In a 2014 briefing paper, NPC’s then-director of development Tris Lumley predicted that in the future, federated structures could play a pivotal role in answering key questions about the role of charities.
Lumley argued that they could be an alternative to “the polarised choices of small and local or national influence”, which he said were responsible for many of the big challenges facing charities.
“Federations may just hold the answer (if they can tackle their inherent challenges) to how to marry the bottom-up approach that so many in the charity sector yearn for with the top-down structure that they also need,” he wrote.
According to the Charity Commission’s latest annual return analysis report, for 2024, one in 10 charities is part of a federated structure.
The report shows that 13% of larger charities (income above £500,000) are part of such a structure compared to just 2% of those smaller.
Increased collaboration
Established in 1946 as the National Association for Mental Health, today Mind is one of the most well-known federations in England and Wales.
The mental health charity oversees 96 local Mind charities across England and Wales, whose services differ based on what local people need.
Alongside its national services, research and advocacy, the central body funds and scales up the most impactful grassroots mental health support initiatives across the federation.
There has been a lot of consolidation across the network in the last few years, with some local Minds seeking economies of scale and merging with each other.
According to its accounts, the number of local Minds in England and Wales has decreased gradually from the 121 it had in 2019-20.
Aidan Mersh, associate director of federation services and support at Mind, says some of the mergers reflected a change in how local mental health services are commissioned.
For instance, Mersh says the Mind network had to respond to NHS England’s recent decision to group and merge its 42 integrated care boards into 26 clusters.
“Part of what we’re trying to do isn’t just providing services, but also making sure that all services – whether we or the NHS or others provide them – are accessible and reflect the needs of the communities and our quality. Part of that is having strong relationships with those commissioners.”
He says local Minds have had to collaborate more over the last decade, which has resulted in them becoming more sustainable and helping more beneficiaries (664,000 people supported in 2024-25 compared with 555,000 the previous year).
Sharing expertise
Similarly, family support charity Home-Start UK (HSUK), set up in 1973, is a national body at the centre of a federated network of 167 local charities, down from 174 in 2024-25.
HSUK provides guidance, learning opportunities and resources to the local Home-Starts to help them deliver services.
For instance, it delivers a quality assurance (QA) programme, a set of bespoke standards and the system by which it evaluates the compliance of the network with its quality obligations.
HSUK’s co-chief executive Natalie Acton says: “We’ve got a robust review programme, so that we make sure we uphold high standards in terms of local government, operations, safeguarding and family practice, which means that our local charities can be confident they’re always up to date with best practice without having to do their own research.
“Local Home-Starts tell us that they find our QA programme helpful when bidding for funding, because – particularly to statutory funders – they’re able to say: ‘We’re subject to a robust QA programme each year.’
“We also do practice development, so we enable peer learning and scale network innovation. If there’s a good idea in one part of the network, we make sure that we can scale it across all 167 charities.”
HSUK provides preparatory training for all Home-Start volunteers, offers crisis support and manages the branding for its network.
Acton says the central charity also offers strategic leadership.
“We do data monitoring and respond to risks and opportunities in the network. Where there are issues like local government reorganisation, we’re able to gather expertise to make sure that people across our network are up to speed with those sorts of issues.”
Tension between localism and autonomy
In its sector-wide risk assessment report last year, the commission noted that it had observed specific issues related to federated charities.
These include the potential for disputes within federations and challenges for parent charities in overseeing the effective implementation of policies within their branches.
A recent example of this is SOS Children’s Village UK’s decision to split from its international federation over a clash in values.
The UK charity explained that the structures it had been operating under as part of the group were “no longer best placed to serve our work, the direction we want to take in the future, and ultimately the children and young people we’re here for”.
Meanwhile, in a 2023 report, Sheffield Hallam University concluded that economic pressures were challenging federations’ traditional operating model, raising questions of consolidation, rationalisation and other forms of collaboration.
In addition, the researchers said federations faced other challenges such as a lack of visibility and wider understanding of what they do.
Federations are complex organisations that have to manage tensions created by contradictory pressures around alignment and autonomy, which need ongoing attention.
At HSUK, Acton concedes that there is a continual tension between local charities’ autonomy and a need to drive consistency to meet national guidelines.
“We always try to make sure that we have clear, concrete standards on issues like safeguarding and governance.
“But we have a lot of local flexibility to respond to local need in terms of how services are adapting.
“It’s just a tension that all federations have to manage, and I think that over the years, Home-Start has managed that very well.”
‘It makes it less lonely’
Nevertheless, Acton says the federated model offers plenty of benefits.
From a central body’s perspective, she says it is “brilliant” to have access to local information and insight into what is happening on the ground.
When HSUK talks to government ministers, it can give localised examples.
She recalls that when violent riots broke out in June in Northern Ireland, HSUK was immediately in touch with its local Home-Starts in Belfast.
“They’d already been into the homes of some of the families they support there, because the families were scared to go out, and they were able to convey to us what it’s like bringing up a young family in that context.”
She says running a local charity right now is tough and that she is continually impressed by the CEOs of the local Home-Starts who often act as one-person teams.
Being part of a federation offers moral support to local CEOs, whose roles can be lonely, and practical help such as admin, she says.
“Our training and QA programme are always current. We’re able to do a scan of the horizon and be aware of upcoming policy issues, changes in government, governance, those sorts of things.
“Some of the things that can take a lot of time, like choosing and commissioning an insurance broker, we do that for them. We take a lot of the load off them, enabling them to focus on that frontline delivery.”
For Mersh, the main benefit of Mind’s federated model is the agility it gives its services.
“When we talk about the public need across nations at high level, what we can get is good insight into lived experience from these communities and their needs, which can be very different, whether it’s rural or urban.
“There’s also an economic benefit, pride in place and a strong link to communities.”
Like Acton, he too believes that being part of a federation means not having to do things on your own.
“You’re not having to reinvent the wheel,” he says.
“You’ve got access to support and trusted colleagues who you can have honest conversations with, who will help you and have the same values as you.”
What is next for the model?
Both Acton and Mersh say that the federated model is an asset for charities responding to changes in their operating environment.
Acton says: “Both in terms of family need and the structure of the charitable sector, we feel like it’s an idea whose time has come because it’s so difficult to run a small local charity.
“The environment is competitive and the requirements on charities, in terms of their legal, regulatory requirements and as employers, have become even more complex.
“If you can have that backstop of a central body doing a lot of that stuff that doesn’t need to be done locally, then it’s just very helpful. We spend a lot of time trying to work out what’s sensibly done at a national and local level and in between.”
Mersh says the key to the federated model – which he thinks is “possibly the best way of thriving” – is ever-closer union and collaboration.
He gives the example of the Mind federation looking at AI and what it means for mental health and service delivery, so that it would do it once together instead of separately for each local charity.
“We’re always getting better, knowing what the models are out there around services and how we share them,” he says.
“The consolidation of member organisations will continue.
“What that means is we’ve got economies of scale, but still work in communities and reflect boroughs, local authorities and NHS trusts.”
