The third sector is a major social and economic actor

If anyone didn’t understand the value and importance of the third sector before Covid-19 they should do now. In those unprecedented times when normal life for most was suspended, the organisations and volunteers of the third sector stepped up and ensured those most in need were supported. And whether it was ensuring that families had food on the table, access to vital medicines or mental wellbeing support it was all delivered at pace and focussed on the needs of the community.

It was this crisis perhaps that truly brought the third sector into many more peoples’ consciousness. For the first time, many recognised the ecosystem of support that characterises the sector and how it is an absolute necessity, not just in times of crisis, but in all of our everyday lives. Recognising that crisis role is important but so too is recognising the sector as a major social and economic actor in recovery and beyond.

Making the most of that much bigger and broader contribution requires us to retain the best of those ways of working that were necessitated by the pandemic and go much further to extend and embed them. You’ve told us that means fair and sustainable funding, less bureaucracy, better engagement, and Scottish Government and other funders putting our trust in communities to determine what services are needed in their local area. In other words, the third sector must be an integral and valued partner with a seat at the table when crucial decisions are being made and not just in a crisis. To capture this learning we’re working with SCVO, COSLA and the TSI network via the long term Strengthening Collaboration commitment to fully understand and address the factors that create barriers for the third sector. We want to define and embed the changes that will enhance our collective contribution to Scotland’s communities socially and economically.

We are already seeing the seeds of this change begin to emerge through the Resource Spending Review Framework which was published in December 2021. The framework opens a national conversation about how we deliver effective services for the people of Scotland while maintaining sustainable public finances. It sets out an approach that will be outcomes-focused, evidence-informed and consultative, and hones in on our key priorities of supporting progress towards meeting our child poverty targets, addressing climate change and securing a stronger, fairer, greener economy. Overall, it provides an effective way to assess spending that will guide how we deploy Scotland’s public finances over this parliamentary term.

Our recovery from the pandemic also presents us with a unique opportunity in the choices we make about the kind of country we want to build. We must decide on the balance we want to strike between maximising economic growth and improving the wellbeing of our people and our planet. It is my view that Scotland must lead the way in becoming a prosperous nation that increases our economic and social wellbeing whilst fulfilling our commitment to reach net zero. As outlined in our recently published National Strategy for Economic Transformation, by 2032 we want to be a wellbeing economy, thriving across economic, social and environmental dimensions.

We want to be recognised as a nation of entrepreneurs and innovators, who have embraced the opportunities of new technology, boosted productivity and focused resources on innovations that have and will make a difference to our economy and our society. The third sector can play an increased role in realising this, and this is one of the reasons why I announced changes to social enterprise support at the national level. Led by Social Enterprise Scotland, social enterprises will have one representative body advocating on behalf of the full spectrum of the sector. From small community based organisations to larger more growth driven enterprises, we want to make the most of both the social impact and economic contribution that they make so that they can be a major contributor to a wellbeing economy.

We want to have a strong economy both in terms of economic performance and tackling structural economic inequalities. Our people will be at the very heart of an economy that works for all and where everybody, in every community and region of the country shares in our success. 

But to achieve this we must take a broader view of what it means to be a prosperous economy, society and country, moving beyond traditional attitudes and measures of growth, and ensuring that our economy puts our people and the environment at the heart of our economic activity.

The National Strategy for Economic Transformation sets out our commitment to take action to shift the dial in these areas, by doubling down on the things that are producing results and by working together to deliver bold action.

The third sector will have a crucial and multi-faceted role to play here, whether that is through social entrepreneurship, developing innovative approaches to service delivery, building skills that people will need at every stage of life or reorienting our economy towards wellbeing and fair work to deliver higher rates of employment and wage growth to significantly reduce structural inequality.

Every element of the third sector’s role in the economy resonates strongly with my own portfolio particularly given the potential impact of this economic transformation on child poverty.

Tackling child poverty is our National Mission and it will take all of us working together to deliver the change needed. Best Start, Bright Futures, our second tackling child poverty delivery plan published at the end of March sets out the bold and ambitious action that we will take together with partners across Scotland to provide the immediate support families need and to deliver sustainable progress toward achieving our child poverty targets in 2030. Tackling and reducing child poverty is critical to delivering our vision for a fairer and more prosperous Scotland, and actions set out in this plan provide an ambitious path to that future.

Over the past four years the considerable new support for families, embodied by the massive expansion of funded early learning and childcare, our devolved employment services and Scotland’s unique family benefits was delivered with the third sector as a key partner. Together with the wider action set out in Every Child, Every Chance, this has helped not only to deliver immediate improvements to families lives, but also to enhance the life-long outcomes of children and young people across the country.

Best Start, Bright Futures sets out how we will continue to partner with the third sector as we step up our immediate support to families, providing financial, practical and emotional support to help tackle and mitigate the impact of poverty, as well as preventing it. This includes a commitment to using the ongoing Resource Spending Review to provide multi-year funding for the third sector where possible to do so, enabling and empowering organisations to take action and support those in need with more sustainable, joined up strategic planning.   

To deliver sustained reductions in child poverty over the longer term, we will work with partners, including the third sector, to provide the integrated and holistic support parents need to enter quality employment, improve their wider wellbeing and engage with the drivers of poverty reduction. This will include a new £2 million Challenge Fund to test out news approaches to supporting parents into work, significantly increasing investment in our employment support services, providing up to £81 million in 2022-23 to support delivery of a new employability offer to parents, further developing our childcare offer for Scotland, working with employers to deliver high-quality opportunities for parents and focusing on delivery of a truly no-wrong door approach to public services.

The plan also builds on our £290 million package of cost of living measures by further increasing the Scottish Child Payment to £25 per week per child, once it is rolled out in full for children aged 6-15, and working with our local authorities to mitigate the Benefit Cap to the greatest extent possible.

We recognise that the change needed cannot be achieved by simply scaling existing supports. The 2030 targets require us to work differently – placing an ever greater focus on families and the places they live. Through phased approaches to change, working in a small number of localities, we can identify the barriers to progress and the keys to removing these for families and partners.

To sum up, the pandemic brought into sharp focus the value of the third sector in times of crisis.  But the pandemic also showed the need for sustainable change if we are to truly build a prosperous and fair Scotland. As a government we will therefore lead the way, focusing on how we can enable change through collaboration with a third sector recognised for its significant economic and social impact now and into the future.