A £16.5m 'modernisation fund' to help the voluntary sector with mergers and partnerships is the biggest component of the Government's £42.5m action plan for the third sector, announced today.
It also contains £15.5m for a 'community resilience fund' that will give grants to small and medium-sized voluntary organisations that provide services such as skills development and debt and family breakdown advice in the most deprived areas.
A third strand of the plan is £10m for a volunteer brokerage scheme by the Department of Work and Pensions that will aim to create opportunities for 40,000 unemployed people to help their communities and learn skills by volunteering.
The amount of money in the plan, which also includes a £500,000 investment in the School for Social Entrepreneurs, falls short of what sector leaders wanted. Chief executives body Acevo called for £500m and the National Council for Voluntary Organisations £100m.
Liam Byrne, Minister for the Cabinet Office, said in a statement that the Government had been monitoring daily what was happening to donations and demands for new services, "and with incredible support from the sector, we're launching a laser-targeted package of help".
A statement from third sector minister Kevin Brennan said the aim was to help people in hard times, find more equitable ways of doing business through social enterprise, and empower people to "transform their lives and communities".
Stuart Etherington, chief executive of the NCVO, gave the package a cautious welcome. "We see this help as a start as we are just at the beginning of the recession," he said. "The two key things we asked for – the modernisation and resilience funds – are in the package of support."
Stephen Bubb, chief executive of Acevo, said that the action plan was a welcome start. "It targets real need and provides capacity-building support, but more will undoubtedly be needed as the recession unfolds," he said.
"We look for real action on Gift Aid in the budget and the quick establishment of a social investment bank to build a major package of support for the sector to help those most in need."
More details of the plan will come in a briefing by ministers at noon today. It is expected to include about 20 measures, including a national campaign to raise awareness of the Government's commitment to pay all invoices within 10 days. This is intended to improve the cash flow of small organisations.