The trustees of the Society Network Foundation, the Big Society Network charity, have issued a statement denying that the two organisations misused money and used political pressure to secure more than £3m of funding.
“There have been unsubstantiated claims that SNF and BSN used political pressure to secure awards of funding and that money has been misused,” the trustees of the foundation said in the statement today. “The SNF trustees unequivocally reject all such suggestions for which there is no evidence whatsoever.”
The trustees rejected claims that their charity was under investigation by the Charity Commission, which is looking into allegations the foundation used a restricted grant to fund the deficit at the Big Society Network, and is also looking into consultancy fees paid by the charity to its directors.
The Commission said in February this year that it intended to “carry out some further scrutiny” of the charity’s accounts, and confirmed this week that it has opened an operational compliance case – a form of regulatory inquiry. It has also met with the charity’s trustees this week. However it said these actions did not constitute an investigation.
“The Commission’s operations compliance case into the Society Network Foundation remains open and ongoing,” a Commission spokeswoman said in a statement. “The Commission met with the trustees this week.
“We had a frank and open discussion with the trustees about, in particular, a grant received and the monies expended, and other accountancy issues including related party transactions.”
The Society Network Foundation said that it made no unauthorised payments to directors.
"All grant applications complied with the rules"
The trustees also said they complied with all rules in making applications for grants.
The two organisations have been awarded more than £3m from government and lottery sources since they were launched with David Cameron’s backing just after the 2010 election.
Civil Society News ran a series of stories last year questioning irregularities in the grants, leading Gareth Thomas, the then-shadow charities minister, to demand an investigation from the National Audit Office.
As a result the NAO recently published a critical report which said the Cabinet Office overruled its own grantmaking advisors in order to give money to the Big Society Network from the Social Action Fund, despite being told it did not meet the entry requirements.
In addition the Big Lottery Fund recently withdrew a grant to the Society Network Foundation.
Liam Black, a trustee of Nesta, said his charity had been “forced” to fund the Big Society Network, a claim which Nesta has since denied.
Stories about the critical report have since appeared in national newspapers, including the Independent. The Society Network Foundation said it has complained to the Press Complaints Commission about the Independent story.
“The allegation that SNF received favourable treatment because of links to the Prime Minister and the Government is not true,” the trustees said in their statement. “If anything the association with the BSN made it more difficult for SNF to secure funding from private and public funding bodies that make political neutrality an imperative.
“All the bids for funding for the many projects run by the BSN/SNF complied fully with the procedures laid down by each of the grant awarding bodies and none of the trustees are aware of any funding that was granted other than in strict accordance to the criteria laid down by these bodies.
“No credible evidence has been supplied to support media claims that the innovation charity Nesta was ‘forced’ to fund BSN.
“Any allegations that a public body was ‘forced’ to fund an organisation are serious and potentially very damaging to individuals concerned and yet the trustees have received no evidence to support these claims and further note that Nesta have rejected these claims.”
