The warning comes in the umbrella body's response to the Conservative green paper on the voluntary sector, Voluntary Action in the 21st Century, which the party released last June (Third Sector Online, 3 June 2008)
The green paper criticised the Government's raids on the Big Lottery Fund to help finance the 2012 Olympics, and pledged to "restore the integrity of the National Lottery" by replacing the Big Lottery Fund with a Voluntary Action Lottery Fund, with no diversion of funds to public sector projects.
The NCVO response says that although all the funds distributed by the Tories' proposed fund would go to the sector, it would receive only 40 per cent of total lottery funding.
The Big Lottery Fund currently receives 50 per cent of all funding proceeds from the lottery. The NCVO has previously proposed that the proportion of BLF funding going to the sector should rise from its current level of about 80 per cent to 100 per cent.
"In our view it is entirely possible to work with the BLF to strengthen its commitment to providing funding that is independent and additional and that provides support for local, lightly specified, demand-led funding," the NCVO response says.
The umbrella body also expresses concerns about the Tory proposals to make all contracts outcome-based. "Such contracts will only encourage innovation if there is a fair apportionment of risk, and the contract does not seek to transfer all of the risk (and associated costs) to the service provider," its response says.
However, the NCVO also welcomes many of the measures in the green paper, such as the proposal for the Office of the Third Sector to be replaced by a Department for Civil Society with its own secretary of state and select committee.
The Tories should also publicly repeat private assurances given by shadow charities minister Nick Hurd that a Conservative government would recognise "the vital role that VCOs play in campaigning and advocacy", the response says.