Opinion: Hot issue - Should councils be censured for short contracts?

The chairman of the Local Government Association said last week that three-year contracts with the voluntary sector should be the norm. Kevin Curley of the NACVS said non-complying councils should be named and shamed.

YES - SULTAN BEGUM, compact advocacy team, NCVO

The failure of councils to recognise the impact of short-term funding on the voluntary and community sector can have serious implications, including an inability to plan and deliver services, retain staff and budget for the future.

We recognise that there will be circumstances in which a short-term contract is most appropriate. In most cases, however, longer-term funding ensures that voluntary and community organisations do not have to spend a disproportionate amount of time trying to secure income and can concentrate on delivering positive changes in their communities.

The Compact Funding and Procurement Code sets out good funding and procurement practices and contains commitments from the statutory sector to implement longer-term financial arrangements, advance payments and full cost recovery.

Local public bodies have plenty of scope to improve their funding practices and build partnerships with the sector through the promotion and implementation of local compacts.

The Compact also works as a tool with which voluntary organisations can negotiate with councils, and NCVO's Compact Advocacy Programme can support the sector in holding councils to account.

NO - ROMILLY ROGERS, policy consultant, Local Government Association

The LGA and the voluntary sector should not get into the 'name, shame and blame' game, but should instead focus on applauding and rewarding those who get it right.

Local government can do much to help the sector achieve its aims but, for its part, the voluntary and community sector needs to take responsibility for addressing internal challenges associated with governance, probity and financial stewardship.

Many local authorities have set up service level agreements with voluntary and community organisations for a wide range of their work. Agreements with the voluntary and community sector have been helpful, but more needs to be done to release the potential of these organisations in terms of building social capital, as well as empowering communities and improving services.

We support moving to full cost recovery, and with three-year contracts it would provide greater stability for the sector. However, it would be impractical at this stage to commit to longer-term contracts because local authorities have to deal with three-year flows of money from central government through the financial settlement and the Comprehensive Spending Review.

YES - DAVID HUNTER, policy and development officer, Acevo

Councils should be censured for short-term contracts. For too long, local government has prioritised short-term flexibility over long-term benefits in its contracting with the third sector, and has wasted time, effort and expense.

Acevo is delighted at the LGA announcement that three years is now to become the norm, but why stop there? Certain services provided by the sector - such as support for the elderly and care for the homeless - will still be needed in more than three years' time, so why not offer longer contracts?

Where appropriate, larger contracts that require significant capital and investment should be given for between seven and 10 years. As the revised Treasury guidance to funders states: "There should be no standard length of contract. Long-term planning and funding arrangements can often represent better value for money than one-year funding agreements." The naming and shaming of non-compliant councils should happen. The purpose should not be to antagonise, but to pressurise them into improving their relationships with the sector. Contractual reform is overdue; let's hope this announcement is matched by corresponding action.

YES - SUSAN GAMBLEN, business development manager, Leeds Social Services

The answer has to be yes. The changes facing both the statutory and voluntary sector in terms of procuring and delivering services present both sectors with major challenges - it has never been as important as it is now for us all to work together if we are to achieve the success and improvement in service delivery that we all hope for.

Any funding agreement, be it a contract or a grant, should be designed with the primary aim of making sure the users of the service receive the maximum long-term benefits.

It's fairly obvious that, in most cases, issuing a short-term contract would contradict that aim. Medium to long-term contracts offer continuity to the people receiving the service and allow organisations the opportunity to develop their strategies for sustainability and independence.

Long-term planning and financial agreements often represent better value for money and reduce time and effort for both sectors in terms of having to apply continually for money and renegotiate funding agreements. I believe short-term contracts can be useful when piloting a new service or procuring a service from a new organisation with an unproven track record. Otherwise, there are no benefits from what, in effect, is short-sightedness.

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