Consultation response to Labour National Policy Forum: Fair Work and the voluntary sector

Summary  

Labour has recognised the need to support civil society to make an impact. The Scottish Council for Voluntary Organisations (SCVO) welcomes this recognition.  

To support civil society, our workforce, and the people and communities we work with, Fair Work for Scotland’s voluntary sector workforce should be a priority.  

Labour’s New Deal for Working People and manifesto for the UK General Election should commit to: 

• Raising both the national living wage and the national minimum wage to at least the Living Wage Foundation’s independently calculated real Living Wage in the first Budget of a Labour government. 

• Annual increases to wages in line with those calculated by the Living Wage Foundation. 

• Annual increases to grant funding, contracts, and Scottish Government funding that accommodate these increases. 

A Labour government should also use its public buying power and public contracts to tackle in work poverty, champion fair funding, and promote Fair Work practices across all sectors, voluntary, public, and private. 

Key Stats 

• The cost-of-living crisis will continue to increase demand for voluntary organisations’ essential services. 58% of organisations in Scotland have reported that demand for their support has increased since August. 

• Voluntary organisations are struggling with a running costs crisis as energy and other costs increase and organisations seek to pay their staff fairly. 93% of organisations in Scotland have reported cost increases. 

• As the cost-of-living crisis worsens, Fair Work for the voluntary sector workforce, including payment of the real Living Wage, must be a priority. 67% of voluntary organisations in Scotland are struggling with staffing issues and shortages. 

• Fair Work and a Living Wage would also support people and communities that rely on voluntary sector services and support. 

Context 

Scotland’s voluntary sector is a major employer, employing over 135,000 people - 5% of Scotland’s workforce and a third more people than the 100,000 staff employed in Scotland’s digital and technology sector. 

This workforce makes a huge contribution to people and communities across Scotland, providing a diverse range of essential services and support including; childcare, social care, emergency support, support into employment, housing, and towards digital inclusion, and a huge range of advice services. The sector also undertakes vital medical and environmental research, runs most of Scotland’s theatres, museums, galleries, and sports clubs, and campaigns for change on a huge variety of issues. 

Like people across Scotland, voluntary sector staff are struggling as inflation reaches record highs, creating a cost-of-living crisis. The voluntary sector workforce includes more women (64.5%), more part-time workers (37%), and more people with a disability (23%) than the public and private sectors. Women and people with a disability are at greater risk of living in poverty, an inequality that the Poverty Alliance found deepened during the pandemic. 

Fair Work for the Scottish voluntary sector’s workforce, including payment of the real Living Wage, must be a priority. 

The Problem 

The Living Wage Foundation report, All Work and Low Pay, found that 12.5% of jobs in the voluntary sector in Scotland pay below the real Living Wage.  

After years of underfunding and upheaval, the pandemic and cost-of-living crisis are the latest chapters in a longer story of instability and unpredictability in voluntary sector funding. 

In SCVO’s research, many organisations reported receiving no increase in local or national government funding for over ten years. One organisation reported no uplift for 13 years, a 27% cut in real terms. 67% of voluntary organisations in Scotland are struggling with staffing issues and shortages. When the public sector and other funders do not uplift grants and contracts to keep pace with inflation, voluntary organisation struggle to find alternative resources. Rising inflation and the resulting cost-of-living crisis exacerbate this issue, significantly impacting recruitment and retention.  

Similarly, annual funding and delays in communications and payments creates an uncertain environment where voluntary organisations must frequently issue redundancy notices, particularly at the end of the financial year, when delayed decision-making from government and other funders creates further unnecessary uncertainty, impacting organisations, their staff, volunteers and the communities they work with. 

The voluntary sector workforce makes a huge contribution across Scotland, offering a lifeline to people, families, and communities as the cost-of-living crisis bites. This lifeline should not need to be extended to voluntary sector staff.  

Solutions 

Inflation-based uplifts to grant funding, contracts, and Scottish Government funding is one route through which a Labour government could foster a sustainable environment for Scotland’s voluntary sector. 

However, SCVO believes that a Labour government should go further. 

Fair funding, including longer-term funding and timely processes and payments, is central to supporting voluntary organisations to provide Fair Work. The certainty offered by fair funding enables voluntary organisations to offer job and financial security, supporting organisations to recruit and retain our vital staff and volunteers.  

SCVO welcomes Labour’s aspirations to end in-work poverty and create a New Deal for Working People. Labour can support our sector by championing Fair Work. The real Living Wage is central to Fair Work. 

The Labour Party should commit to: 

• Raising both the national living wage and the national minimum wage to at least the Living Wage Foundation’s independently calculated real Living Wage in the first Budget of a Labour government. 
• Annual increases to wages in line with those calculated by the Living Wage Foundation. 
• Annual increases to grant funding, contracts, and Scottish Government funding that accommodate these increases. 
• Using public buying power and public contracts to tackle in work poverty, champion fair funding, and promote Fair Work practices across all sectors. 

These actions will support a more sustainable voluntary sector which can survive the running costs crisis, support people through the cost-of-living crisis, offer Fair Work, and deliver quality outcomes, for our workforce, our volunteers, and the people and communities we work with.   

Testimonials 

“We want to look after our staff and provide cost of living increases to their wages to ensure they can continue to work for us and aren’t too stressed.”  

Medium voluntary sector organisation  

“Funding issues ensure that no one has security of employment. Sustainability for voluntary sector organisations is fundamental to progressing positive change in our communities and in employment security”.  

Social enterprise  

“Our income from the Scottish Government hasn’t changed over the past five of six years. It means that staff have received no pay rises in that time to meet the changing costs they face.”  

Voluntary sector intermediary