The Scottish Council for Voluntary Organisations is the membership organisation for Scotland's charities, voluntary organisations and social enterprises. Charity registered in Scotland SC003558. Registered office Mansfield Traquair Centre, 15 Mansfield Place, Edinburgh EH3 6BB.
Part A: The funding challenges that voluntary sector intermediaries face
The complexity and diversity of Scotland’s voluntary sector raises difficulties in summarising the big issues and challenges faced by voluntary sector intermediaries that cover so many areas of public life. However, some clear themes surfaced during SCVO’s interviews with senior leaders of voluntary sector intermediaries, with the main challenges being that of year-to-year funding, untimely decision making and payments, static levels of funding, inconsistent relationships, and a lack of flexibility. This section details what senior leaders said on the funding challenges their organisations face.
Year to year funding
Most voluntary sector intermediaries interviewed face an annual cycle of uncertainty when it comes to the funding they receive from the Scottish Government. This short-term public funding creates a situation where organisations can struggle to deliver projects and plan their workforces. Not only this, but organisations are wasting resources by chasing short and repetitive funding cycles.
Where organisations are receiving ‘multi-year funding,’ this is usually rolling annual funding based on annual decision-making. This is a difficult situation for both leaders and their staff, and for all the talk around moving to longer-term funding, adequate progress is clearly not being made across the whole or indeed most directorates of the Scottish Government.
Voluntary organisations said:
Untimely decision making and payments
A key element of the annual uncertainty caused by year-to-year funding is the time that those organisations interviewed must wait to learn whether their funding will be continued next year. They are left only to assume it will. The lack of straightforward and timely processes in decision-making by the Scottish Government presents a significant barrier to the planning and delivery of projects and services and supporting the workforce.
When decisions relating to funding are made, this can often slip into the new financial year. Organisations must chase the Scottish Government for decisions, and they feel as though it is a constant battle to secure a timely decision. Even when a decision is made, organisations are often left waiting months for the payment of funds to reach their accounts, meaning that those unable to dip into their reserves or other income sources are left in extreme difficulty.
Voluntary organisations said:
Static levels of funding
Voluntary organisations interviewed explained that they often do not see any adjustments for inflation, making it challenging to meet cost-of-living increases and rising costs while being expected to deliver the same services or more with static funding. Many of those interviewed have received the same level of funding for many years, in some cases five or six. Concerns are taken onboard by the Scottish Government, but this often does not result in any meaningful change.
These voluntary organisations face a unique challenge in the sense that they do not want to pull money away from those organisations they represent. They recognise that in most cases, the entire sub-sectors they operate in are underfunded, and the challenges they encounter are often similar to those of their members. While core funding from the Scottish Government is extremely appreciated, a significant challenge is securing core funding from other sources, meaning adequate government funding is even more essential.
Voluntary organisations said:
Inconsistent relationships
Those interviewed explained how important relationships with the Scottish Government are and that in many cases these are positive. Unfortunately, this does not always translate into the funding experience. There is also a fine line when being a critical friend given the annual uncertainty surrounding vital funding from the Scottish Government.
Voluntary organisations said:
A lack of flexibility
Those interviewed stressed the importance of unrestricted core funding for voluntary organisations as opposed to funding often restricted to specific projects and outcomes. Unrestricted funding would enable them to feel more secure and plan for the long term while responding quickly to a changing environment, as we have seen during the pandemic.