of public services may eventually be limited to only a small number of large-scale providers, effectively creating a ‘fourth sector’.

Delivering his speech ‘The Future of Civil Society’ at York University last week, the NCVO CEO said that a consequence of large statutory contracts which involve sub-contractors and depend on competition could be that public service delivery will be limited to a small number of large-scale providers, with user involvement tokenistic – and that charities will be exploited by larger players.

He also outlined his fears that smaller charities are often not web-savvy enough to cope with modern technical demands, that dissent was being marginalised since advocacy is becoming increasingly hard to find, and that giving and philanthropy are too focused towards the wealthiest individuals, creating implications for democracy and accountability.

Sir Stuart also reiterated the widespread concern in the sector over the damaging effect of the government’s inconsistent messaging on the Big Society, as well as the perception amongst some that “the Big Society presents an agenda for a negative squeeze on funding combined with an increase in demand for services in the voluntary sector”.

It was not all doom and gloom, however, as Sir Stuart counteracted his more negative foreshadowing by stating that there are still grounds for optimism. “Government policy towards the sector remains supportive: there is a real desire amongst policy-makers to strengthen our culture of giving and philanthropy,” he said. “And it is worth mentioning that this is a resilient culture, one that has not been easily shaken by recessions in the past.”

He continued: “Government is also trying to stimulate the social finance market, both in terms of the supply side and the demand side. So, incremental changes to tax and regulation will, I hope, increase the flow of social capital into the sector, whilst support for voluntary organisations to be investment ready will help us engage with this agenda.”

Sir Stuart also believes that there is a genuine commitment on the part of government to open up public services that will involve users and in turn create opportunities for the sector to transform those services, both from the user experience perspective and from the taxpayers’ perspective.

Paul Edwards
Community Development Worker
N/A
16 Feb 2012

I long-ago foresaw the possibility of the rise of a fourth sector. Even under New Labour, there were straws in the wind about contracting for social welfare provision becoming the preserve of the big, corporatist, well-funded voluntary sector organisations and with smaller VCOs being marginalised and even more poorly funded as a consequence.

Now, the sector is wide open to big multi-nationals as well. I recently came across the case of a County Council contracting with a high-tech, multi-national company that that is heavily into the defence and mining industries, to provide, of all things, community advice on sustainable travel. You have ask what real adherence such a company would have to the principles of sustainable travel and what dedicated and experienced voluntary sector green transport organisations missed out on the contract.

Jeff Mowatt
Director
People-Centered Economic Development
15 Feb 2012

The social business approach we operate has been described elsewhere as a 'Fourth Sector'. In our case a small business.

Experience teaches that Sir Stuart is right in that in spite of our efforts we have more than once been brushed aside by larger corporate entities whose social credentials are unproven.

Peter Maple
Course Director MSc Management in Civil Society (Marketing and Fundraising)
LSBU
15 Feb 2012

Stuart is absolutely right to highlight the dangers of current government policy that will allow a small number of for profit companies to dominate the provision of public service which were previously the baliwick of smaller, innovative charities focussing, not on profit, but on delivering the best possible services and outcomes for beneficiaries.

What's worse is the cognative dissonance being shown by the coalition, in supposedly promoting and encouraging "the big society" whilst retreating from and slashing the funding for such services. The reality is that we have a big society which needs investment. As it is we'll finish up with a smaller society which will penalize those least able to speak up and complain.

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