Merger or takeover?

Battles lines have once again been drawn between the voluntary
sector and the government. It is noticeable that New Labour has
failed to calm suspicions in some parts of the voluntary sector
that, in the government’s view, they are a ready resource which can
be called on whenever the state’s coffers run dry. The compact
between the two sides has, some in the voluntary sector argue,
turned them into servants of the welfare state rather than
partners. Just as the government has sought to bring more private
money into the public sector through public-private partnerships,
so voluntary sector funds are marshalled to do what the state
should have financed itself.

Tessa Jowell, the secretary of state for culture, media and sport,
has entered the fray by committing herself to a merger of the New
Opportunities Fund and the Community Fund, both of which are
financed by the national lottery. According to Jowell, the merger
will enable funding of the voluntary and community sector to be
better co-ordinated as lottery revenues decline, but there are
fundamental differences in the operation of the two funds which
give cause for concern.

The Community Fund, formerly the National Lottery Charities Board,
has prided itself on its independence of government and its
determination, showed when it stood by its decision to give money
to an asylum support group against fierce resistance. The New
Opportunities Fund, however, has a much closer relationship with
government. Whereas the Community Fund finances many small-scale
projects that complement publicly-funded welfare, the New
Opportunities Fund has been nowhere near as scrupulous in observing
this principle of “additionality”. Its focus is on the mainstream –
health, education and environment – where it is not nearly so clear
that the bill should be picked up by the charity donor rather than
the taxpayer.

So which ethos will prevail when the two funds become one? Given
the government’s track record, there are fears that it will see in
the voluntary sector a means of plugging the gaping holes in areas
of service delivery, such as long-term care, at the expense of the
important causes which are surely the sector’s raison d’etre.
Unless there is much more clarity about the boundary between the
obligations of charity and the duties of government, there is
little chance that these fears will be allayed.