Ros in the Lords - Stronger Charities for a Stronger Society (Charities Committee Report)

As you might expect, Ros has been keeping busy since standing down as Chair of the House of Lords EU Sub-Committee on Energy and Environment, and as part of that, served on an ad-hoc Committee on Charities, chaired by Baroness Pitkeathley.

Whilst the charitable sector responded almost immediately to the findings of the report, the Government was rather slower to come up with a reply, leading to a lengthy delay in debating the subject. Ros was keen to take the opportunity to talk about some of the things happening here in Suffolk...

My Lords, I start by drawing the attention of the House to my relevant interests as set out in the register, particularly as a trustee of Community Action Suffolk and a member of the advisory board of the NCVO. It is a pleasure to participate in today’s debate, and to be able to do so having had to wait such a long time for the Government to respond. In contrast, the ink had barely dried on our report before the sector nationally began deciding how best to implement the recommendations. 

During 2015 and 2016, the charity sector came under intense scrutiny as a result of the fundraising issues brought to light after the death of Olive Cooke, the collapse of Kids Company and the introduction of new rules on lobbying. My strong feeling is that, during that time, both government and Parliament got the tone wrong. Of course it was right to expect a serious response from the sector to these problems, and for it to learn from them and prevent them happening again. However, there were times when the dialogue was over-confrontational and left the whole sector feeling as though it was taking the blame for the problems caused by a few. Dialogue should be robust, yes, but not confrontational, and it should be respectful of the amazing job that charity groups do in our society. 

I am pleased that the committee decided to focus on the needs of smaller charities: 167,000 registered charities have incomes under £100,000 a year and they make up three out of every four charities. While many of our recommendations and conclusions apply equally to charities of all size, the real difference is the capacity of smaller charities to make the changes that they need to in order to thrive in an increasingly challenging environment. We pondered whether there are just too many small charities, although I do not subscribe to that view. The whole sector is about service—people spot a need and they try to fill it, often showing ​immense passion, commitment and dedication to do so. That is what makes the charity sector so wonderful, so vibrant and so inspiring. 

I agree that new charities should be encouraged to take a long, hard look at whether someone else is doing similar work, and the point of application to the Charity Commission is a useful reminder to do so. I also agree that trustees should be encouraged to regularly review whether the original need still exists and, crucially, whether they are meeting it. I welcome the Charity Commission’s commitment to look further at its guidance on mergers and the need to make winding-up charities more straightforward. 

On the whole, however, I would prefer to see emphasis on support for small charities to deal with the major issues that face them; namely governance, regulatory compliance and operational effectiveness, including fundraising and digital skills. This is where the infrastructure bodies come in, and I am keen to ensure that local infrastructure bodies are encouraged. They can provide support to small charities in a way which is tailored to local need and perceived by stakeholders as relevant, affordable and more easily accessed than London-based provision. The overwhelming evidence we received was that smaller charities struggle to access the advice, guidance and training that they need. Yet a quick glance at our report shows that over 25 organisations gave evidence on who might provide such help and support. When you add in the local and sectoral bodies, it seems to me that the problem is less about the amount of advice and support that is available and more about how to access it. So I strongly urge Members to support our recommendation 67, which urges the sector to look more closely at how advice is signposted. 

Community Action Suffolk was founded in 2013 and was a coming together of 10 community groups in the county, many of which were struggling. Coming together has provided a better scale for good delivery, better value for money and, above all, a stronger voice in the county and more leverage in creating local partnerships. The inevitable pain and compromise of merger has proved very worth while.

As we highlight in our report, trustees are the key to good governance, but in small charities focused on and motivated by their wish to deliver their own objectives they are often seen as more of a legal nicety than as integral to the success of the organisation. Trustee boards often lack diversity, not just in gender and ethnicity but in background. Legal, financial and digital skills are often absent, and failing to look for trustees outside the charity sector runs the risk of boards losing or not having the right skills mix to be fully effective. Regular skills audits can be very powerful and larger charities should hold genuine open recruitment.

This is one of the areas where government can make a difference, promoting trusteeship both within its own workforce and to business. I should like to see the Government consult on statutory time off for trustees, which would be of great practical help and would send out a powerful message about the value of being a trustee.

Because I have not mentioned Suffolk for at least a minute, I should like to highlight the Suffolk young trustee programme. This will give young people a ​shadow trustee role initially, along with a mentor and appropriate training, to give them a taste of the work of being a trustee. We hope it will encourage voluntary organisations to welcome young trustees and young people to come forward. It is not only commendable from a diversity perspective but could help to promote the digital understanding that so many trustee boards lack.

Noble Lords will have picked up by now that I am a fan of infrastructure bodies, particularly local ones, but they cannot run on fresh air. They face a real conundrum because charging at even a modest level acts as a barrier to smaller charities getting the support they need the most. There is a reluctance from donors, stakeholders and commissioners to cover the core costs of charities, particularly governance costs. 

We have heard evidence that the relationship between local government and charities is not always a positive one, despite the fact that their work should be complementary. This is something that government at local and national level needs to address. Perhaps the new regional devolution settlements will provide such an opportunity, but this requires real partnership working between government at all levels and the sector, which we have failed to see so far.

@BaronessRos in the Lords - Queen's Speech Debate, Day 4

Day 4 of the debate on the Gracious Speech, as the Queen's Speech is referred to in the Lords, saw attention turn to proposals on home, legal, constitutional and devolved affairs. Ros wanted to address the contradiction between the will to devolve significant areas of civic life to the voluntary sector, and the means supplied...

Like my noble friend Lady Barker, I will speak on the relationship between the Government and the charity sector. It is worth starting with the reflection that charities contribute around £12.2 billion to the UK economy and that on top of the millions of people who volunteer on a regular basis around 827,000 people are actually employed in the sector, which is about 3% of the total workforce of the UK. The relationship between the Government and the charity sector is an important one that the Government should take care to get right. All too often we see a lack of understanding in Westminster and Whitehall about the way the sector works, and a tendency to impose change rather than work with it.

The gracious Speech contained reference to a new statutory framework to be set up to deliver the National Citizen Service. I urge the Government to work very closely with the sector on this, because it will not be easy to get it right. Charities cannot just absorb large quantities of volunteers—they need professional staff to train and manage them. In fact, many charities do not lend themselves to the way the NCS will operate. We want volunteering to be a positive experience. That means that we need to take care to match the individual and the organisation. Local volunteers’ centres can be brilliant at doing this, but they have been closing fast due to funding cuts. The whole point of the big society is that it works best when it is small.

Lately, we have seen from government a strategy of announcement, furore and then withdrawal: the PIP changes announced and dropped, outcry at the anti-advocacy clause, and now sending elements of housing benefit reform back to review. Members have marched through the Lobbies, Conservative MPs go on the airwaves to defend the indefensible, and then the Government change their mind. I am not going to lose sleep over the difficulties that that causes for the Conservative Party, but what troubles me is what it says about the Government’s attitude to the voluntary sector.

Coming back to the anti-advocacy clause, Answers to Written Questions from my noble friend Lady Barker show that the Government could offer no evidence of the use of government grants to fund lobbying activities. I know that it is radical, and perhaps I am naive to expect evidence-based policy, but really—no evidence? Do not get me wrong: charities should be scrutinised and appropriately regulated, but the Government should not give the impression that problems exist where they do not. The damage to the sector in the long term will harm all of us.

The governance of charities is in the spotlight more than it has ever been. That is only right. Regardless of whether charities’ income comes from taxpayers through the award of contracts, or from the philanthropy of individuals currently giving around £19 billion a year, they have a right to expect good standards of governance. The NCVO has done a good job in responding to issues such as inappropriate fund raising, while the collapse of Kids Company demonstrates that no matter how good the cause, or how charismatic the leader, not only do trustees have to take their responsibilities seriously but public bodies need to do more to assure themselves that the standards of governance of those to whom they award contracts is in good order.

Traditionally, charities funded their work through donations and grants. That is still the perception. However, over the last decade that has transformed. Charities earn more of their income—55 pence out of every pound in income now comes from providing services or from trading. There are around 163,000 charities in the UK, with a total income approaching £44 billion. Around £15 billion of that comes from working with government. This was increasing between 2000 and 2010, driven by the voluntary sector delivering more contracts. However, as public spending has reduced, charities are now receiving less.

The last time I spoke about this issue in your Lordships’ House two years ago I expressed my concerns about public commissioning and procurement practices. They tend to be focused more on the way the private sector works and do not tend to favour small local enterprises of any kind. I ask the Minister to ask the Commissioning Academy to take more heed of this. The doctrine of economies of scale is driving out innovation and local flexibility. It increases risk and deters new entrants from the market.

The UK boasts a strong and vibrant civil society. Charities are at the heart of that. This core is incredibly diverse, with an army of volunteers and staff providing help and support to individuals and communities nationally and overseas. If the Government truly want to deliver the aspiration of improving life chances outlined in the gracious Speech, they will not do so without the charity sector.

The week ahead in the Lords: 8-11 June - drugs, devolution and good deeds

So, the Queen's Speech out of the way, it's time for the business of holding Government to account. And, with our Parliamentary Party having found a space on the Opposition benches, it is time to get to work.

Three bills start their serious progress this week after the various First Readings went through on the day after the Queen's Speech itself.

The Cities and Local Government Devolution Bill builds on the 2009 Local Democracy, Economic Development and Construction Act and makes provisions for elected mayors and so forth (all very "Northern Powerhouse"). John Shipley will be leading for us on this, and although I for one have grave reservations about placing supreme power in the hands of people who, despite being democratically elected, won't really be that accountable, the idea of developing alternative economic engines outside London is a 'good thing', as Lord Bonkers would probably say.

With Tuesday comes the Psychoactive Substances Bill. Brian Paddick has already made his views on this abundantly clear. As he said on Tuesday;

I believe that an authoritarian approach, where blanket laws prohibit everything unless the Government allow it, sets a potentially dangerous precedent. The Bill is well meaning, with the current practice of selling so-called legal highs on the high street, one molecule different from a banned substance, in packets marked “not fit for human consumption”, is a nonsense. But we must ask ourselves, what is the purpose of this Bill? If the purpose, as it surely should be, is to prevent harm, the misuse of drugs should be treated as a health issue and not a criminal one.

He concluded;

This Bill would simply add to the confusion surrounding the attempts to protect people from the harm caused by misusing drugs and push pleasure-seekers into the hands of criminals.

On Wednesday, the relatively uncontroversial Charities (Protection and Social Investment) Bill starts its serious progress. This seeks to amend the 2011 Charities Act (which perhaps indicates the quality of some of the legislation passed in the last Parliament) and, whilst there are some differences of opinion, which Liz Barker will doubtlessly address, it isn't expected to take up a lot of the time of the House.

Raj Loomba has obtained a short debate on Thursday on "empowering women, including widows, in the developing world in order to aid conflict resolution and the long-term sustainability of more stable societies", a subject that he has been very persistent on since joining the House. Baroness Verma, responding on behalf of the Government, may provide some clues as to the future direct of Development Aid policy.

There are no Oral Questions from the Liberal Democrat benches this week - there were three last week, in fairness. However, Baroness Gardner of Parkes has one on Tuesday on extending the right to buy to Housing Association properties. Don't assume that, just because she's a Conservative, that ashe's in favour...

And finally, whilst one might conclude from the Parliament website that the Select Committees are not meeting, the European Union one actually is.

Far from the campaign trail - a happy 10th birthday to @suffolkgiving

My days are, for those who know me in a more professional capacity, not merely an endless round of tea drinking and paper oscillation. I do have a life which balances my work, to mangle another PR catchphrase.

This evening, for example, I was at an event to celebrate the tenth birthday of the Suffolk Community Foundation, an organisation dedicated to supporting good works across the county and which not only raises funds in its own right but also administers endowments on behalf of donors both corporate and individual which give grants to a range of causes.

It is a bit 'great and good', as one might expect, but then Suffolk can be like that. And, whilst I occasionally joke about having become a member of the country gentry, it isn't really a role that I naturally inhabit. I do, however, give what some may see as a generous amount each year because, for one thing, I can afford to, and for another, I am rather fond of my adopted home and want to put something back into it.

I have, at various events over the past few years, met a range of outstanding individuals and groups who do incredible work for the disadvantaged and vulnerable, either picking up where the public sector has left off, or offering resources or opportunities that would not have existed otherwise. And if, in some small way, I have helped to enable them to do so, it gives me a sense that life is not as wretched as some might suggest.

You could, if you like, consider it as the 'Big Society' that was apparently such a fashionable concept five years ago but is mentioned only in passing now.

In a rural county like Suffolk, it often requires relatively small sums to make significant changes to the quality of life of the citizenry, and the Suffolk Community Foundation does much to enable local communities to empower themselves. Since its official launch in 2005, it has handed out £10 million in grants and has a similar amount in its endowment funds - it is a key player in the charitable and voluntary communities.

So, happy birthday, Suffolk Community Foundation, and many happy returns for the years ahead...

@BaronessRos in the Lords: the role played by the voluntary and charitable sectors

It was Liberal Democrat debate day in the Lords, and Ros had sought a debate on the voluntary sector, a subject close to her heart, and here is her speech opening the debate

Baroness Scott of Needham Market (LD):

My Lords, it is a great pleasure to introduce today’s debate, and I am grateful to my noble and learned friend Lord Wallace of Tankerness and my noble friend Lord Newby for selecting this topic on one of two Liberal Democrat debate days. I declare an interest as chair of the National Volunteering Forum, as a trustee of the Industry and Parliament Trust, and as patron of Ace Anglia, which provides advocacy and support to people with learning disabilities in Suffolk, and of Wings of Hope, which is an educational charity focused on India and Malawi. I very much look forward to hearing from the other 20 noble Lords who will speak in the debate. With all due respect, between us we have many hundreds of years of experience in this sector, and I think the insights today will be very valuable.

What makes this sector so vibrant, so flexible, often challenging and occasionally frustrating, is its very breadth. Charities such as the National Trust, the RSPB and Oxfam are household names. They have hundreds of thousands of members and significant incomes. There are thousands more tiny local charities set up to respond to particular circumstances, sometimes even the plight of one individual who needs help. There are around 161,000 registered charitable organisations, and an estimated 600,000 which are not registered. However, 90% of charitable income is made by the top 10%. I would not want this morning’s debate to go by without paying tribute to the millions of volunteers and family carers who, often under very trying circumstances, display a quiet daily heroism.

This sector provides both quality of life services, such as those of the National Trust, and lifesaving services, such as those of the RNLI and the Red Cross. The Society of Friends reminded me of the important role which charities play in the campaign for change, and how important that is at a time when people are increasingly disengaged from party politics. Of course, as we go into the general election next year, I reflect that most of the political activity which is undertaken in this country is done by unpaid volunteers. We should remember that contribution, too. In some cases, the volunteers provide the service, and in others they raise money so that professionals can do their jobs. Charity shops alone raise around £300 million every year for their organisations.

With this variation, finding the right policy framework for all of these circumstances is very difficult to get right, both for government and for regulators such as the Charity Commission. It also makes it quite difficult for the sector to speak with one voice. I will leave it to other noble Lords with more experience to talk in depth about the legal and financial framework for charities. However, I want to start with a few general comments on that aspect, before going on to talk about volunteering, which is the main thrust of what I want to say today.

The total yearly income of the charitable and voluntary sector is £39.2 billion. That is down £700 million on the previous year, largely as a result of reduced public funding. Despite the recession, NCVO says that charitable giving is holding up reasonably well, although anecdotal evidence suggests that organisations are having to work much harder to raise their money. Voluntary organisations are also reporting an increase in demand for their services, and there is now a real question about how long they can afford to do more with less.

The recent cross-party report, Creating an Age of Giving, referred to a civic core of givers, but it refers to the fact that that core is ageing and shrinking. Investment in schemes such as payroll giving and technology that enables text donations, for example, and the use of social media, have proved to be very worthwhile. I hope that the Minister will tell us whether the Government will continue to provide the seed corn money required to develop such schemes.

Gift aid is really important, but the new small donation scheme is looking significantly underspent. Anecdotally, it would appear that that is because it is just too complicated. Will the Government undertake to see whether that is the case and make changes quickly if they need to be made?

UKCF’s Shine a Light research of December last year found that people are nearly twice as likely to feel confident when they give money locally, as opposed to nationally, that it is actually going to help those who need it most. More than half of them would give more and give it locally if giving was easier and they could see the impact of their donation. That is emphasised by the publication, just this morning, of a report by the Charity Commission on public trust and confidence. It makes the same point about people wanting to see how their money is being spent and the impact.

One area where you can best see that at work is in the community foundation movement. Like most shire counties, Suffolk has a community foundation, which supports a wide variety of charity and community projects throughout Suffolk. By making endowment-giving easy, it has provided a sustainable way to support local organisations. Match-funded schemes such as Community First have been a real boost. I hope that the Government will keep that success in mind and work with the community foundations to see how the schemes might be expanded. Recent evidence is showing an increase in local giving and a more thoughtful model of giving, which is a really important part of building a strong civic society.

Of course, what makes the charity sector is the volunteers. The best estimate is that there are about 15.2 million people volunteering every month, so there is clearly an incredible capacity for volunteering in this country, but there are concerns that the volunteer workforce is ageing. People are working longer, caring for very elderly relatives themselves, perhaps even becoming less altruistic, and it is becoming difficult to recruit new volunteers. It takes money to resource organisations and projects specialising in helping people to access volunteering opportunities, but we need to do that to widen the pool from which our volunteers are drawn. For example, the Access to Volunteering fund, piloted in three areas, supported about 7,000 disabled volunteers to become involved. That brought with it reports of improved well-being and significantly reduced isolation.

A few years ago, I had a conversation with a researcher who was looking into something called micro-volunteering. Partway through, I realised that what she was actually talking about was what I would have called “doing someone a favour”. In today’s disconnected, slightly impersonal world, that sort of thing is dying out. It seems very odd to people of our generation, but there is a huge role for social media, for example, in making those connections between people, because the old community connections are lessening.

It is also important to recognise that the old model, where volunteers would commit a certain amount of time every week and would do so over a lengthy period is very challenging for a lot of younger volunteers who have work and family commitments. They need more flexible volunteering opportunities. In Suffolk, the 2012 Olympic volunteers have formed a sort of permanent cohort of volunteers who come in and out for all the major events in the county; its success is in its flexibility. New technologies can be really important.

There was a time when the public, private and charity sector all had separate but very well understood roles. The picture is now much more complex and the lines between them are really quite blurred. Some of these developments have welcome aspects, but there are challenges. One of the most difficult issues facing the sector is the use by government of volunteering as part of unemployment policy. As I said before, we can all accept that volunteering can play a really important part in getting unemployed people out of the house, learning new skills and generally increasing their self-esteem. However, there is sometimes a question of compulsion. Someone who is made to volunteer in order to get their benefits is not a volunteer, and we should not call them one. These are work placements, and we have to understand that it makes life quite tricky for the existing volunteers to be working alongside people who are there only under duress.

Secondly, the Government need to remember that charities and voluntary organisations do not have an unlimited capacity to absorb volunteer labour wherever it comes from. There are too many reports of jobcentres simply sending people along to voluntary organisations with no thought as to how the organisation is actually going to use them. The voluntary organisations themselves need enough professional staff to be able to manage volunteers effectively, even when they are welcome.

All this is made very complicated by the increasing use of the third sector to deliver public services. Current estimates are that the contracts are worth just over £11 billion. I am in favour of this development, but we have to recognise that it limits the ability of the charity or voluntary organisation to set its own priorities. What happens then is that gaps in service begin to appear. It also compromises the perception of the public about the charity as independent of government. That has come out very clearly in the report published by the Charity Commission today: when a charity becomes dependent on public contracts for its survival, its independence can be jeopardised.

I shall make one or two points on the question of tendering for public services and the issues facing charities that wish to participate. First, the bidding process is often based on driving down price, which usually means labour costs. Most voluntary organisations do not pay their staff particularly well, but they do want to be fair. They want to pay the living wage and give their staff decent terms and conditions, but it is often difficult for them because they are competing with the private sector, which has no compunction about the use of zero-hours contracts or short-term contracts or with paying less than the living wage. Quite often the third sector is heavily disadvantaged when it comes to tendering. It is not just a moral question; evidence from the Living Wage Commission demonstrates that the Treasury could save more than £3.6 billion per year if everyone was paid the living wage. I wonder whether it is the business of the public sector to be discouraging the voluntary and charitable sector, which treats its workers well, by favouring the private sector.

Too often the relationship between the voluntary sector and the statutory commissioners is “us and them”; the commissioners are very controlling and do not really look at value or service delivery; it is really just about the money. Of course, when budgets are so pressed and when financial survival, territorial ambitions and all these things come into play, we can see why this might happen, but I think it is time for the Government to review it. Government and local government are major commissioners of services from the charity sector, so I support the NCVO call for a review of public sector markets to see whether they are still fit for purpose. A lot more training is needed for commissioners to ensure that when they say that service users’ needs must come first, it actually means something and is genuinely reflected in procedures. That means that we have to talk to the users. That is one reason I became patron of Ace Anglia in Suffolk: it provides advocacy for people with learning disabilities. It is really important to have a dialogue with people when tendering for the services that are going to affect them. Too often, it is either all about the money or it is about a superficial judgment of what people might like. You actually have to talk to people.

Sam Younger, just before he left the Charity Commission said:

There is too much duplication in the charity sector and too many charities are inefficient and poorly managed. Too many people set up a new charity without establishing whether there is a genuine need or whether another charity is doing similar work … the result is duplication and inefficiency … especially in an environment where charities are competing for resources.

That is the dilemma. When you look at it like that, from a strategic point of view, what he says makes absolute sense: there is not enough money to go around so duplication is a luxury that we cannot afford. However, if you look at it from the bottom up, from the point of view of individuals, there are many examples of where, collectively, the private, public and even voluntary sectors are simply failing to meet their needs. When that happens, the obvious response is to set up a new charity. That is why something like 2,500 new charities are being set up every year.

As I said at the beginning, the picture is complex and in many ways is getting more so. However, and I think that we would all agree with this, everywhere across the country we see volunteers, charities and community groups of all sizes taking an active role in addressing the problems of their area, building communities and campaigning for change. They are building a stronger civil society and a new social economy, and we should do everything that we can to help them.