The government has seriously undermined the independence of the charity sector over the past 12 months, warns the Independence Panel in a new report out today.
The panel, a watchdog of senior charity experts, including Charity Finance editor Andrew Hind, are assessing the independence of the sector over a five-year period.
Its second report released today concludes that the independence of the voluntary sector is under serious threat, especially from government.
The report says that the government has imposed contractual gagging orders on some charities, stopping them speaking out about government policies or publicly releasing data and has advised local authorities not to fund certain campaigning charities.
Last month, the Department of Communities and Local Government issued guidance to local authorities advising them to stop funding so-called “fake charities” that “lobby and call for more state regulation and more state funding”.
The report also found that government commitment to the Compact is poor, with non-compliance widespread and monitoring by central government lacking.
Sir Roger Singleton (pictured), chair of the Independence Panel, said: “Our investigations show that in the past 12 months, the government has directly threatened that independence, requiring some charities which carry out work for government departments to toe the government line.
“The government has also failed to live up to its own commitments in the Compact, in which it promises to defend the independence of UK charities.
“Central and local government funding cuts are fuelling the problem. With less money available, charities are less willing to criticise government actions to protect their survival. Some charities are ‘self-editing’ in order to keep on providing services."
Hurd says sector has independent voice
Minister for civil society Nick Hurd was on BBC Radio 4 this morning to respond to the report. He insisted that the sector had not lost its voice and was free to speak out about government contracts such as the Work Programme.
He added that parallel research from the Third Sector Research Centre found that the independence of the charity sector was being maintained despite the weight of government funding.
The research, Is the third sector being overwhelmed by the state and market?, found that the charitable sector is not being overly manipulated by the state and are able to strategically engage without eroding their identity.
However, Heather Buckingham and James Rees who co-authored the report said while it shows that the majority of charity sector organisations receive little or no money from the state, and therefore it would be wrong to suggest that the whole sector's independence is being compromised.
They say their research also shows that a relatively small number of very large charity sector organisations rely heavily on state revenue.
"Our research paper does highlight specific concerns associated with this, in terms of ability to innovate, relationships between charities and effect on social mission. Our research on the work programme also highlights similar concerns to the independence panel about the ability of charities to speak out against government contracts."
Umbrella bodies respond
Ralph Michell, director of policy at Acevo said government needed to stamp out attempts by public bodies to gag charities. But he added: “We need to be clear that that is the answer, rather than charities withdrawing from working in partnership with the state. The solution is better commissioning, not glorious isolation.”
Deputy CEO of NCVO Ben Kernighan said the Independence Panel’s report was a welcome contribution to the debate: “It’s right that we keep a close eye on relationships between charities and the state,” he said.
“The panel rightly highlighted gagging clauses as an area of tension. This is something our members expressed deep concern about in Work Programme contracts. We’re pleased the government has now clarified the intention of these clauses but we continue to watch the issue closely."
Compact Voice manager Tom Elkins said: "The report, like our own findings, suggests that while support for the Compact remains high both locally and nationally, there are concerns around its implementation, with greater efforts needing to be made to ensure activities and engagement with the voluntary sector are reported and shared.
Over the next 12 months, the Independence Panel has recommended that the sector aim to identify what makes the sector distinctive and independent and build a consensus on what would be best to protect it.
It also calls on the Cabinet Office to produce an annual report on national compliance with the Compact to mirror the local review by Compact Voice and says sufficient funding should be available to the Charity Commission to promote independence.
