Regulation with Rosie: Spending plans

The Charity Commission's Rosie Chapman on setting three-year spending plans.

The gloom cast by the Comprehensive Spending Review across central and local government is slowly starting to lift. Departments and local authorities are looking at their priorities for the next few years and, inevitably, noting what they can do without.

In choosing between the services they have to fund and those they'd like to fund, it's inevitable they will squeeze the latter. The good news for charities contracted to deliver services is that this could be just the time to maximise the chances of achieving settlements lasting three years or more.

These organisations know how the cumulative reductions in their income will now look over the next three years. Savvy charities should be in a position to cost budgetary changes fully and recommend to their funders that three-year contracts are in everybody's best interests in these straitened times. After all, what is the point of duplicating administration and tender costs every year, when a three or five-year fix works just as well and reduces bureaucracy?

So the review's reinforcement of the advisability of three-year contracts might pave the way for three-year settlements for charities delivering public services to become the norm.

Commissioning authorities can't afford to have any unexpected financial demands a few months or years down the line, and might be more receptive to agreeing to contracts that are longer and fully costed from the start.

Year-on-year cuts in government funding might even bring charities and commissioning authorities together in agreeing on multi-year contracts. With less funding from the Government over the next few years, charities need to think about being on the front foot in negotiating the terms and duration of their contracts as quickly as possible.

- Rosie Chapman is executive director of policy and effectiveness at the commission 

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