The Office for Civil Society will scrap the strategic partners programme and create a £9m transition fund lasting till 2014 for up to 15 existing strategic partners.

Minister for civil society Nick Hurd defended the move to Civil Society today and described the existing strategic partner programme as "frankly ludicrous":

"I had inherited a situation where I had more strategic partners than civil servants," he said. "We were spending huge amounts of money with very little rigour about what we were getting for it.

"At a time when frontline organisations are suffering cuts we need to be extremely careful about how we prioritise our resources."

Strategic partners were told about the latest update in letters from the minister this morning.  The organisations need to apply for their grants by 25 February 2011 and successful applicants will be announced on 22 March 2011.

The government had already announced plans last year to reduce the numbers of strategic partners from 40 to a maximum of 15 and make sure that no organisation would receive more than 25 per cent of its funding from the Office for Civil Society (OCS), with maximum grants amounting to £500,000 per year.

Hurd said that organisations most likely to attract the maximum grant were those in the process of merging or establishing formal partnerships with other organisations.

Two strategic partners have already merged this year; bassac and the Development Trusts Association have joined to form Locality. 

But some strategic partners are also closing. Youth Action Network, which received 15 per cent of its £1m income from the OCS, announced its impending closure last month.

The charity, which got 50 per cent of its funding from government sources, will cease operating in September 2011 and hand over its assets and members to the National Council for Voluntary Youth Services.

Sector reactions

Seb Elsworth, director of policy at Acevo, said the government’s decision was disappointing:

“It is clearly disappointing that historic support for the sector will be disappearing.

“We will be talking to the OCS and other strategic partners. Those likely to attract the maximum grant are organisations which focus on partnerships and mergers. We have no plans to merge, but we have had many formal partnerships with strategic partners and others in the past.”

Elsworth added that mergers were complex and would take longer than the three-week application deadline.

Vandna Gohil, director at Voice4Change, which received £269,233 in strategic partner funding in 2009, said she was concerned that the government's preference for organisations merging or collaborating would disadvantage smaller strategic partners:

"The government's grant cap of £500,000 and percentage cap on funding gives smaller organisations, especially in the BME and equalities sector, a stronger requirement to merge or form partnerships. These are not a bad thing but it needs to be genuine and considered carefully."

She also said the move would impact the Big Society agenda:

"Post 2014 I have concerns about how the government will get strategic guidance on its Big Society plans."

Hurd: Partners should not be surprised

Hurd however insisted today that the news would not have come as a surprise to partners as they were given a "clear steer" of the government's intent in a letter in July.  

He said the strategic partners were well aware since the summer that the government wanted to reduce duplication of roles and would look favourably upon those bodies that sought mergers or collaboration.