Where next for charities and the state?

For 20 years NPC has been helping philanthropists and charities to maximise social impact in the lives of the people they serve. To mark our 20th birthday, we’ve been talking to leading figures and people doing things differently to ask: Where next for social impact? In this essay, our Head of Policy and External Affairs, Leah Davis, responds to the arguments made by our essayists and interviewees on the relationship between charities and the state. We’ll be discussing all of these themes at NPC Ignites – Book your ticket here.

Our 20^th anniversary essay series highlighted how deeply intertwined the relationship between government and the charity sector, at both the national and local level, has become over the last 20 years, and indeed in the century before that. They also demonstrated the real tensions that exist between charities and the state.

Some may well argue these tensions are natural. Lots of charities supply public services on behalf of national and local government, and relationships between commissioner and supplier will often be tense at times. A recent report commissioned by DCMS showed these contracts were worth £17bn between 2016 and 2020 and NPC’s own research showed more charities are taking on government contracts. With this scale of contracts, it not hard to see why at least some charities would find relationships with government difficult, and vice versa.

Other charities have large teams of people (or small in the case of NPC!) dedicated to persuading government to change its policies to make the lives of the people they serve that bit better. Charities and government can work constructively together to solve policy challenges, but just as often, charities are campaigning from the outside for government to change policy, almost inevitably leading to tensions. At NPC, we think this tension is integral to a functioning democracy, where civil society can raise issues and hold government to account in ways that other sectors simply can’t.

But as our essayists showed, this tension can sometimes turn into something much more fractious and, arguably, destructive. So-called culture wars are probably the most visible example, but perhaps more insidious is where there is diminishing trust between charities and the state, and a lack of opportunities to find ways to work together to help the very people we’re both here to serve. As one of the few organisations that works across the sector to help charities and funders to make a greater impact, this is probably the greatest challenge we face at NPC in our efforts to champion policy change for the entirety of the social sector.

So how do we improve the relationship? Because it’s vital for our democracy that we get this right. And with a growing cost of living crisis we can’t ignore the current challenges, or allow the relationship to limp slowly on, or even worse, decline. Our essayists give us a number of ideas. Rachel Maskell argued that the sector needs to be more organised in its lobbying, comparable to the CBI or the TUC. Chris Sherwood advocated for much better use of evidence, and Samuel Kasumu argued for a more sophisticated approach from charities, which better separates policy from politics.

This last point is one of the most crucial. Because some charities, and let’s remember it is just some, advocate for policy change, some policy makers and politicians view the whole sector as inherently political. Those of us who know the sector well, know this isn’t the case. But as at least some of our essayists highlight, that’s the perception of some. This, frankly, isn’t helpful for the people charities serve, nor is it good for our democracy. So it’s something we need to change.

Seeing the whole sector as political misses the many facets of the role charities play in society. A role that no other sector can play. So we need to lift ourselves out of the day to day politics and define very clearly the charity sector’s core role in society – what we do to make the lives of people in this country better, and how we can do this better than other sectors, namely government or business, ever could. Politicians across the political divide may argue about how large or small this role is, but we lack a shared understanding across the political parties, and even within the sector, of where the intrinsic qualities of charities make them the best at confronting particular problems.

So for example, it’s often said that charities are better at supporting people who face multiple disadvantage because those people have far greater trust in charities, than in government. We just do it better. Whether that’s through government contracts, or services funded through philanthropy or social enterprise, no one else can or does do this work as well as the VCSE sector. Charities who work closely with different people in different social groups can also have better knowledge, intelligence and, sometimes, data on the different needs of people in different groups. This intelligence can often be more recent and more useful than government or business statistics. And of course charities support people from some of the most marginalised and ignored groups in society to have their voices heard. Business and government just don’t do this as well.

As anyone who has spent any time working in the sector will know, evidence to prove all this is sparse. This is something we need to change. We need to show whose lives we make better, where they are and what we do. We need data and evidence of what changes we’re making and what works. There have already been lots of shifts over the past 20 years on this, but we’ll need to accelerate and build on this progress. We’ll need to put politics aside for this exercise – we’ll need to work hard to gain cross-party consensus for it to work. As an independent voice within the sector, we at NPC want to work with charities and funders to gather the evidence and to work with MPs from across the political divide.

And as Rachael Maskell argued, the sector will need to get organised. It has already been making some steps to better organise and represent itself through the Civil Society Group. But with few of the big name charities getting behind charity sector calls, our influence is just too dispersed. We need a collective effort across the sector to focus on our core role and establish it. Because from there we can be clear to government how we want them to institutionalise those relationships across different departments, whether that be through formal agreements between government and civil society, or whether it’s more informal regular consultation. By doing this we can make those relationships more productive on the core areas that we deliver far better than government for society.

All of this is not to say that in focusing on gaining cross-party consensus for the role of charities we should stop making the case for the right to campaign, advocate, and protest. The sector should absolutely continue to do this. Nor can we be naïve that this will probably continue to be the biggest source of tension with government, regardless of who is in power. But we do need to make sure this doesn’t continue to overshadow the other elements of a better, institutionalised relationship with government that recognises the core role of charities and can ensure that people across society get the help and support they need now.

Here at NPC, we want to do our bit to make this happen. Through our strong focus on better intelligence and data on what charities do that works to make people lives better, we want to help establish where the charity sector is better than public or private services and where it helps society in areas that other sectors just don’t function.

We want to use our independence to build a credible case for the core role of charities in society. Through our strong relationships with charities and funders, we want to work with the sector to help build a much more constructive relationship for the next 20 years and beyond.

We hope you found our 20th anniversary essays and interviews engaging and thought provoking. We’d love to hear what you think the future holds, and what you believe NPC should be focusing on. You can join the conversation using the hashtag #20yearsofNPC or through our events. As a charity ourselves we rely on the generosity of those who value our work to help us to continue to produce research and guidance to support the sector in maximising social impact. Visit the 20 years of NPC page to find out more. We’ll be discussing all of these themes at NPC Ignites – Book your ticket here.

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Thankyou to PwC for sponsoring our essay and interview collection.