Common Concerns, Questions & Pushbacks

Of course, we want the voluntary sector to have access to as much funding as possible. However, that’s not primarily what Fair Funding is about. Although a minority of our asks would involve an increase to funding, such as the inclusion of inbuilt inflation-based uplifts, the vast majority would not. For us, Fair Funding is firstly about making what is already available more long-term, more flexible, more sustainable, and more accessible, and our asks – which include aspects such as decisions being made in a timely manner, funding being less restricted, and more consistency across approaches – would make the system more efficient for voluntary organisations, rather than costing more money. In fact, it could be argued that with a more efficient system as a result of Fair Funding, less capacity would be wasted by both the funded and funding organisations, and finances would be used more effectively.

As above, Fair Funding is largely about making the funding that is currently available fair. The vast majority of our asks could be implemented without an increase in funding.

The sector cannot wait any longer and amongst our series of asks are a number of aspects that could be implemented sooner rather than later. In addition, it should be highlighted that aspects of Fair Funding have been discussed and committed to since at least 2015. The Scottish Government has now committed to Fairer Funding by 2026 and so the opportunity is there to make that commitment as successful and as progressive as possible by aligning it with SCVO’s definition of Fair Funding, which has been developed through significant research and engagement with the voluntary sector.

Unfortunately, the funding of the voluntary sector has been plagued with a range of issues and barriers over many years, culminating in what has been described as the “worst year ever” for funding in 2023-24. As a result, it is near impossible to identify one or a handful of the most important aspects of our Fair Funding calls. The reality is that voluntary organisations are facing such an array of difficulties and concerns relating to their funding, that what could be the most important aspect of Fair Funding for one organisation may be completely different from another. It is, therefore, important that we avoid simply cherry-picking aspects that are more important based on opinion or assumption, and instead focus on delivering Fair Funding in its entirety. Despite this, one area where the Scottish Government could immediately alleviate the strain placed on voluntary sector funding would be to ensure timely decision-making, guaranteeing funding decisions are issued no later than December and funds paid no later than the start of the financial year in April. Far from being a radical proposal, this should be considered a basic expectation.

There is an ongoing lack of knowledge and understanding from some funders, including across the Scottish Government, about the funding needs of organisations and that is why Fair Funding is required – to give organisations the best possible chance of achieving their goals and producing the outcomes that are so valuable to communities across Scotland. For example, while funders can often provide funding that is ring-fenced for innovative new projects, we are often told by organisations that a lack of core funding prevents them from being in a stable position to then provide the kind of services and projects people need in the first place. The people who lead, work, and volunteer for voluntary organisations are those who have the knowledge and expertise to decide how their funding should be used. It is those people who have the skills and experience, as well as the dedication and passion, to best make the best decisions on the use of funding.

Obviously different funding streams will have slightly different approaches dependent on the different aspects and aims involved. However, there remains a problematic lack of consistency across Scottish Government funding streams that continues to cause serious issues for Scotland’s voluntary organisations, particularly those that receive funding from more than one team in government. We believe that all of our asks could be implemented, whilst also allowing the legroom for slight differences and variations where required, that do not impinge on our Fair Funding principles. Our calls are not about restricting grant-makers, instead they aim to free up voluntary organisations to do the fantastic, invaluable work that our communities need.

As the Scottish Third Sector Tracker Wave 1-6 report highlights, voluntary organisations – like organisations in other sectors – have adapted to the post-pandemic world, including developing approaches to hybrid working. As a result of adaptations, 18% of organisations have reported a positive impact on their organisation’s resource levels, predominantly by reducing costs. Resource costs (including non-financial costs) have decreased (for example, time savings, lower travel, and premises costs). However, such data simply emphasises that voluntary organisations are already doing what they can to cut costs and save money, while still urgently needing Fair Funding. Ultimately, the sector cannot be expected to budget itself out of structural problems that specifically relate to funding approaches and processes.

We understand that the nature of devolution complicates matters to some degree, including with regards to budgeting. However, there are examples of successful approaches to the funding of the voluntary sector in other devolved nations that undermine the credibility of this argument. For example, in April 2022 the Welsh Government announced it would be providing longer-term grants to the voluntary sector, ensuring that grant programmes starting from then on would have the option of running for an initial period of up to three years, with the possibility of being extended for a further three years on top of that. It seems fair to assume that, if the Welsh Government can provide voluntary sector funding of up to a total of six years under devolution, the Scottish Government can embrace multi-year funding, and other aspects of Fair Funding, too.