Public Services Reform, Retrenchment and Charity Finance

The political and wider public debates over the impact on charitable/voluntary organisations and social enterprises of the far-reaching cost-reduction programmes unleashed by public sector organisations continue to intensify. There remains uncertainty as to future contract and grant funding and historically under-funded areas outside Councils’ and PCTs’ fields of statutory responsibility are subject to particular pressure. This Board Paper argues that the leaders of charities, voluntary organisations and social enterprises need to equip their organisations – in terms of skills, financial planning and control systems, strategic self-awareness and good data on costs, financial and non-financial performance – for a changed financial ecosystem and risk universe. This involves strategic conversations and hard decisions, not about doing only what can be done with diminished funds from existing sources, but rather about how to identify, measure, fund and deliver what will be important in a rapidly-changing operating environment.

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