30 October 2003
Speech by the Chief Secretary to the Treasury, Paul Boateng MP, at Nuneaton and Bedworth Council for Voluntary Service
Opening words
1. First of all, I would like to thank you for all the work you are doing. This Government is keen, as you know, to work in partnership with the voluntary and community service wherever possible. And as with any partnership, this means listening to challenging messages, and being aware of the constraints in which each side operates. For example, as you are no doubt aware, central government has both legal and tax payer responsibilities within which it must operate.
2. And Councils for Voluntary Service are particularly valued partners…. so I am really delighted to be here at your AGM today, and to have the chance to say a few words. I also understand that it is your 30th birthday this year – so perhaps I should start by wishing you many happy returns.
3. And I would like to pay tribute to your work and dedication during these thirty years, and to make it clear that we see the roles of Councils for Voluntary Service as more important now than ever.
4. As this Government has sought to build on its partnership with the voluntary sector, these Councils have played a truly vital role in channelling communication between individual voluntary & community organisations (VCOs) and the different levels of local, regional and central government. And I am sure you, as an organisation, will play an essential part in developing this relationship in the future as well.
Background
5. Much has changed in the last 30 years. Tonight I would like to discuss these changes – and to put developments and future challenges into context. I would like to describe how the role of the state has evolved and is continuing to evolve – and how this will affect the voluntary and community sector. I want to emphasise the importance we attach to making this new relationship with the voluntary and community sector work –especially in the field of service delivery.
6. Before the changes brought about by the 1945 Labour Government, the government’s remit strayed little beyond law and order. Against such a background, few would disagree that the creation of the welfare state and the National Health Service was a revolution that brought with it enormous benefits. Millions found they had rights to education, basic social security, employment, and health care for the first time. The health of the nation improved, and absolute poverty and degradation became largely a thing of the past.
7. No one should underestimate how revolutionary this was. I myself – brought up in North London, born in Tottenham – experienced this revolution. This manifested itself in a form many of you will recall – including cod liver oil, malt and orange juice in medicine bottles. As a result, my maternal grandparents could be sure that their first grandson would grow up with straight legs and limbs, not suffering from rickets.
8. But, as the welfare state expanded in size, it too often came to be seen as substitute for communities. And there was a sense in which that individual initiative and the philanthropic spirit were stifled in the process. This was an unintended consequence. Clement Atlee, for example, believed strongly in state and private philanthropy working together.
9. Under the Conservatives – in Margaret Thatcher’s premiership – things changed again. The role of the state was to be scaled back, and there was little attempt to work in partnership with charity. Instead, charities were to be obliged to take over at the point at which the state withdrew. There was certainly no partnership of the type we are seeking now – in which government and charities work together.
10. This government wants to develop a new relationship between state and civic society – one that draws inspiration from Clement Attlee’s vision of, “co-operation of voluntary organisations with the state whereby more flexibility is obtained, for there is room for experiment in new methods, and the devoted services of those interested in the work are secured."
11. So, I am happy to say, a more balanced approach has emerged at last – one which values a strong and effective civic society thriving alongside markets and the public sector; one in which the two are complementary. The Compact was one our first commitments – as the Prime Minister said: “The Compact provides a framework which will help guide our relationship at every level…it recognises that the Government and the sector can fulfill complementary roles.”
Past achievements
12. So if this is the guiding principle behind our actions – what have those actions so far involved?
13. As you are aware the Government conducted a cross-cutting review of the voluntary and community sector in 2002, involving a range of stakeholders including the network of Council’s for Voluntary Service (NACVS).
14. The review looked at how the role of the sector in public services could be strengthened and how barriers could be removed. And it served as a recognition that the Government wants to work more effectively with the voluntary and community sector to achieve our objectives of world-class public services and the reinvigoration of our civic life.
15. The review highlighted the particular strengths of the sector, and the areas where it could make a distinctive contribution. We discovered very fast what you already know – that the voluntary sector has a vast array of specialist knowledge, experience and skills and that it has access to the wider community, free of all our institutional baggage. The sector is indeed often uniquely placed to reach marginalized groups and communities.
16. Discovering this and not doing anything to try and tap these strengths would have been wasteful indeed. Fortunately that has not been the case. We have already done a great deal as a direct result of the review.
Progress on the cross cutting review
17. Progress has been in the three key areas recommended by the review.
18. The first of these has been the need to address issues surrounding the funding relationships between government and the sector.
19. The Active Community Unit is, at the moment, in detailed discussions with government departments to help them to understand the real costs involved in VCS service delivery. The key challenge is to implement full cost recovery at a local level, which is a task that should not be underestimated.
20. However, the review also identified a clear need to issue guidance on funding. Last month the Treasury published our “Guidance to Funders”, which aimed to tackle the widespread perception in the voluntary sector that Treasury rules over funding are inflexible. This Guidance clarifies what is and is not allowed under Government Accounting – which I hope will make it easier for funding bodies to understand how this is applied to the voluntary and community sector.
21. The second main area of work has been the need to address the capacity needs of voluntary and community organizations. Because alongside the sector’s real strengths – its grassroots connections, its freedom to innovate, its closeness to those we need to serve – voluntary and community organizations do face barriers which impede their work. To help them to overcome these barriers, the sector needs to equip itself with the infrastructure, including IT, to support its activities, and it needs to enhance the skills of its staff and volunteers – to ensure that their dedication has the social impact it deserves.
22. To look at ways to help the sector tackle these capacity needs, the Active Community Unit recently published their consultation document on an infrastructure strategy. The aim is to develop a coherent strategy to support the role of the sector in service delivery. I hope you will engage with this consultation and give your views as a CVS – I understand that the West Midlands consultation event is being held on the 1st of December in collaboration with Regional Action West Midlands.
23. Connected to the larger issue of capacity building is the Futurebuilders initiative – which I know you are keen to hear about tonight. The Treasury has recently announced the final design of Futurebuilders – following a summer of consultation around the country during which we received over 500 responses and held consultation events in each region.
24. Futurebuilders is a £125 million investment fund to help individual voluntary and community organisations increase the scale and scope of their public service delivery. It is about enhancing the capabilities of the organisations that deliver front-line services, with the focus on key services – including health and social care, crime, community cohesion, education and learning and support for children and young people.
25. Futurebuilders will help to redress the lack of capital investment and development funding in the sector. It will use grants and a range of loan-type finance to do this. Finance will be tailed to the needs of individual organisations according to their needs and capabilities.
26. We’re in the process now of appointing the fund manager of managers – how Futurebuilders is set up and run will be critical to its success. We found from consultation that there is a strong preference for Futurebuilders to be sited outside government and closer to the voluntary and community sector. Our intention is that the fund will come on stream in the second half of this financial year.
27. The third and final area of progress that I would like to highlight today is the support we have given to the full implementation of the Compact – which, as I mentioned earlier, itself seeks to improve and develop the relationship between the Government and the voluntary sector.
28. The core of the Compact is the recognition of the mutual advantage of having a thriving and independent voluntary and community sector that is well supported by the government. And it needs this advantage to be recognised across central government. This is why in central government we have appointed departmental “champions” who are personally responsible for the effective implementation of the Compact within their departments.
29. We are also committed to increasing the number of local Compacts. And so I am delighted that not only does your Chief Officer, Liz Stuart, sit on the Compact Working Group, but that you have also taken the lead in the development of the Warwickshire County Council Compact.
30. The Compact has done a great deal over the years. Indeed I think it is fair to say that there have been improvements in the relationship between the Government and the voluntary and community sector every year since the Compact was launched … and the Compact is 5 years old next week – which is another anniversary for us to celebrate!
Future challenges
31. So a great deal has been done. The government is determined to do more, and we are financially committed to doing so – including not just the £188 million Spending Review settlement for the Active Communities Unit, but also the £125 million Futurebuilders fund.
32. And there are a number of challenges up ahead. Particularly in implementing the review at the local level. We know this is a crucial issue – after all 70 per cent of VCS activity happens at the local level. Engagement on the ground is essential if the review is to really make a difference.
33. And to build on the foundations of the 2002 cross cutting review, the Treasury is working in partnership with the Active Community Unit, DTI and ODPM to conduct a second review to inform our 2004 spending commitments. This will examine the public services where the Government wishes to extend the role of voluntary and community organisations in delivery.
Closing words
34. I think that what I would really like to emphasise to you all today, is that we need to improve the welfare of our communities in novel ways. As Helen Keller said, “the world is full of suffering, but it is also full of the overcoming of it”. The key is to be innovative in our approach. When it comes to delivering services and alleviating need, this is to the advantage of everyone.
35. And I believe very strongly, that this government is willing to reassess the traditional boundaries between the state, the voluntary sector, and indeed the private sector. We see partnership as the key to delivering on our promises. After all these partnerships give us access to a wealth of knowledge, experience and ability. We hope too, that from your perspective, partnership with us can offer new opportunities for voluntary and community organisations to deliver on their own objectives.
36. We are entering an exciting new phase in the relationship between Government and the voluntary sector – with the possibility to deliver our joint vision of better services in a more caring and cohesive society. Your role as a Council for Voluntary Service is vital. As I said, when I launched the review, we need your help to “build a bridge between the needs of individuals living in communities and the capacity of the state to improve their lives”.
37. Thank you.