Conclusions and recommendations
1. The Department does not require grant-makers
to report their costs against a common set of measures and has
done little to encourage grant-makers to compare the costs of
their grant programmes.
The Department should take the lead in agreeing with grant-makers
ways to measure and report the cost of making grants on a like-for-like
basis. Where there is evidence of inefficiency, it should challenge
them to identify the main drivers of cost and to find ways to
make savings.
2. In 2006-07, the Arts Council England spent
35 pence to award a pound of grant to individual artists on its
Grants for the Arts programme, compared to a
cost of between 3 and 8 pence for the other grant programmes we
examined. The Arts Council commits
significant resources to supporting the work of individual artists,
but does not know exactly how much this work costs. It should:
· identify
separately the cost of the development work it carries out with
applicants, and evaluate whether the cost of such work is proportionate
to the outcomes delivered; and
· assess
whether the purely administrative cost of making these grants
is in line with that of other programmes and, if it is not, seek
to learn from other grant-makers to see how its processes might
be streamlined.
3. On average, English Heritage spent nearly
£10,000 to award a grant under its Repair Grants for
Places of Worship scheme, and estimates that providing
technical support, such as from surveyors and architects, to grant
applicants, represents over half of the cost incurred.
English Heritage should keep under review the cost of awarding
these grants and should identify separately the cost of providing
specialist technical support. It should seek ways to reduce this
cost, such as by introducing a risk-based approach which ensures
that the level of specialist support, in particular the input
of architects, is commensurate with the demands of each project.
4. Applying for a grant can be a complex and
time-consuming process but grant-makers do not seek to understand
what costs their processes are imposing on applicants.
For Big Lottery Fund's Reaching Communities programme,
applicants took on average 21 days to prepare an application,
although the application had a one in five chance of being successful.
Grant-makers should routinely monitor how much it costs applicants
to complete the forms and provide the information necessary to
apply for funding. Wherever possible they should make it easier
to apply for grants by simplifying application forms, by improving
guidance and access to advice, and by requesting only the information
they need to make funding decisions.
5. The Big Lottery Fund has increased the
spread of successful applications across the United Kingdom and
from different social groups, but more could be done by other
grant-makers to raise potential grant applicants' awareness of
available funding and to stimulate higher quality applications.
Grant-makers should seek to learn from Big Lottery Fund's approach,
including its regional outreach operations. They should work together
in the regions, and with other partners such as local authorities,
to establish one-stop shops and run events to promote grant programmes
and offer advice.
6. There is little effective sharing of information
on the costs and processes of grant-making. The
Department should facilitate an initiative across the sector to
share information about the administrative costs of grant programmes.
It should:
- work with the Lottery Forum
to develop its role in sharing good practice and compare the costs
and effectiveness of the grant-making process; and
- promote the exchange of information and learning
about good practice, both within and beyond the sector, for example,
by helping grant-makers set up a benchmarking club.
7. Despite recommendations made by this Committee
that they should work together, grant-makers have worked independently
to rationalise office accommodation and identify efficiency savings.
The sector has made little progress in sharing services, systems
or accommodation and the Department should be more pro-active
in encouraging sharing and co-operation between bodies in the
sector in areas such as office accommodation. It should require
those grant-makers with a regional presence to evaluate the costs
and benefits of sharing office accommodation and facilities.
8. Grant-makers have procured and developed
independently their own IT systems to manage grants and have done
little to share information about each system's strengths and
weaknesses. This approach is symptomatic
of an apparent unwillingness to work together. The Department
should promote closer working between the grant-makers in researching,
testing, procuring and developing new systems. Before approving
funding for new IT systems, it should require an evaluation of
the scope to share or adapt systems already in use by other grant-makers.
9. Only Sport England of the four grant-makers
has the ability to process applications online, even though such
an approach can reduce the costs of their processes, simplify
the grant application process and improve the grant applicants'
experience of the process. Grant-makers
should work together to explore how to increase the use of online
applications in their processes. As a starting point, the development
work being carried out by the Big Lottery Fund to introduce online
applications should be shared with others.
10. The lottery distributors have established
a common website which refers applicants to the distributor most
relevant to their circumstances, but grant-makers have yet to
establish a one stop shop for grant applications, as exists in
the United States. In the United States,
a common website, which is shared by 26 Federal grant-making organisations,
lets applicants know about grant opportunities and enables them
to submit applications on-line. The Department should encourage
grant-makers to work together to make better use of technology,
such as by developing a shared grant application system similar
to that in the USA.
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