A group of charity umbrella bodies has written to Rob Wilson, minister for civil society, asking for a meeting in the wake of his comments last month that grants are an “unsustainable” form of funding.
The Grants for Good campaign is comprised of the Charity Finance Group, Children England, the Directory of Social Change, the Lloyds Bank Foundation and Navca, the local infrastructure body.
Wilson (pictured) recently told the Charity Finance Group’s annual conference that charities are too reliant on public grants that are “unsustainable in the long term”.
“Too many charities are focused on outdated operating models that are dependent on one or two sources of income, and are just one pay-cheque away from insolvency,” he said.
“Too many charities are relying solely on grants from the public sector, a way of working which is simply unsustainable in the long term. It is vital that we prioritise investing in organisation and development, building stronger leadership and governance. Creating more robust strategic plans and implementing more effective business models.”
The comment prompted criticism from charities. Neil Cleeveley, chief executive of Navca, said the minister was talking “nonsense” and Jay Kennedy, head of policy at the DSC, labelled his behaviour “phenomenally unhelpful”.
The group has now written to Wilson to tell him that grant funding is often “the simplest, quickest and most cost effective way to fund the work of voluntary, community and social enterprise (VCSE) organisations”.
“You may be aware of the final report of the joint review of partnerships and investment in voluntary, community and social enterprise organisations in the health and care sector produced by the Department for Health, NHS England and Public Health England as well as VCSE representatives,” the letter says.
“Recommendation 14 of the report asked for health and care bodies to fund on a ‘simplest-by-default’ basis. This would involve commissioners using the simplest funding mechanism that balances impact and transaction cost, rather trying to apply a one-size-fits-all approach to funding service delivery.
“There is strong evidence to suggest that in many circumstances grant funding is the simplest, quickest and most cost effective way to fund the work of VCSEs.
We would welcome the opportunity to meet with you to discuss how the principle of ‘simplest-by-default’ could be expanded across the public sector and the prospects of research on the value of different funding models.”
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