The charity membership body for Scotland has said the country’s funding system is not fit for purpose and warned that organisations risk closure without change.
An unstable, competitive and overly bureaucratic funding system were among key problems outlined by the Scottish Council for Voluntary Organisations (SCVO).
SCVO this week published parts one and two of its Pulse report, based on focus groups with 12 charities, which identifies a sector under “growing and increased pressure”.
Commenting on the research, SCVO chief executive Anna Fowlie urged first minister John Swinney to speed up the grantmaking process for projects that include health, education and poverty.
“Taking action to address these deep-seated issues is long overdue,” Fowlie said.
“As a starting point, that must include delivering fair funding and creating a new model of partnership with the sector.”
This comes amid a multi-year “fair funding” pilot from the Scottish government of 51 grants totalling £130 over 2025-26 and 2026-27, launched last April.
In February this year, Swinney’s government announced it would develop a third sector partnership guided by principles in SCVO’s manifesto such as allowing charities to better influence policy.
But Fowlie said these partnerships are not yet working.
“Voluntary organisations face a funding system that isn’t fit for purpose and partnerships with the public sector that are too often weak,” she said.
“This comes against a backdrop of financial insecurity and rising demand, creating significant pressure on the voluntary sector workforce.
“Without change, the risk is clear: the voluntary organisations communities across Scotland rely on […] will be pushed beyond breaking point.”
Fairer funding pledge
In February, Shirley-Anne Somerville, social justice secretary, said the Scottish government was committed to developing an agreement with the charity sector.
"This partnership will put our relationship with the third sector on a clear, principled footing,” she said.
“It builds on our commitment to fairer funding and signals that we value the sector as an essential delivery partner and as an independent, strong voice.”
The Scottish budget also committed £20m to charity partners for community initiatives in January this year.
