Press Story

Local people who rely on the help and support of neighbourhood charities face being left out in the cold as Big Society money is ring fenced for charities to deliver public services, according to a new report published today by the think tank IPPR North.

The report calls for Big Society Capital funding to be reserved for small community groups and says local authorities should encourage donations to local causes from local people - including utilising schemes run by supermarkets like ASDA and Waitrose whereby customers can donate when doing their shopping.

Other recommendations to raise revenue locally include adding discretional charges to restaurant bills meaning people can pay for a dinner for two and donate to the local youth club at the same time.

Small voluntary organisations - like youth clubs and support groups - can be the foundations of a community and tackle the emerging problems faced by the neighbourhood.

But funding from the public sector will focus on commissioning services locally as opposed to providing grants for charities that are tackling specific issues.

The report argues that community groups are being hit by a triple whammy of changes to the shape of the civil society:

Public sector grants have been squeezed from £5.3bn in 2003/4 to just £3bn in 2009/10
Smaller community groups are not well placed to compete with private sector companies and larger voluntary organisations for public sector contracts
Government 'Big Society' programmes and funding initiatives such as Big Society Capital are not well tailored to the needs of small groups

IPPR North's new analysis of the National Survey of Charitable and Social Enterprises (NSCSE) has found that out of 28,000 small community groups with a turnover of less than £60,000, fewer than 2 per cent are to be found in the poorest 10 per cent of deprived neighbourhoods. Of those that are, they are almost twice as likely to be in receipt of statutory funding and so most vulnerable to cuts.

Ed Cox, Director of IPPR North, said:

"We know that small community groups play a vital role in supporting the social and economic health of poor neighbourhoods - they're the youth clubs giving young people places to go and support groups for people going through a difficult time in their lives. Yet it is these organisations that are being hit hardest in the areas that desperately need their support. Where richer communities are better able to rely on volunteers and local philanthropy to see them through this lean period, the so-called big society finds it harder to survive in the communities that need it most. This survey is just the tip of the ice-berg as there could be as many as half-a-million small organisations not captured in the statistics."

IPPR North recommends a number of urgent measures to redress the situation including:

National and local government should provide a grants programme for community groups that respond to neighbourhood need and a process of applying for funding that isn't bogged down with red tape.
A proportion of Big Society Capital's funding should be for new 'microfinance' products targeted at small community groups.
Public sector commissioners need to be aware of the potential of the Social Value Act to empower small community groups when it becomes statute this month.

Notes to Editors

IPPR's new report - Taken for Granted: the needs of small voluntary and community organisations in the big society era - will be available from: http://bit.ly/IPPR10085

Contact

Emma Brennan, 020 7470 6122

Tim Finch, 07595 920899, t.finch@ippr.org