Whitehall culture shift

The Office of the Third Sector is approaching its first birthday with some promising policies under way, but not all its ambitions have yet been fulfilled. Corin Williams reports.

Westminster: The Office of the Third Sector still has plenty to strive for after its first year
Westminster: The Office of the Third Sector still has plenty to strive for after its first year

Soon after his appointment last year, third sector minister Ed Miliband made a bold declaration: "I want to make every department a third sector department."

A more cautious politician, with longer experience of the jealously guarded boundaries and sensitivities of Whitehall ministries, might have hesitated to nail his colours to the mast quite so decisively.

The ambition has been set back on those occasions when Whitehall has persisted in its bad old habits in relation to the voluntary sector, as when the Department of Health withheld a grant for CSV for 10 months and his office failed to react swiftly when told about it (see opposite page).

But there have been successes, such as persuading the Department for Work and Pensions to change its mind over lunch expenses for volunteers and the ring-fencing of Big Lottery Fund grants to the sector during the latest Olympics raid by the Government.

On the policy front, the Office of the Third Sector has published the third sector action plan, Partnership in Public Services - the blueprint Miliband hopes will play a key role in persuading the whole of government to give a fair deal to charities and the voluntary sector. The plan includes a commitment to improving contracts for public services delivered by the voluntary sector and was bolstered by Gordon Brown's simultaneous announcement in the pre-Budget review that three-year funding for the sector would be the norm from 2007.

Earlier this month, Miliband announced the first action resulting from the plan - a £2m national training programme for 2,000 people who commission public services from the voluntary sector. The two-year programme will be run by the Improvement and Development Agency and is expected to start in the summer (Third Sector, 14 March.)

At the same time, the Office of the Third Sector, with its total of 55 civil servants, is being reorganised by its new director-general, Campbell Robb, the former NCVO policy director who was a researcher for David Blunkett MP in the 90s and a press officer for Chris Smith MP from 1996 to 1997.

The office is to have five departments: social enterprise and finance; community participation; third sector support; public sector partnerships; and strategy and communications. Deputy directors on salaries of between £55,000 and £77,000 are currently being recruited for each section.

"The Office of the Third Sector has been going for eight months, and we're starting to change the culture within Whitehall and local government," says Miliband. "There's always further to go, and there needs to be a better understanding of the role the third sector can play in society. The key indicators of success for the sector will include greater stability in funding, more three-year funding and greater understanding on the ground, within commissioning and the grant-making process."

All this indicates a renewed government interest in and commitment to the voluntary sector, but the various blips and apparent contradictions have not escaped criticism, as when the normally low-profile Sir Clive Booth, chairman of the Big Lottery Fund, spoke out about the Olympics raid. "One part of the Government," he said, "is trying to strengthen the voluntary sector through the Office of the Third Sector and a charities minister in the Cabinet Office, while another is kicking away the crutches."

This theme is picked up by Debra Allcock Tyler, chief executive of the Directory of Social Change, which articulates the views of many smaller charities. "It took the chair of the Big Lottery Fund to challenge this Government's raiding of lottery money - something that Ed Miliband should and could have done himself," she says.

A survey conducted through the charity's email newsletter last year also uncovered great scepticism about the Office of the Third Sector: 38 per cent of respondents said the new department would have either no effect or even a negative effect, and 28 per cent said they didn't know or didn't care.

A fresh survey might produce better results in the light of recent developments, but Allcock Tyler thinks the figures reflect a growing power gap within the sector. "In theory, Miliband runs the office for the whole of the sector, yet there is no evidence of any initiatives for those voluntary and community organisations that are not taking statutory funds," she says. "He appears to be interested only in those with a financial stake in the state."

Although Allcock Tyler speaks well of the "very personable" minister, she worries that his words are not always followed by action. "For example, he speaks eloquently about the need for the Government to allow charities a campaigning and challenging voice," she says. "We like that - but grant terms and conditions from his office and Capacity Builders don't back that up. In our opinion, he has not made enough effort to spend time with smaller, more local charities and seems to rely heavily on traditional infrastructure bodies for advice. This isn't the only example of voluntary and community groups losing out to conflicting priorities."

Miliband denies this. He says the consultation for Partnership in Public Services was the largest ever with the sector and won a Compact Gold Award, the top prize for good relations between public and third sectors. He kept up a punishing schedule of visits last year, making more than 60 speeches in 115 working days. "The sector has been very generous with its time and ideas," he says. "Government needs to know what it's like to run a small organisation."

Dr Gareth Morgan, director of the Centre for Voluntary Sector Research at Sheffield Hallam University, shares the general optimism about Miliband and the new office, but sees the tasks ahead as daunting. "Some departments talk about the importance of the voluntary sector, but when it comes to commissioning, they treat organisations differently from the private sector," he says. "There have been plenty of such issues around primary care trusts. It's a huge task that will take a while yet."

Morgan sees a contradiction between pumping funds into infrastructure organisations and freezing funds for the Charity Commission, which faces a range of new tasks under the Charities Act."Joining up all of government's sector-related work is not totally achievable," he says. "The Office of the Third Sector is a diversified office. I'm not sure about the interaction between the charity law side and the wider voluntary sector infrastructure issues such as ChangeUp. The charity law side is under-resourced and has a relatively small team."

Dame Elisabeth Hoodless, executive director of CSV, also remains a fan of Miliband despite her negative experience over the Department of Health grant. "Government is a complicated animal," she says. "To have a dedicated minister with energy and focus is a m

Whatever the criticisms levelled at the office, most people in the sector seem to want it to succeed. More importantly, they want it to remain high- profile and effective even after Miliband - a Gordon Brown protege - moves on. "His most important legacy would be to have this post seen as a properly important one within government," says Allcock Tyler. "Before Ed's appointment, it appeared to be an interim post for out-of-favour ministers on their way down or young apparatchiks on their way up. We hope he doesn't get reshuffled because he does seem to have the ingredients to make it work."

ajor step forward."

Fighting Fires with Ed Miliband

Snuffed out

The volunteering charity CSV crossed swords last summer with the Department for Work and Pensions, a ministry described by the charity's executive director Dame Elisabeth Hoodless as "not sympathetic to volunteering". The department had decided that volunteers receiving Jobseeker's Allowance or Income Allowance were not eligible for lunch expenses - a distinctly anti-third sector policy.

Miliband took up the issue and the department not only backed down, but also gave him credit. The minister responsible, James Plaskitt, said he was sceptical at first, but took his colleague's advice."The change to the policy was primarily brought about after representations from the voluntary sector via Ed Miliband," he said. Hoodless also credits Miliband. "It was my understanding that he had an important part to play in getting DWP lunch vouchers paid to volunteers by intervening at ministerial level," she says.

Burnt fingers

Another episode last year also concerned CSV, which had been awarded a £3.7m grant from the Treasury for its Capital Volunteering programme. The money was routed through the Department of Health, which held on to it for so long that Hoodless complained at the beginning of November to Miliband's office. When she didn't get a response, she went to the press just before Christmas, prompting embarrassing headlines about the 10-month delay. Miliband got involved last December and the money - and later the interest - was paid earlier this year. Miliband admitted in the Commons that it was a "bad case", and the Conservatives took advantage of what Whitehall officials admitted was an open goal. It was a painful episode for Miliband and some of his staff.

Still smouldering

If Ed Miliband had succeeded in persuading government colleagues not to raid the lottery again to help pay for the 2012 Olympics, he would have been the sector's undoubted hero. If he had succeeded in protecting all voluntary organisations funded by all lottery distributors, it would have gone down almost as well. As it is, he succeeded in protecting the voluntary sector's 60-70 per cent of grants from the Big Lottery Fund, which will take its Olympics contribution from awards to statutory bodies instead. Voluntary organisations funded by the arts, heritage and sports lottery distributors are bracing themselves for losing part of the £250m diverted to the Olympics. Given the political pressures involved, the episode is said by sector leaders to represent a substantial achievement by Miliband.

Joining up policy

The problems of joined-up government are not confined to the adoption of good practice in relation to the voluntary sector. The charity Living Streets, whose work in health, transport and the built environment crosses several departmental boundaries, has seen progress on the policy front, but foresees problems. "Ministers from across Whitehall meet regularly to focus on physical activity, and we've recently had an opportunity to interact directly with them," says director Tom Franklin. "It means that government is making the most of outside expertise and not just bringing us in after policy has been established.

"The difficulty will be ensuring departments that are not directly measured on physical activity, but have a huge effect on it, have the incentives to prioritise this work. The Department for Transport, for example, has more impact on physical activity - through its responsibility for streets - than the Department of Health."

Franklin also thinks good practice is developing in Scotland. "Scotland has had the advantage of being able to design a parliament for the 21st century. Westminster is mired in traditional ways of dealing with the public and outside bodies."

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