The funds the sector has lost from local authority funding cuts will be more than compensated for by an increase in social investment and payment-by-results contracts, according to Lord Nat Wei, the government’s big society adviser.
Speaking at a meeting hosted by the Calouste Gulbenkian Foundation in London yesterday, Wei said that the social investment market could be worth about £10bn in future, and that it had been estimated that the value of payment-by-results contracts to voluntary sector groups could grow to £60bn. He did not mention any timescale for the figures.
"I think, over time, local authority cuts will be less than what’s being proposed here," he said.
Moshoda Khatun, an outreach worker at the charity City Gateway, told the meeting that her charity would be unable to do its work without government funding.
Wei, a founder of the charity TeachFirst who was appointed to advise the government on its big society agenda last year, also said that a "social auditing sector" would have to develop in the UK, made up of organisations that helped charities to measure the impact of their work.
"There are not enough organisations that can measure their outcomes or how much money is recoverable from the state budget because of what they do," he said. "I’m looking forward to developing that."