Against the odds, the contract for using the £215m fund to foster public service delivery by the voluntary sector has been won by the Adventure Capital Fund rather than the incumbent, Futurebuilders England, which has run the programme since its inception four years ago. How did this come about, and what does it portend?
At one stage, it looked as if a clutch of private sector organisations would be among the bidders (Third Sector, 10 October 2007), but in the event there were only the two candidates. The rules of the tendering process meant the track record of FBE, including positive assessments by bodies such as the National Audit Office, could not be taken into account. It is also no secret that the Office of the Third Sector and its predecessors sometimes found FBE to be independent-minded and difficult to deal with. Nonetheless, the margin between the scores of the two contenders was said to be extremely small.
What probably made the difference was a closer alignment between the ACF approach and the way the Government wants Futurebuilders to be run. There has been a shift in its philosophy on this over the years, and FBE was probably more in sympathy with the original philosophy. With its experience of what works and what doesn't, it may have come across as less amenable to those changed priorities.
The FBE approach, comparable to that of the NCVO, was that public service delivery by the voluntary sector should be developed with caution, as and where appropriate. Its loans and grants were directed not only at organisations that were on the brink of being ready to take up contracts, but also at small organisations with some way to go but a lot to contribute in a social sense - groups wanting to deliver services for ex-offenders, for example, or black and minority ethnic organisations. The ACF approach was more comparable to that of Acevo - hardly surprising, given that it is chaired by Acevo chief executive Stephen Bubb. In this approach, the priority is to minimise bureaucracy and push ahead with the core task of getting more public service contracts into the hands of the sector. More gung-ho, according to one pro-FBE observer; less "romantic", according to another who is pro-ACF.
Some fear that the result of the change will be that the smaller and more socially valuable groups will get less help from Futurebuilders and that the larger, more contract-ready organisations will do better. This seems likely, although the principal reason for this might lie more in the nature of the Government's requirements than in the approach of ACF, which has helped many smaller organisations with grants. Those requirements include targets not for the number of investments made by Futurebuilders, as in the past, but for the number of public contracts pulled in by the organisations in which it invests. That will tend to favour organisations that do not require very much hand-holding before they can sally forth and win contracts. The scale of contract-winning, and of its beneficial effects, will in the end have to be balanced against any losses on the social front.