Funding Public Service Delivery By The Voluntary Sector Briefing for Voluntary Sector Excellence: A joint UK/Finland/Estonia project November 2004
THE NATIONAL AUDIT OFFICE ROLE n To provide independent information, assurance and advice to Parliament on the use of public resources n To help promote better financial management and value for money
UK PUBLIC FUNDING OF VCS n n n 1998 Compact between government and VCS 2002 HM Treasury review ‘The Role of the VCS in Service Delivery’ Since 2002: - HMT – Guidance to Funders, VCS Review 2004 - Home Office – procurement guidance - Compact funding code - Other government departments – VCS strategies and champions - NAO study of progress - OPM - Balance of Risk - ACEVO – full cost recovery, Sure(r) Funding
HM TREASURY REVIEW, 2002 n Funding recommendations (by April 2006) - Full cost recovery – price to reflect full cost, inc overheads - Streamlining access – common access point and application process, ‘passporting’ - End loading of payments – advance payments, balance of risk and profile funding - Stability in the funding relationship
NAO STUDY FINDINGS n n Volume of VCS funding up Progress on funding practices is patchy - Some ‘green shoots’ Some issues cause more difficulty - Full cost recovery - Grants vs contracts Top-level commitment, but ‘trickle-down’ varies - To other funding bodies - Within departments
OTHER WORK n n HM Treasury Guidance to Funders - timing of payments - stability in funding relationship ACEVO - full cost recovery templates - Sure(r) Funding Charity SORP revision - current consultation, including reporting of achievements against objectives and allocation of costs CFDG - positive response to SORP revision - ‘Inputs Matter’ – disclosure of full cost - Review of EU funding end-loading payments
OUR STUDY n n n Focus on funding issues Cross-departmental, Home Office lead Coverage – spending chain, inc local govt Takes SR 2002 as its starting point – focus on implementation A progress report - Increasing volume of work for the VCS - Streamlining application and monitoring - Moving to better funding mechanisms Output – report to Parliament in spring 2005
FIELDWORK n n n n Track many current initiatives and data Contacts through G 3 Champions and VCSLOs Survey of departments, with follow-up Case examples and drill down NCVO - Consultation with the sector - Literature review - International comparisons Key challenges Draft report – end 2004 Other outputs
PROGRESS TO DATE n n n Survey of departments completed - All major funders - NDPBs and agencies - Initial analysis, inc best-practice examples Workshops - Expert groups – full cost recovery, grants vs contracts - Operational issues Oct - Local government funding issues NCVO - Focus groups - Interviews - On-line members’ consultation - Literature review
FINDINGS continued n n n Building funders’ capacity to work with VCS - Variety of measures - Little evidence of dept-wide approaches - Early days - Clear VCS relationship facilitates capacity-building Streamlining application processes - Several examples (2 -stage, online forms, joint portal) - Direct-to-VCS and larger funders more proactive - Frequency of new awards encourages reform - Funding complexity resists standardised applications Payment in advance - Widespread examples - Payment in advance of expenditure (not need) - Challenges – risk, “technology”, “EU rules”
FINDINGS continued (ii) n n n Longer-term funding - Moves to 3 -year funding (away from 1 year or less) - Notable successes - Challenges – programmes which run across Spending Reviews, resources to set up, risk, excluding new suppliers Lighter-touch monitoring and evaluation - Most departments have at least some examples - Extent varies - Approaches vary - Perceived barriers – central guidance, risk Full-cost recovery - Responsibility often delegated - Variety of approaches - Challenges – VCOs’ ability to evaluate costs effectively, under-bidding, public perception of charity overhead levels
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