The Society Network Foundation, the charity that owns the Big Society Network, has issued a statement denying claims that it used political pressure to secure more than £2m of funding from the Cabinet Office and the Big Lottery Fund.
A statement from trustees of the SNF, issued today, said there had been "unsubstantiated claims that SNF and BSN used political pressure to secure awards of funding and that money has been misused.
"The SNF trustees unequivocally reject all such suggestions for which there is no evidence whatsoever."
The statement said the charity was solvent but was "not planning any new projects".
It said that trustees had instructed its lawyers, "who have made a formal complaint to the Press Complaints Commission concerning The Independent newspaper, which originated the story".
It said that trustees had been "completely open" in all their communications, and that the charity had been the subject of numerous requests under the Freedom of Information Act. "As far as the trustees are aware, all communications between the SNF and the Cabinet Office, the Big Lottery Fund and any other relevant public bodies regarding any awards of funds are in the public domain and have been so for some time.
"If there had been any political influence in the allocation of funding for the SNF, then that would have emerged in that documentation."
The statement said that the allegation that the SNF received favourable treatment because of links to the Prime Minister, David Cameron, who launched the Big Society Network in 2010, was not true.
"If anything, the association with the BSN made it more difficult for SNF to secure funding from private and public funding bodies that make political neutrality an imperative," it said.
"All the bids for funding for the many projects run by the BSN/SNF complied fully with the procedures laid down by each of the grant awarding bodies, and none of the trustees are aware of any funding that was granted other than in strict accordance to the criteria laid down by these bodies."
'No evidence on Nesta claim'
It also said that no credible evidence had been supplied to support what it called "media claims" that the innovation charity Nesta was forced to fund the Big Society Network.
Liam Black, who was a trustee of Nesta – a non-departmental government body at the time – when it made awards totalling £480,000 to BSN, said on Twitter last month that the organisation had been "forced" to provide funding.
"Any allegations that a public body was ‘forced’ to fund an organisation are serious and potentially very damaging to individuals concerned, and yet the trustees have received no evidence to support these claims and further note that Nesta has rejected these claims," the SNF statement said.
It said that the National Council for Voluntary Organisations seconded staff to the BSN to help it apply for grant funding from Nesta.
An NCVO spokesman said this morning that Oli Henman, who was the NCVO’s UK and international campaigns manager, left the umbrella body’s payroll for about eight months from September 2010 to work on the Society Network’s Foundation’s Your Local Budget scheme, because he had a personal interest in participatory budgeting, but did not work on the funding bid. There was no cost to the NCVO for the arrangement.
The NAO said that the Cabinet Office had changed the eligibility criteria for the Social Action Fund after an application for funding from SNF for the child fitness project Get In had been rejected. The department then invited the charity to apply for a grant, and it was awarded £300,000.
The SNF statement said that the charity had been unaware that the criteria had been changed until the NAO report was published.
Meeting with Charity Commission
The statement said that the charity has been in contact with the Charity Commission since March "regarding some aspects of its end-of-year reporting".
It said the charity met representatives of the commission on Wednesday "and enjoyed an open and transparent conversation about SNF’s work and projects and reassured the commission that these were conducted in accordance with both the guidelines of the relevant grant-awarding bodies and SNF’s charitable objectives".
The commission has been looking into issues about the transfer of a grant from restricted to unrestricted funding and other accountancy issues, including payments to related parties.
The SNF statement said that Martyn Rose, chair and co-founder of the Big Society Network, was paid £40,000 for the provision of contracted office services and consultancy support over the past four years, as agreed by trustees.
"Martyn Rose contributed £193,000 personally to the Society Network Foundation and its operating subsidiary Big Society Network, a not-for-profit organisation, meaning that overall he made a net contribution personally of £153,000 to these entities," the statement said.
"As a successful entrepreneur and investor in early-stage business, both private and social enterprises, Martyn Rose’s involvement in SNF was to give back to society and led him to devote a considerable amount of time to help further the organisation’s objectives.
"Payments were made to two directors who are part of BSN’s executive management team for their work on behalf of BSN and the various projects with which they were involved as was both appropriate and as is standard practice in these circumstances."
A spokeswoman for the Charity Commission confirmed that the meeting had taken place. She said the commission had received the trustees’ full cooperation, was continuing to assess the information provided and had asked for more information to help it in its inquiries.