The state has been a "fickle friend" to the voluntary sector and many charitable foundations are operating broken models, according to Paul Streets, chief executive of the Lloyds Bank Foundation for England and Wales.
Speaking as a delegate at the annual conference of the Association of Charitable Foundations in London yesterday, Streets told a panel including Sir John Elvidge, a fellow of the Carnegie UK Trust, that foundations should not behave like the government has: over-funding organisations and then withdrawing from them entirely.
He said foundations had a responsibility to support charities that had suffered because of state funding cuts because otherwise many of them would disappear in five or 10 years’ time.
"I want to challenge us all to be more urgent – there’s too much complacency in the foundations sector," said Streets. "Foundations need to be more activist – we need to do that because the state has been a very fickle friend to the voluntary sector in terms of its support. I would argue that many foundations are operating a broken model – a model that’s based on being the icing on a local authority fruitcake."
He said that many charities would benefit from help from foundations in reducing their cost base, looking at new ways of generating revenue and new ways of operating.
Responding to Streets, Elvidge said that one of the voluntary sector’s most profound "misdirections" in recent years had been to lose touch with the communities it served and move towards being either a substitute for the state or a partner with the state. "The sooner we reinvigorate the urgency about putting ourselves at the heart of a different perspective, the better," he said.
Avila Kilmurray, director, policy and strategy, of the Global Alliance for Community Philanthropy, who was also on the panel, said that it was partly the fault of foundations that voluntary organisations had aligned themselves more with the government and such a contracts-driven culture had developed.
Because of this, the foundations sector should not position itself as a "white horse" on the issue, she said, although it should help to facilitate discussions between cross-sector organisations and fund some cross-sector projects.