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Two-thirds of public bodies say there are barriers to drawing up contracts with the voluntary and community sector.

The survey for the Futurebuilders £125m fund - set up by the Home Office to increase the role that the voluntary and community sector plays in the delivery of public services - cites financial, policy and structural constraints.

It also finds evidence of contracts failing to take account of the full financial costs to voluntary groups of providing services. Only 3 per cent of the 30 purchasers surveyed said their contracts covered loan repayments and interest. Training costs were included by 60 per cent and start-up costs by half.