Funding from the public sector is the largest single source of income for the voluntary sector - according to the NCVO's UK Voluntary Sector Almanac 2004, it brings in 37 per cent of the total. With partnership working increasingly common, Ruth Smith takes an alphabetical look at how charities can make their relationships work.
A is for applications. NCVO research shows that voluntary and community organisations find application processes lengthy, complex and repetitive.
"Be clear about what you are applying for and why," says Mubeen Bhutta, policy officer at the NCVO. "Do your research - know when the deadline is and find out whether you're eligible for funding. And make sure you have the capacity to deliver if you do win the contract."
David Hawker, director of children, families and schools at Brighton & Hove Council, says: "Make sure you demonstrate sound financial management, a stable organisational base and a capacity to manage your affairs efficiently."
B is for bureaucracy. "It's ridiculous," says Nick Aldridge, director of strategy at chief executives body Acevo. "Bureaucracy has got completely out control." He cites one charity with a 200-page contract for funding of only £2,000. "We have members employing staff to fill in forms for local authorities," he adds. "None are standardised and, because a lot of forms have to be completed on a monthly basis, this diverts massive resources away from delivery."
But Hawker says: "Don't get frustrated when local authorities' decision-making processes seem convoluted and slow. This is the price we pay for local democracy."
B is also for the Better Regulation Executive, the Government's attempt to reduce unnecessary regulation. "You can submit examples of unnecessary bureaucracy or regulation and government departments are obliged to respond," says Aldridge. See www.cabinetoffice.gov.uk/regulation.
C is for contract. Balancing hard-nosed contractual discussions with the fact that you're providing a service for vulnerable people can be difficult, so it's important to be clear about price, says Clare Tickell, chief executive of NCH, a major provider of children's services. This is why the other C, common ground, is important. "Remember, we're on the same side," Tickell adds. "Local authorities and voluntary bodies are both value-driven and can learn a lot from each other."
D is for delivery of services. "Don't deliver services that are not part of your organisation's mission," says Bhutta. "There is a danger that organisations follow the money. You should fit your activities to your organisational mission and the needs of your beneficiaries."
E is for evaluation - which, along with a monitoring process, must be agreed at the outset of any public sector contract. "Make sure your funding bids cover the resource implications of evaluating your work," says Bhutta.
F is for full cost recovery. Charities should always aim to recover the full cost of delivering services for the public sector - including administrative and overhead costs. The Treasury accepted this principle in 2002, and it should be implemented by 2006. Full Cost Recovery: a guide and toolkit on cost allocation, by Acevo and New Philanthropy Capital, helps charities to allocate core costs in a way that is compatible with public sector finance rules.
G is for governance. Good governance is vital to the way voluntary organisations operate and something that funders look for. Good Governance: a code for the voluntary and community sector was published in June by the sector's major representative bodies, including Acevo and the NCVO. See www.governancehub.org.uk.
H is for health. In September 2004, a strategic agreement was signed by the Department of Health, the NHS and the voluntary sector. Its aims include helping the sector to play a full part in service delivery and removing the barriers to effective joint working.
I is for independence. The Charity Commission says charities must not allow their independence to be compromised when delivering public services.
"Terms of agreements must not interfere with the trustee's duty to act in the charity's interests," says its policy statement on charities and public service delivery. It adds that it is good practice not to rely too much on one source of income where this could compromise independence.
J is for joint commissioning of services. "Local authorities haven't really got their heads around what commissioning means yet," says Trevor Sharman, head of family support services at Coram Family. He believes charities must educate local authorities about the value they bring to service delivery and fight for a level playing field.
K is for kicking up a stink. Some children's charities are concerned they will be excluded from children's trusts - new arrangements for commissioning and delivering services in local authority areas. Government funding will be channelled through local authorities and some charities think they'll miss out. But Maria Eagle, junior children's minister at the Department for Education and Skills, says: "If that happens, kick up a stink and let us know so we can take action."
L is for listening. Coram Family works closely with local authorities on a range of issues. Sharman says a key strength of his organisation is its commitment to listening and consulting parents. "It's something that statutory services are not as used to doing as voluntary bodies are, and therefore something they value in us," he says. "For example, SureStart was set up to be run by partnership boards that included parents and voluntary organisations. It's a positive model that could helpfully be replicated across other areas of service."
M is for manifesto. The Labour Party manifesto says the voluntary sector has shown itself to be "innovative, efficient and effective" and that its potential for service delivery should be considered on equal terms.
It flags employment training, children's and health services, correctional services and education as areas in which the sector could make a significant contribution.
But Bhutta warns: "The manifesto has given focus to public sector delivery by charities, but that won't always be the case. Organisations should balance public service delivery against their other activities."
N is for negotiation. NCVO research shows that most relationships with local funders are poor. Although attempts are under way to try to improve dialogue between funders and the third sector, Bhutta says it is vital to "negotiate as much as possible and remember that it should be an equal partnership".
But Cheryl Eastwood, assistant executive director of services for children and young people (social care) at Tameside Council, says there is little room for negotiation on individual contracts. "It's about over-arching contracts for the voluntary sector and what they can do for the money," she says.
O is for on time. "Whether you are funded on a quarterly or annual basis, make sure you are paid on time," says Bhutta. "Make sure your funders know that charities are employers so the impact of late payments can be drastic."
P is for partnership. "Get involved in strategic partnerships helping to plan future provision and make sure you always bring something constructive to the discussions," says Hawker of Brighton & Hove Council. "Local authorities respond well to positive suggestions that work with their agendas."
The Compact agreement in England provides a framework for partnership working with government. Under the terms of the Compact, government and the voluntary sector undertake to work together to improve outcomes for the community. Local Compacts aim to make this national agreement a reality at local level.
Q is for quality. "One of the things that drives local authorities is the performance framework from government," says Eastwood. "If you know what the performance indicators are, then that's a major advantage - this is a good way of getting work."
R is for risk-sharing. Understanding the risks attached to delivering public services is important, says Acevo's Aldridge. "The problem is the mantra of passing as much financial risk as possible to service providers," he says. He cites the example of Marie Curie, which provides nursing to terminally ill people in their homes. "The Government asked it to set up a service and pays it according to how many people the Primary Care Trusts refers," he says. "It means Marie Curie has all the risks attached to uncontrollable fluctuations. If it didn't have to bear all the risk and was paid for some of its fixed costs, it could hire more permanent staff and provide a better service."
S is for short-termism. "More than 90 per cent of voluntary organisations have one-year contracts for service delivery, so they don't have enough time to plan, improve or evaluate services," says Aldridge. "It's a huge barrier. Unless we get longer-term contracts from government to develop and deliver services, we're not going to get the impact both sides want."
T is for talking. "Look for opportunities to talk to elected members, senior officers and front-line staff about your work," says Hawker. "Often your organisation will have done some research or taken the initiative on a project that will help to shape future thinking. If local authorities start to see you as a leading-edge organisation, they will be more inclined to want to work in partnership with you."
U is for users. The NCVO, the National Consumer Council and the Confederation of British Industry have all conducted research that reveals the continued absence of the user voice at the heart of the public service reform debate.
A strength of charities could be their links with local users. "Service users are more likely to give their views to charities, which are independent of statutory authorities," says Eastwood.
V is for value. "Make sure you emphasise the added value you bring," says Hawker, "such as links with local community groups, your ability to generate extra voluntary income to support projects that can only be partly funded by statutory services, or your ability to mobilise volunteers to work with you. It is this that makes the statutory sector want you as a partner."
W is for websites. Useful information on working with the public sector can be found at www.ourpartnership.org.uk and www.acevo.org.uk.
X is for Cross Cutting Review, in which the Treasury made a series of recommendations to make it easier for the voluntary sector to take a greater role in public service delivery. In June 2005, a National Audit Office report said its funding recommendations had in the main been implemented but that this had not been enough to bring about a widespread change in government funding practices.
Y is for youth. Grants that enable charities to work with young people include the children, young people and families grant programme. It is designed to support voluntary bodies that contribute to the Department for Education and Skills' Every Child Matters programme, which aims to improve outcomes for young people.
Z is for zest - the inexhaustible energy and enthusiasm that voluntary and community organisations bring to their public sector partnerships.