The founder of a London-based social enterprise has told MPs that the “competitive” way the government awards contracts is “soul destroying” because it pits organisations that should be working together against each other.
Speaking to MPs from the All Party Parliamentary Group for London on Wednesday, Simon Boyle, founder of the Beyond Food Foundation social enterprise, called on parliamentarians to “stop the competitive contracting of funding”.
Boyle, whose social enterprise focuses on helping people who have experienced, or are at risk of, homelessness to gain employment, said applying for contracts took up “too much time and too much money” and meant that, instead of working with other local charities and social enterprises, there was an adversarial element.
“Stop the competitive contracting of funding. Over the last couple of years we’ve spent so much time applying for grants and social investment and we’re up against the people we’re trying to work with. We’re spending too much time on it, it costs us too much money and, frankly, we lose way more than we ever gain from it. And it’s soul destroying.”
Boyle said instead of putting contracts out to tender, the government should instead take a more granular view of the sector, focusing on and funding specific organisations in specific areas, rather than “wasting everyone’s time”.
“Recognise who the organisations are that are doing what you want to do. Go and find them and fund them, rather than wasting everyone’s time.”
He also said that the government needs to recognise that “in the same way that every good chef can’t necessarily run a successful restaurant” so it must recognise that “not all charities can run social enterprises”.
“Not all charities can run social enterprises. At the moment charities which can’t fund themselves, because it’s a very difficult economic climate, so they turn to being a social business. It’s not as easy as that, you need to get the right people on board to do it.”
Contract funding ‘big problem’ for small charities
Also speaking to MPs, Alison Gowman, chair of the City Bridge Trust Committee, said that contract funding was “a real area of problem for some of the smaller charities, who can’t always respond to big commissioning contracts.”
She said contract funding encouraged larger, non-area-specific charities and social enterprises with bigger budgets to muscle out smaller organisations. She said there needed to be a funding model whereby smaller organisations can get a “fair share”.
James Banks, director of London Funders, said the voluntary sector in London employs over 250,000 people in the capital, and provides services to over seven million Londoners every year. He said it is a “huge sector, but it is also a sector which is under huge pressure”.
He said London Funders were seeing a “higher and more complex needs at a local level; growing demand for support, often less funding to meet those needs and an expectation that volunteers will spring into action to address some of those key services”.
He also said the “contract culture” was “pushing risk onto smaller, community groups at a time when they’re already under pressure and when the infrastructure that allows them to flourish is also under pressure”.