The 'lead funder' proposal - that a single department take responsibility for monitoring and auditing all cross-government funding to individual charities - was still on track when charities minister Fiona Mactaggart addressed the NCVO political conference last November.
The scheme was widely regarded as heralding a step change in the levels of bureaucracy encountered by the voluntary sector. Mactaggart promised to end red tape nightmares such as one organisation forced to provide 900 different pieces of information to four separate government bodies.
But a leaked report from the Department for Work and Pensions reveals that the Government is on the verge of rejecting the change because it is too difficult to implement.
The report concludes that many officials are too busy and have "no will to change". The civil service does not have the capacity to adopt the new practices that would be required to operate the lead funder principle, it notes.
The report, written by Mark Fisher, chair of the National Lead Funder Pilot, goes on to argue that the Government has produced so many codes on procurement practice that they are "ultimately self-defeating ... It is not within the capacity of any normal human being to hold all this information in their heads."
Stephen Bubb, chief executive of Acevo, condemned the Government's faint-heartedness over the pledge. "We've shown conclusively that duplicated and inconsistent red tape is getting in the way of service delivery," he said. "Astonishingly, the Government seems to have ducked the issue in favour of cosmetic tinkering at the margins. As it stands, the report has all the force of a wet lettuce leaf."
The DWP report does concede that its conclusions will be "a little disappointing" to those sector service providers expecting a "new theology of contracting".
But it also has some strong words for the sector. "The risk-averse culture in which we operate is driven somewhat by bad experiences generated by a small minority of poor-quality, or even downright fraudulent, providers," it claims.