Councils spend £3 billion a year on services provided by the voluntary sector, but neither party is making the most of the relationship, according to a new Audit Commission report published today.
Hearts and Minds: Commissioning from the Voluntary Sector, finds that councils and voluntary organisations are starting to realise government ambitions to expand the role of the sector in delivering public services. But those ambitions demand a great deal from commissioners and service providers who face a number of barriers to working together effectively.
The report finds that those commissioners who are getting the best from their relationship with the sector do not necessarily give voluntary providers special treatment, but commission intelligently from service providers of all kinds. They understand the needs of their service users, know their market well, and have effective procurement processes in place. Better councils have introduced more strategic commissioning, with a greater use of service level agreements for grants, and more alignment of contracts with councils' strategic objectives.
But the relationship between many councils and the voluntary sector is blighted by poor commissioning practice. This is perpetuated by a lack of information on important issues such as comparable unit costs for services, as well as a lack of evidence provided by the sector of any added value it brings.
Furthermore, some councils treat voluntary organisations as one homogeneous sector subject to the same contracting rules and processes, when in reality the sector is very diverse. This has caused concern among smaller service providers who do not feel equipped to compete for business with larger organisations on a level playing field.
In some areas, government plans to increase the role of voluntary organisations are constrained by a lack of capacity in the sector. The limitations of capacity-building initiatives such as ChangeUp and Futurebuilders have recently been acknowledged by central government, and the report makes a number of recommendations as to how they can be improved.
Michael O'Higgins, Chairman of the Audit Commission, said:
'As the Chair of a voluntary organisation myself, I welcome the government's promotion of the third sector as I've seen first hand the wealth of experience, local knowledge and skills it can bring to local services. 'But it's up to the sector to help councils select the best organisations to deliver local services. What the voluntary sector needs is clarity, not charity, and that means improving bidding processes and demonstrating its worth in clear and measurable ways. 'We should be quite candid in pointing out that this relationship is not always a match made in heaven, but I'm confident it has the potential to be hugely beneficial for councils and the voluntary sector if they are willing to work closely to encourage intelligent commissioning across the board.'
Notes to editors
- As well as Chairman of the Audit Commission, Michael O'Higgins is Chair of Centrepoint, the national charity working to improve the lives of socially excluded, homeless young people. He has been on the Board of Trustees since 2002.
- The Audit Commission is an independent body responsible for ensuring that public money is spent economically, efficiently and effectively, to achieve high-quality local services for the public. Our remit covers around 11,000 bodies in England, which between them spend more than £180 billion of public money each year. Our work covers local government, health, housing, community safety and fire and rescue services.
- As an independent watchdog, we provide important information on the quality of public services. As a driving force for improvement in those services, we provide practical recommendations and spread best practice. As an independent auditor, we ensure that public services are good value for money and that public money is properly spent.
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