Craig Dearden-Phillips: spending cuts are an opportunity, not a threat

Sector will benefit as government commissions lighter, more responsive services, says our columnist

Craig Dearden-Phillips
Craig Dearden-Phillips

Three-eleven. This chilling-sounding number refers to March 2011, just over a year from now, when government spending for the following three years will be set; when the world as we know it today will end and cuts will kick in.

For those too young to remember, there are, broadly, two approaches to cuts: salami-slicing and downsizing. Salami-slicing takes a bit off everyone, so that everything looks the same - just 10 per cent smaller, slower, worse.

Downsizing, on the other hand, takes three possible forms. The first is to abolish recently added bits of government spending that nobody will miss. The second is to offer less of something and ask the parent, patient or householder to make up the difference. And the third is still to offer it, but find someone who will do it better and more efficiently.

We will, of course, see both salami-slicing and downsizing from the next government. My guess is that downsizing will be the main order of the day: you cannot, in reality, salami-slice 30 per cent from most public services any more than you can take a blade off a helicopter and expect it to stay in the air.

So what does this mean for the third sector? Many of us are very nervous about downsizing, because a lot of what we do is discretionary, added-value, icing-on-the-cake type of stuff - activity it's easy to slew off without bad publicity. So should we be living in fear? Some of us should.

But the opportunities presented by downsizing may well exceed the risks. We do things differently; we speak to the needs of our time. The sheer weight of former state services that might fall our way could dwarf current government funding; a future Niagara next to today's gentle stream.

All the parties know it's all over for the 'big state'. Never again will government be viewed as the natural provider of all health, education, welfare and offender rehabilitation services. Yes, government will fund and, yes, it will commission and keep us all accountable. But its clock is ticking down. Ours, by contrast, is coming up to the hour.

And there are other trends going our way. The Iain Duncan Smith 'broken society' agenda plays straight into the hands of our community sector. New money will flow here, if nowhere else. New bidding consortia such as 3SC will help innovative third sector players to find new ways to fly and new social enterprises will shoot off from the NHS and local councils.

So three-eleven need not chill your blood. Indeed, it might even warm your heart.

Craig Dearden-Phillips writes in a personal capacity. He is founder and chief executive of Speaking Up.

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