This speech on the future of the social sector was delivered by NPC’s Chief Executive, Dan Corry, at NPC Ignites on 13 October 2021. It has not been checked against delivery. Click here to watch the full recording of this speech.
Rethink, Rebuild and improving our impact
Covid-19 has been awful for so many, at a personal level and at a national level, but it’s also been a time of great change, and not all of those changes have been for the worst.
I am going to talk about some of what happened during covid, about the inequality it exposed, how our sector responded and what we—and the government—need to do to make the best possible impact for people as we emerge from the pandemic.
We know covid exposed many inequalities—inequality that was always there—as did the rise of the Black Lives Matter movement in the wake of the terrible events in the USA.
Sadly, these inequalities showed up very clearly in the figures for deaths from covid.
During the first wave, the ONS says the rate of death involving covid was highest for the Black African group (almost four times greater than for the White British group for males, and two and half times greater for females), with high rates for many other minority ethnic groups.
In terms of deprivation, analysis of ONS figures shows that from March 2020 to April 2021 those living in the bottom decile areas in terms of deprivation had a death rate from covid two and a half times higher than the least deprived decile.
In the second wave, even after adjustments for location, disadvantage etc., most Black and South Asian groups remained at higher risk than White British people.
Those figures on deaths are stark.
But it goes further and will last for longer.
As the recent Health Foundation covid enquiry pointed out, lockdowns, though necessary, have added to inequality as they had ‘wide-ranging consequences: from unmet health needs and mental health problems to education gaps, lost employment and financial insecurity’.
Charities rising to the challenge
Our sector has done its very best in difficult circumstances and we’ve shown just how important we are to society during covid. It’s been impressive. So many did so much.
There are so many examples, but this slide shows just a bit of it:
The bigger charities did some amazing work: the Trussell Trust delivered a major increase in emergency food parcels, a crucial lifeline for so many families and individuals. The British Red Cross was crucial in its work, for instance helping out with its assisted discharge service and so supporting around 100 hospitals across the country.
And many, many smaller charities did great work too: an example is the Rainbow Alliance in Solihull, which helped an estimated 12,000 people in the area with free care packages to people who were isolated because of covid or had reduced incomes or were experiencing difficulties purchasing food. Many, many others were doing the same.
We all remember the fantastic responses in terms of volunteering and the setting up of mutual aid groups and so on as covid erupted. Many people went above and beyond. It was uplifting.
It certainly felt like there was a lot more volunteering, with TV coverage of it and of mutual aid groups and NHS volunteers.
But it’s actually not that clear from latest ONS stats (the Community Living Survey 2020 / 21) that this is representative of what actually happened.
Contrary to what one might think, formal volunteering has been falling since 2013 / 14.
And it dropped sharply in 2020 / 21.
That may be surprising at first glance but maybe not so much given lockdown and covid nervousness?
Perhaps also not surprising that participation in formal volunteering at least once in the last 12 months was quite a bit higher in the least deprived areas (38%) than in most deprived areas (22%).
This difference and the higher presence of charities in more prosperous areas, is something we have highlighted before. It is troubling. And very relevant to the current ‘levelling up’ agenda.
On the other hand, and again not surprising when you think about it, informal, unstructured volunteering—‘giving unpaid help to individuals who are not a relative’—went up a bit, especially for those doing it once a month (28% 2019 / 20; 33% 2020 / 21).
Put all this together and you can see the trends on the graph:
Financial state of the sector
Trying to work out what state the sector is really in is hard to do at the moment. It’s difficult to tell from ‘failure’ or income data as yet—although academics are looking at this.
Hard data is very lagged (even the new NCVO Almanac only really covers financial data from 2018-19).
We know that those reliant on major public fundraising through in-person events, or income from charity shops were badly hit at the start. Those reliant on social enterprise activities—like cafes or paid for training courses—were also deeply affected by the lockdowns.
On the other hand, those with grants or contracts did rather better on average.
What about smaller charities? No good data, so it’s hard to tell. But evidence from previous recessions shows that they tend not to close at this point in the cycle but try to keep going. The damage caused will only become clearer as the covid tide goes out again.
Some say there were very big drops in income—mainly using self-selection surveys to try and assess this. For instance, Pro Bono Economics in June 2020 predicted a massive drop of £6.4bn in income over the six months to December 2020 and said one in ten charities were potentially facing bankruptcy.
But there is evidence the other way.
CAF’s UK Giving Report 2020 said donation levels in the first half of 2020 were actually up on the previous year by some £800m.
Cathy Pharoah of the Centre for Charitable Giving and Philanthropy, has tried to square the circle a bit by pointing to new charities cropping up during covid; new online approaches to donations, Captain Tom etc; and more publicity for e.g. local food banks—that encouraged more donations.
Certainly, even if the aggregate amount of giving did not change, there may have been big distributional changes as people wanted to fund very front-line covid related charities—and that will have hurt if you are on the wrong end of that trend.
Meanwhile, a recent report on charity shops conducted for Charity Finance magazine suggests that much of the losses made due to the closure of charity shops were made up through furlough and other covid emergency measures and support.
And though not enough for many, the government did cough up £750m to the sector—as well as other sums that helped some charities through support to the cultural and heritage sectors.
Perhaps of more concern is what’s left in reserves. The Charity Commission recently reported that the number of charities with an annual income of more than £500,000 that had no or negative free reserves had increased from 9% in April 2020 to 28% in July this year. A very big increase indeed. No doubt many smaller charities—below £500,000—are also facing difficult times.
One thing we might hope would be happening as a result of all this new focus on inequality is that funders have got the message and started to focus more on equality issues.
New NPC analysis of the GrantNav data (360Giving), looking at those grants that mentioned diversity, inequality or inclusion in the description field, shows that in England the proportion of grants citing these issues appears to be up—from 0.3% in 2019 to 4% so far this year. While the data and our analysis of it is very far from perfect with many health warnings, I think this is interesting and encouraging.
And as you can see from the graph, that was the case for most regions of England.
So, a lot of good things, but we must be ambitious to do better.
And we really are at NPC.
We think the sector can do better—and that’s not just about money.
Impact, achieving things, comes too low down the list of what charities and funders are all about.
If we could improve just a bit, we could do so much more.
Imagine the 168,000 charities (let alone all the social enterprise and community groups) each just helping—on average—one more person because of more effective use of their resources. That would lead to thousands more being helped. And because of the people our sector mainly works with, that would be thousands of those most in need.
Of course, this is not the way the world works but it gives a feel of why we must strive to do better.
It is often not our sector’s fault. A lot is about the pressures the sector faces, especially as regards funding. The need to compete, to get profile, to keep supporters and trustees happy—takes one’s eyes off the point of it all: having an impact and making people’s lives better.
A lack of accountability, of metrics, of reporting on impact—even more so for grant-makers—adds to an environment that pushes us away from focusing on our impact both as individual organisations and collectively.
So, can we put some of these behaviours right?
We have put on the table many things over recent years to increase the impact of the sector, both at an individual charity level and as a sector—using theories of change, using metrics and data, urging changes to regulation and reporting, pushing a focus on deprivation and where charities are located and where they are most needed. We’ve recently added a strong diversity lens too.
And some of the things emerging from covid—including the use of digital technology and more collaboration—echo areas we have always pushed on. We want to hold on to them and do more of them.
We’ve brought some of this latter thinking into our Rethink, Rebuild work with five main strands. It’s worth a look.
First, we need shared strategies to solve issues—we can’t solve big problems alone.
A housing provider for example is not going to solve homelessness by themselves, because they also need to solve mental health issues, substance misuse, family breakdown, domestic violence, employability etc. So it makes sense to work with others. This working together needs to be hardwired into everything we do. And needs funding to allow that.
Second, we need to make collaboration work and work for all—and that includes the big with the small.
Often the best insights come from those working directly on the front line. But these charities are often smaller and lack the resources to be able to throw their weight around when working alongside much bigger charities. It’s easy to see how this relationship can go wrong.
What can we do about that? We’re trying to find out.
Third, we need different approaches to funding. Covid-19 saw more unrestricted funding, delivered faster, in a less bureaucratic way. That’s good; very good. Let’s keep it!
But let’s not get carried away and think that these ‘trust based’ approaches mean being evidence free—if you really want to help the beneficiaries the best you can, you still need to understand your impact.
How we go about this impact assessment and measurement needs to evolve, but the basic need remains.
Fourth, we need to collect, synthesise and use data—of all kinds. We need data; and we need to be able to share the data and to share the intelligence that we gather. Government data too.
That allows us to direct the right services to the right people at the right time.
We need shared intelligence that combines official government data with real-time, often qualitative insights from charities and businesses.
Charities can provide the coalface view that high level statistics too often fail to capture.
Last, we need to be seen as a genuine partner by government at all levels. We need to be influencing policy aims and the choice of options to achieve them. We need to be taken seriously by policymakers at national and local levels, be this on health reform, ‘levelling up’, offender rehabilitation, youth employability, loneliness, social care or climate change. We have so much to offer.
But to do this we need to marshal our arguments, bring together powerful evidence, come up with practical solutions, and show that we really do speak for many—often the most vulnerable—and not just be seen as complainers.
We also need, collectively, to do the best job we can of showing our relevance to government as it develops its plans on how we rebuild the country as we recover from the shocks of the covid pandemic.
We need to move fast and shouldn’t miss this window of opportunity to show the many ways we are not just nice-to-have, but absolutely necessary to recovery.
And without giving up anyone’s beliefs or passion, we need to have some sensitivity to the politics of the time. It always takes two to tango and we need to play our role too.
These are the things we want to work on and are why we hope that many of you will want to join with us to further them.
Some might say, ‘can the sector change?’
It’s never easy. There are lots of excuses not to. But being open about the challenges as a sector is a very good start.
Many of the shifts that have happened due to covid, whether it’s more flexible funding or greater cross-sector collaboration, or more use of data, should be seized upon to rebuild the charity and philanthropy sector that we know we need.
If we miss this opportunity, we’re accepting a return to systemic failings that have needed to change for a long time.
Government needs to change too
But government needs to change too if the sector is to be able to do its best. That surely is something they want too.
So, stop bearing down unnecessarily on campaigning—there are genuine worries in the sector currently around the Police Bill and the Elections Bill, around restrictions on judicial review, plus we have the Lobbying Act and gagging clauses around contracts.
Give the sector a proper place in heart of decision-making—it’s nothing against the new Minister to say to government, you should not downgrade our voice with no dedicated minister, no office of civil society and tucked away in the wrong department. Civil society is at the heart of British life, and it needs to be heard in Westminster and Whitehall.
Please resist the temptation to have ‘woke’ attacks on charities because it is politically useful in the short term—this will cause long-term damage to our pluralist democracy.
Yes, support small, local charities: but also recognise how important the bigger, national ones are. Small charities need support but for many problems, size really does matter
This sector is crucial to solving so many ‘wicked’ issues—climate crisis, social care, poverty and inequity.
So, I say to the new Charities Minister—who we welcome warmly; to the Prime Minister; to the new ‘levelling up’ supremo Michael Gove; to the Health Secretary and to the COP26 President Alok Sharma, as well as to all the local leaders from Manchester to Essex and from Cornwall to Aberdeen, let’s find ways to work together. Because together we are so much stronger.
Thank you.'Let’s find ways to work together. Because together we are so much stronger.' Read Dan Corry's #NPCIgnites speech on the future of our sector here: Click To Tweet