John Tizard and David Walker: What a Labour victory in 2015 might mean for the sector

Ed Miliband's party needs to return to and refresh the agenda that it failed to complete when last in government

Ed Miliband
Ed Miliband

How long would William Shawcross survive as chair of the Charity Commission if Labour won the election fifteen months from now? Perhaps that’s too blunt a test of the party’s intentions for the voluntary and community sector. Put more gently, Labour surely has to take a view before the election on the future role of the regulator.

The Cameron coalition has sidelined but not expunged Labour’s own legacy on regulation, especially the Charities Act 2006 and its requirement that charities demonstrate public benefit. Would the test get teeth and bite private schools or hospitals run by the likes of that oddly profit-oriented charity Nuffield Health?  

But that would be just part of a bigger picture. What does Labour, faced with rampant unfairness and growing social need, see as the role of the VCS in a modern social democratic state? Is it an ally in the Miliband project – part of the alternative to what the Labour leader calls predatory capitalism?

Impediments to a love-in remain large. Austerity wouldn’t melt if Labour ministers took over in May 2015. They would inherit the apparatus of prime and subcontractors in the Work Programme and of ‘any qualified provider’ in health. If, say, the former were regionalised or handed to councils, how would Labour guarantee the VCS role, perhaps even as a player in policy-making?

John TizardCameron has built bias in favour of private business into public service contracting, so how far would Labour go to support charities and social enterprise? Would it, for example, give them easier access to loan capital or subsidised training and remodel commissioning and procurement towards collaboration rather than competition?

Historically, the sector has expected more of the left, given Labour’s commitments on social justice and equalities, so it’s in everyone’s interests for the party to put its commitments and wishes for the VCS in an honest order of doability – and share its thinking in a collaborative spirit.

In return, Labour deserves a decent measure of goodwill from the VCS. Blair and Brown were accused of statism and excessive central dictation, but on the back of Labour’s long affinity with self-help by powerless people (through the friendly societies, trade unions and elected local government), their administrations were also friendly and generous to non-profit enterprise and charities. The 10 years from 2000 feel, at this remove, like a golden age: the creation of a Whitehall presence at the Office of the Third Sector and the welcome given to the VCS on local strategic partnerships were convincing signals of good intent.

Since its defeat, Labour has been giving ear to those urging more space for voluntarism, mutualism and community social action. Such philosophical debate on resetting the boundaries of state, economy and civil society has been bracing even if (and perhaps this is welcome) Labour has come up with no big society-style badge. But it’s now time to assess what Labour ministers would do in practice.

Some questions, then, starting with the Cabinet Office brief for the sector (which, of course, Ed Miliband - pictured above - himself held from 2007 to 2008). Would Labour give its Office for the Third Sector clout, allowing it to join up policies in health, criminal justice, the arts, work and pensions, and communities?

Labour could enshrine charities’ right to independence and an unfettered voice as part of its wider review of the sector’s regulation. It could also ensure that public commissioning and procurement respected the sector, its independence, voice and ability to innovate and experiment.

Some contracting of services will continue, so would Labour go beyond Cameron’s Social Value Act in allowing commissioners to give weight not just to price but also to quality, community engagement, sustainability and employment standards, including the living wage? Labour needs to understand better than last time what the sector can and cannot do in addressing deep-seated inequalities of condition, income and job market leverage, and what the state should do, without becoming a clunking fist, in strengthening charity governance and financial stewardship, even in the smallest and most fragile community organisations

Labour must also work with the VCS national bodies to build capacity, expanding the sector’s reach, diversity and effectiveness. It should also encourage councils and other local agencies to mirror such approaches.

A Labour government in 2015 would, of course, face mammoth challenges on every front, and legislative time would be severely constrained. But a radical Miliband-led government should create the space to revisit what Labour failed to do last time – establish a 21st-century definition of non-profit enterprise and purpose.

It’s time for a new definition, embracing all non-profit organisations, whatever their legal structure – charity, community interest company – and backed by select tax privileges and statutory support. A Labour state would surely recognise that its own health depends on cherishing voluntary effort and community social action.

John Tizard is vice chair of Navca and an independent adviser and commentator. David Walker is co-author with Polly Toynbee of The Verdict – Did Labour Change Britain?

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