News in focus: How independent is the Big Fund?

The Lottery Fund's involvement with the School Food Trust has reopened old debates, writes Mathew Little.

The icy relationship between the Big Lottery Fund and the voluntary sector appeared to be thawing after some conciliatory statements from the new distributor in recent months.

A promise to ring-fence up to 70 per cent of its grant money for the sector, a new £155m programme for voluntary sector infrastructure and a commitment to full cost recovery had begun to assuage fears about the direction that the controversial successor to the Community Fund would be taking.

But the mood of rapprochement has been overtaken by a new controversy over the hoary old issues of additionality and independence. The Government's announcement that the Big Lottery Fund would be supporting its plans to improve school meals had all the elements of a PR disaster.

A Department for Education and Skills press release stated that the fund would provide £45m of the £60m cost of setting up the new School Food Trust announced by education secretary Ruth Kelly. Sector umbrella bodies the Institute of Fundraising, the chief executives body Acevo and the NCVO were unanimous in condemning what they considered a blatant breach of the additionality principle - the rule that the public's weekly flutter should not be used to fund activities that are the Government's responsibility.

But the DfES announcement was wrong, said the Big Lottery Fund, which claims to have agreed only in principle to fund joint projects with the School Food Trust as part of a wider grant stream encouraging healthy eating. Even that commitment is not cast-iron, according to BLF director of policy Vanessa Potter. The School Food Trust is a "potential partner", she says. "We don't know where the funding is going yet. It's entirely possible that it will all go to the voluntary sector."

There was yet more fuel for the critics, however. A letter last week from fund chairman Sir Clive Booth to Acevo asserted that the Big Lottery Fund will continue to "complement government programmes". It will not be a "purist version of the Community Fund", he added.

Acevo chief executive Stephen Bubb says: "This means that not only do they not understand what they've done wrong, but they will do more of it. They've been repeat offenders - the school fruit pilot, MRI scanners. If these don't represent inappropriate use of lottery money, which is supposed to be additional, what does?"

Exactly what is additional to government spending is a grey area, according to the Big Lottery Fund. The New Opportunities Fund worked on the principle that it should not "substitute for current or planned government expenditure". But the Big Lottery Fund has a new definition: "Funding should be distinct from government funding and add value."

The crucial principle, says Potter, is that the lottery does not dive in where the state has withdrawn funding. But she contends that critics have not come to terms with the fact that government is now working in more and more areas of social life that overlap with the traditional preserves of the lottery and charities.

"If you work in health and education and there are lots of cuts, it's easy to draw the line," she says. "But we have been operating over a period of unprecedented increase in public expenditure. The Government has funded many areas that it didn't prior to 1997. The social exclusion and regeneration agendas have made us think about how we work with government."

Potter denies that the fund has been leaned on by the Government to support its initiatives on school meals. "We've been talking with the DfES," she says. "It would have been ridiculous not to link in what we're doing with the wider announcement."

But former Community Fund board member Steven Burkeman suggests the School Food Trust affair shows the BLF is losing independence. "I'm sure that is not what the board wants to happen or thinks is happening," he says. "It may be being manipulated into positions it is powerless to oppose.

"The real discussions are going on between the chief executive and senior civil servants. I suspect that the board is being presented with something approaching a fait accompli. It is given the appearance of being able to make a final decision, but the final decision has already been made."

Not all sector leaders are preoccupied with the internal processes of the Big Lottery Fund, however. Kevin Curley, chief executive of the National Association of Councils for Voluntary Service, argues that charities should look at the outcomes - £155m for voluntary sector infrastructure and a total of £700m over three years.

"My members are pleased about the resources they are getting," says Curley. "It's time to move on and talk to the Big Lottery Fund about how these programmes are designed. We can't do this if we are constantly wrangling over yesterday's battles."

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