The recent case of the Salvation Army vs the 700 Club has highlighted an inherent problem with the Big Society plans, warns Niki May Young.

We’re not ready for a Big Society, we don’t even know what it means yet. Not just the throwaway words of a young journalist - but a common sentiment echoed throughout the UK public, from those who have heard of it at least.

One instance more than any other has thrown me into this dissident camp: the case of Darlington’s two charities caring for the homeless - the Salvation Army and relative unknown the 700 Club.

Their names have been circulating the press because of a recent Tupe, or Transfer of Undertakings, ruling which will see the 700 Club responsible for the redundancy pay of 18 Salvation Army staff. After their local council slashed funding for the homeless, the two charities were forced to compete against each other to maintain their services and keep their accommodations open. The Salvation Army lost out, forcing the closure of its Tom Raine Court facility, and the 700 Club now faces a possibly crippling bill of up to £250,000, as estimated by the charity, despite only winning £190,000 in the tender.

There has been much debate over who is to blame in this scenario. The 700 Club’s founder initially accused the Salvation Army of “corporate muscle-flexing” while the council has blamed the 700 Club for not reading the small, or not-so-small, print which stated that Tupe regulations would apply. The Civil Society comments board has been equally divided. Should the 700 Club have even bid under those circumstances?, some have asked. “Most small community groups will not have the expertise or the finances to understand what the implications may be for them or employ the advice of legal counsel,” said one commentator.

But regardless of who is to blame, the case has highlighted a significant issue for the government's flagship localism agenda, which aims to devolve responsibility for the health of local communities to their councils. and the localism theme, as anyone who has been paying attention will know, is a key tenet of the Big Society.

Here is the detail of the Darlington case:

Darlington Borough Council has more than halved funds for the homeless. The two charities were told in order to continue running their services in the area, they must bid for a contract which would provide less funds than either of the charities previously received alone. There was one contract, one charity would have to go. The contract was for £190,000, but Tupe regulations applied, in the case of the 700 Club winning it could mean forking out £250,000 – or in other words an immediate loss of £60,000. Was this a council oversight? – undoubtedly, the alternative is too sinister. Will it be a rare oversight? – unlikely, in my opinion. This is the case of one council, one contract, one service area, before many cuts have even come into effect.

Once the Localism Bill comes into being, councils will be entering a whole new era with all manner of new responsibilities and challenges - not to mention a whole lot less money than they are used to. How do we expect councils inexperienced in the kind of governance they will be responsible for under the Big Society to ensure these kinds of consequences do not occur? We can’t – we’re not ready.