Memorandum from Turning Point (DCH 24)
Turning Point is a member of the Charities Act
coalition, chaired by NCVO. Turning Point is pleased that NCVO
will be representing the coalition at the oral session of the
Joint Committee next week. We endorse their position in relation
to the Bill.
I would like to use this opportunity to respond
to the question posed by the Joint Committee in relation to whether
the bill would permit the charity and voluntary sector to play
a greater role in the delivery of public services, if they wished
to do so.
Turning Point agrees that there is an urgent
need for legislation to modernise charity law. It will help to
create an environment in which charities can retain public trust
and confidence and be seen to be open and accountable to a range
of stakeholders, including commissioners, private and statutory
providers, the public and users of services. Charity law needs
to be seen to be relevant and effective in order to retain confidence
in the sector as a whole. It is important for government to be
able to nurture and support and development of the sector as a
whole but also to provide the infrastructure support that is necessary
to bring about a greater role for the voluntary sector in the
delivering public services.
The Charities Bill is strong in terms of fulfilling
a supportive role for the sector and by maintaining public trust
in charities, may help to bring about an improvement in cultural
attitudes towards the sector. However, charity reform, in itself,
will not bring about a step change in the delivery of public services
unless accompanied by infrastructure reform.
In common with many other major providers, Turning
Point has long been concerned that there is not a level playing
field in the commissioning and provision of services. The voluntary
sector is nominally included in partnerships at a local level.
However, any theoretical advantage of being at the decision making
table is undermined by the lack of an explicit statement of roles
and powers, (as not all local authorities have developed a local
compact), and a lack of financial muscle by the voluntary sector
that would otherwise allow contracts to be negotiated fairly and
on equal terms with full cost recovery.
These concerns over funding agreements with
the voluntary sector not only have implications for individual
voluntary sector organisations, but also have profound consequences
for the overall shape and well being of the voluntary sector.
The current contractual relations between local government and
the voluntary sector is often characterised by a donor and supplicant
approach rather than a relationship based on genuine collaboration
or working in partnership together to deliver better public services.
For these reasons, Turning Point has argued
campaigning for a standard form of contract between health and
local authorities and the voluntary sector. This would specify
the standard terms and conditions that would form the basis of
any contractual arrangement drawn up with the voluntary sector.
It would seek to build on principles governing the financial relationship
between Government and the voluntary sector, as set out in the
Government's cross cutting review. It would take account of other
precedents that already exist such as the standard contract for
Supporting People services and JCT contracts, which govern the
contracting of both small and large building services in the housing
field.
Turning Point hopes that a standard form of
contract would revolutionise relationships between purchasers
and service delivery organisations in two ways:
First, it would enable both parties to focus
more on the actual frontline service rather than the legal framework
within which that service is going to be delivered.
Second, if services are delivered within a clearer
and more standardised framework, it will make it easier to monitor
and make comparisons between service delivery agencies as regards
their impact on an individual or group. It would mean the sector
is scrutinised more closely in terms of price, standards of delivery
and quality of outcomes for the user.
The Charities Bill has some provision which
will extend powers to spend capital, including larger charities
to spend permanent endowment funds. Currently, the sector is not
seen as a good risk in accessing wider capital because of the
short- term nature of contracts and because it cannot always achieve
full cost recovery under existing contracts. However, a wider
Voluntary Finance Initiative could allow for the sector to invest
in large-scale capital projects and free voluntary organisations
from the short-term, time-intensive system of grants that currently
dominates.
For example, the capital costs of establishing
residential care and support for people with severe learning disabilities
or mental health problems could be borrowed against a long-term
(10 or 25-year) contract to provide that care. The property would
then be owned by the charity rather than a private provider (who
would be free to charge higher rents, given the specialist requirements
of the building) and could be borrowed against to build further
projects, ploughing funds back into service provision. Innovations
like the Futurebuilders Fund provide a great opportunity for a
new deal between government and voluntary service providers and
should be built on to allow the sector to access new forms of
finance.
In conclusion, the Bill could create the impetus
for wider structural changes. It could therefore have a significant
impact on enabling the voluntary sector to play a central role
in the delivery of public services.
Victor Adebowale
Chief Executive
June 2004
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