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For many people, the attraction of working in the voluntary sector is being able to do the job free from the bureaucratic burdens that blight the lives of those who opt for a statutory sector position.

While a role at a voluntary or community organisation has its downsides - poor pay, scarce resources and funding worries - most believe the independence it provides outweighs these disadvantages.

Despite a call from National Council for Voluntary Organisations chief executive Stuart Etherington in a speech at the London Metropolitan University last week for the sector to "abandon belief in the mythical golden age when charities and the state had no relationship at all", some are predicting that the sector may be gambling its independence by entering into a deal with government to deliver public services.


Although the sector has provided services since the 19th century, particularly ones to alleviate ill-health and poverty, previously it has worked largely on its own terms. Now it is being asked to provide services on a larger scale than ever before and in accordance with strict government targets.

The initial reaction to the government's ambitions for the voluntary sector, announced a couple of years ago, was suspicion.

Having been underfunded and undervalued by successive administrations, it was inevitable that the sector would ask why it suddenly found itself in favour, hailed as the saviour of public services.

Many concluded that the government's new-found admiration was born of a desire to do things on the cheap. Ministers, naturally, had a different explanation, which was that because of its flexibility the voluntary sector could do something that many councils had spectacularly failed to do: reach society's most marginalised groups.

Attempts have been made to dispel the notion that the vision for the voluntary sector is money-led, and £218m has been allocated to implement the Treasury's cross-cutting review on The Role of the Voluntary and Community Sector in Service Delivery, published in September 2002, which sets out plans for its new role.

To a sector starved of cash for so many years, the money appeared to be a positive sign that the government was willing to finance its ambitious agenda.

Next month the active community unit, which promotes the voluntary sector within government, will publish its strategy on how to develop the sector's infrastructure and capacity, using £93m of the cash.

The publication of the strategy is eagerly anticipated, especially among those who still harbour reservations about how they will be equipped for their future role.

Researcher Luke Fitzherbert, who works for charity support organisation the Directory of Social Change, describes the money as "froth on the top" and says that although it may sounds significant it is insufficient.

He believes that the fundamental question about independence, which has been somewhat brushed aside by the focus on implementing the review, remains unresolved.

"When a charity becomes reliant on a dominant funder, it is putting its independence at risk. If all your money comes from one particular social services department, for example, if they say 'jump' you have to say 'how high?'," he argues.

Even the NCVO approaches the issue with some trepidation.

Last week, Etherington tempered his criticisms of those who argue there should be no relationship between the sector and government with warnings that "a close relationship with government is certainly not without risks". He urged organisations to "exercise extreme caution, make maximum use of the compact and go into relationships with government with their eyes open".

But the local compacts, mutually binding agreements between the voluntary sector and local authority, offer little protection. They have no legal basis and, five years after their supposed arrival, only 120 of 380 local authority areas have one.

With the relationship between the local authority and the voluntary sector governed by such a weak mechanism, questions have to be asked about how effective it can really be in protecting the interests of voluntary organisations.

Its three main weaknesses - lack of awareness, poor implementation and limited scope - are acknowledged in the review, alongside plans to strengthen it. But Fitzherbert is emphatic that it will not happen because "the welfare of the voluntary sector will never be a major priority for statutory providers".

Aside from the battle that many individual organisations may face in preserving their independence, a broader issue is at work. The government has assured the sector it will not have to sacrifice its independence or be forced into delivering public services - but there are signs that it may be left with little choice.

David Tyler, director of umbrella body Community Matters, fears that the government has narrowed its focus in terms of the voluntary sector, choosing to concentrate on social care organisations. Dangers inherent in such an approach are that those with no service delivery purpose, such as campaigning charities, will struggle for funding.

Early victims of the trend away from campaigning organisations towards those delivering services include the Low Pay Unit, which was forced to close in February after 29 years. Its campaigning work, which helped lead to the introduction of a national minimum wage in 1999, improved the lives of millions. When its closure was announced, director Richard Towers said that, if it had been running a project, the unit's future would have been secured.

More examples like this could see the celebrated diversity of the sector destroyed and replaced by a sector of uniform organisations funded largely by the government to deliver its services and policies.

Inevitably, organisations combining service delivery and campaigning may feel less able to oppose the government or risk losing money. Fitzherbert believes that organisations should take on contracts only where the work would not otherwise be done, but worries that some may be tempted "to go whoring after the money". The price for those that do will be high: a responsibility to meet a range of government-set performance indicators.

Neil McInroy, director of the Centre for Local Economic Strategies, says: "It is worrying that the sector's critical voice may disappear and that the accurate, finely honed services they currently supply will be forgotten because they are trying to chase bigger targets."

Head of the Association of Chief Executives of Voluntary Sector Organisations Stephen Bubb says that the sector "has nothing to fear" from the introduction of performance indicators. But in the next breath, he adds that it is the flexibility of the sector, made possible by its freedom from bureaucracy, that gives the sector its strength.


Councils have become increasingly frustrated by the onslaught of performance indicators and inspections in recent years. While it could not reasonably be expected that voluntary organisations would take public money without being accountable for how it is spent, there is a potential danger that implementation of the cross-cutting review's proposals could see them become as ensnared by inspection regimes as councils.

The review says: "In contracting with the VCS [voluntary and community sector] to deliver services, government must ensure that regulation is proportionate and the independence of the sector is recognised. The greater the regulation, the greater the risk that the best features of the sector are smothered."

Lord Filkin, the minister responsible for the voluntary sector, says: "It is not about 'taking government money'. All grants and contracts with the voluntary care sector and, indeed, any other provider are fairly let, and they are expected to deliver quality services according to agreed targets. This is about maintaining standards in public services delivery and about value for money. The question of independence of the sector has no relation to this at all."

But there is a growing body of research that insists that community organisations are being co-opted by the government, which could in turn reduce their ability to tackle social exclusion. A report by think-tank Demos, on more than 40 community-based projects, concluded that voluntary groups were being used as "instruments of government policy". Another study by the Economic and Social Research Council, released last month, said that although voluntary organisations were enjoying a greater say in policy-making, they risked losing their "autonomy and critical edge".

There are also questions around whether the sector has the skills and necessary relationships with councils to make the plans work.

Improving the relationship between councils and charities, which at the moment is often characterised by mutual suspicion of the other's motives, will be no small task. One of the biggest complaints by the sector is that councils do not take their work seriously and cut their funding with little notice. For their part, councils may feel reluctant to give contracts to the voluntary sector, especially as if the arrangements fail it will be the councils that could find themselves penalised in the comprehensive performance assessment inspections.

Without incentives to give contracts to medium-sized voluntary groups with links to the grassroots, and the knowledge that they will not suffer if mistakes are made, there is a danger that councils will opt for safe choices, such as national charities with which they have established relationships.

Arguably, such organisations have no greater connection to what is happening at the grassroots than do local authorities. Filkin says: "Nobody can compel medium-sized community groups that are not interested in delivering services to do so. However, the government recognises through the resources attached to the recent cross-cutting review that the capacity of the sector has to be developed and boosted in a number of ways to enable it to increase its role in public service delivery."

Filkin says: "Councils who are committed to meeting the needs of socially excluded citizens will ensure that contract specifications reflect their needs, while their contracting process will ensure that contracts are awarded to those providers best able to meet their needs."

But with their experience of bidding for contracts and their greater human and financial resources, large charities may seem a safer bet. As McInroy points out: "Councils are wary of devolving services because of issues of accountability. They know that if something goes wrong, the buck stops with them."

At present, there is a huge shortage of skills in the voluntary sector, particularly in the groups that the government is targeting. Fitzherbert estimates that there are 200,000 full-time employees in the sector, but that the lion's share of the work is done by the 1.8m full-time volunteers. He argues that there is no reason why they should be expected to become competent service deliverers.

One way for the government to help is by providing more training. Bubb says that the sector is notoriously bad at developing its staff. But even this will not stem the flow of workers out of the sector in search of better pay. It is unlikely that a worker in the voluntary sector will be content to earn significantly less than their council-based counterpart.

A report released earlier this month by voluntary sector think-tank nfpSynergy predicted a recruitment crisis in the sector because of its history of low pay. It says that societal changes - such as the ageing population, decreasing birth rates and an increase in student debt - will mean that many people, especially graduates, will not be able to afford poorly paid jobs.

Filkin says it is outside the remit of the government to set pay scales for the VCS. He adds that the Compact Code of Good Practice on Funding says organisations submitting funding applications are responsible for costing their working realistically, including future salary increases.

In three years' time, the cross-cutting review's 42 recommendations will have been implemented and then it will be known how successfully the money has been used. But Fitzherbert believes history proves that involving the voluntary sector in service delivery does not work.

"Thirty years ago [US] President Johnson tried something similar. A lot of charities took the money and began delivering services. They lost their flexibility and advocacy role, but it didn't matter because in their place sprang up a whole new breed of small voluntary organisations." 

- The Treasury review is at: www.hm-treasury.gov.uk/media//AFF00/CCRVolSec02.pdf