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An independent ombudsman to “name and shame” organisations guilty of bad practice in the way they contract with the voluntary sector should be established by the government, a report published this week recommends, writes Sally Gillen.

It is one of a number of key proposals to come out of a year-long study by the New Philanthropy Capital and published by the Association of Chief Executives of Voluntary Organisations into government-funding of the voluntary sector.

Acevo chief executive Stephen Bubb welcomed the call, arguing that delivering public services would give charities a great opportunity to improve people’s lives but that they could not be run on “hand-to-mouth funding”.

The recommendation, alongside ones to set up an accreditation body to kitemark funders and a penalty scheme for those who fail to comply with a funding framework, should be implemented by 2006.

To achieve a kitemark, funders would have to abide by a numbers of principles including giving multi-year contracts and allowing an appropriate timescale for service development.

New funding models are also proposed within the report, including “year-zero grants”, which would give organisations time and money to become established before being expected to deliver services.

Head of the National Consumer Council Ed Mayo said: “The research has uncovered an archaic, deeply inefficient array of funding models, based on a spare change mentality that stifles more effective action and leads to debilitating insecurity.”