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The presentation was a workshop at Evolve 2014: the annual event for the voluntary sector in London on Monday 16 June 2014. The presentation was chaired by Anna Bloch from Charity Finance Group and shares highlights of how charities have adapted and are continuing to adapt to the climate, covering reductions in statutory funding and new fundraising strategies. Find out more about the Evolve Conference from NCVO: http://www.ncvo.org.uk/training-and-events/evolve-conference Find out more about the work NCVO does around funding: http://www.ncvo.org.uk/practical-support/funding
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Wo
rksh
op
s AM7: Managing in the new normal
Chair:
Anna Bloch, Acting Senior Policy Officer, CFG
Speakers:
Ian Oakley Smith, Head of Charities, PwC
Daniel Fluskey, Head of Policy and Research, Institute of Fundraising
Paul Streets OBE, Chief Executive, Lloyds Banking Foundation
Thomas Leftwich, Senior Policy Advisor, The Office for Civil Society
Managing in the New NormalHighlights of 2014 survey16 June 2014
www.pwc.co.uk
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PwC
Who I am
• PwC Head of Charities• Chartered accountant and Licensed Insolvency
Practitioner• Specialist in strategy and restructuring for charities
and other not-for-profit entities• Worked with wide range of charities and social
enterprises, typically small to mid-sized charities • A member of the Committee of the ICAEW Charities
and Voluntary Sector Special Interest Group• A member of the Governance and Audit Committee,
The Lord’s Taverners, a charity
Ian Oakley SmithUK Head of Charities
PwC
Some key messages
A “cautious optimism”
1
Concern about scrutiny
2
Greater collaborative working
3
Continued innovation in fundraising
5
Tips for a sustainable recovery
6
Slow interest in social investment
4
PwC
A cautious optimism?
Survey dated
Dec 08
Jun 09 Dec 09
Jun 10 Dec 11
Dec 12
77%93% 68% ??%
46% 55%
PwC
Under the microscope: increased scrutiny for charities?
90%
87%
22%49%
PwC
A greater collaboration
• 77% of respondents have collaborated or are thinking of it, compared with 69% last year
• Service delivery
• Joint fundraising
• Policy research or campaigning
• 90% consider greater involvement of finance teams in strategy
Slide 7PwC
PwC
Still no real appetite for social investment…?
Slide 8
PwC
More innovation in fundraising
Slide 9
PwC
Our top tips for a sustainable recovery
Slide 10PwC
Information
Strategy and fundraising
Saying “no”
OptionsScenarios
CashReserves
Governance
People
1 2 3
4 5 6
7 8 9
Managing in the New Normal
Paul StreetsCEO, Lloyds Bank Foundation
12
13
Our new strategy
14
Our new focus
15
ENHANCE A grants plus model - offering an optional range of support to strengthen
the effectiveness of those we fund
What’s available? - 3 programmes
16
The Challenge
17Source: ACF Giving Trends Top 300
Foundations 2014 Report
Giving Trends
18
Source: ACF Giving Trends Top 300
Foundations 2014 Report
Giving Trends
19
FOUNDATION
LOCAL AUTHORITY
NATIONAL LOCAL COMMUNITY
The Issue
• Quality wins over quantity. Take the time to get fewer applications right, rather than sending many in the hope that one may get noticed.
• Know your grant-maker. Also known as ‘do your homework’. If you know what the grant maker is looking for, you’re more likely to get their attention.
• People and ideas win grants. Ultimately, the strength of your application comes from the strength of the idea and the people behind it.
• Honesty beyond necessity. Don’t be afraid to consider and talk about what could go wrong and is going wrong.
• Make sure grants are only part of your income mix. Also known as ‘don’t put all your eggs in basket’. Relying too heavily on any one source of funding is an easy and common mistake to make.
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Our advice to charities is:
Source: Inside the Mind of a Grant Maker, nfp synergy
21
Consultation on a Proposed Sustainability Fund
Thomas Leftwich – Senior Policy Advisor , Sector Sustainability Programmes
CFG Evolve Event – 16 June 2014
Office for Civil SocietyThe Office for Civil Society (OCS), sits within the Government Innovation Group and is part of the Cabinet Office.
Set up in May 2010 to support the voluntary and community sector and to deliver key government programmes, working across Government.
• Approx 75 staff
• Reports to Nick Hurd MP, Minister for Civil Society
OCS key objectives:
• Make it easier to run a voluntary or community sector organisation
• Get more resources into the sector to underpin its resilience and independence
• Make it easier to do business with the state
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The Narrative for the FundAnalysis of engagement with stakeholders and learning from past and current programmes has resulted in the development of an emerging narrative. This narrative broadly follows the following three stages:
The following slides explore each of these three stages of the narrative in more depth.
.
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A changing environme
nt
•The environment in which organisations are operating is changing. Changes to our society, the economy and Government policy, have created both opportunities and pressures for the VCSE sector
Where do we
want to
be?
• It is in all our interests for the VCSE sector to include a diverse range of organisations, delivering high quality services for those most in-need in our society.
•To achieve this organisations need to be robust and resilient, able to understand the best route to sustainability and have the resources and capability to follow it.
Overcoming
the barrie
rs
•Organisations need to understand how they need to change, be able to plan effectively for the future and deliver necessary change.
•However, many small to medium sized (SME) organisations struggle to do this whilst also reacting to the immediate challenges they face. This fund can work to provide these organisations with the support they need in order to realise the vision.
• Support to deal with funding cuts through the Transition Fund
• Growing the Social Investment market:• Establishing Big Society Capital• The Investment and Contract
Readiness fund • The planned market development
foundation• Reforming support for the sector
through Transforming Local Infrastructure • Opening up public services to the
sector:• Working with commissioners • Introducing the Social Value Act
• Supporting innovation in, and scaling up, social action:
• The Innovation in Giving Fund• The Social Action Fund• The Centre for Social Action
• Making it easier to run a VCSE organisation by cutting red tape
The environment in which the sector is operating is changing
25
• Need for new skills and capability• Increasing demand for services• Capacity limitations resulting from increased demand• Funding cuts and changes• Opportunities to deliver public services• Greater competition for existing grants and contracts• Increasing overhead costs• Growing expectation to demonstrate evidence of impact
From Government:• Continued spending restraint• Welfare reforms• Local authorities switching grants to
contracts• Focus on growth• Reforms to commissioning
Wider Society• Effects of budget cuts and welfare reforms• Aging population• A more diverse population• Increasing use of digital
A changing environment
Evolving pressures and opportunities for the sector
A changing operating
environment
A range of support and strategies
4. What does the sector need to take the right pathway?
2. What is needed to
achieve this?
1. Where do we need to
be?
3. What are the pathways for the sector?
Our vision is that the fund will help to secure a diverse range of organisations delivering high quality support for those in-need
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A diverse range of organisations delivering positive outcomes for some of the most
vulnerable and disadvantaged in society
Maintain core services by restructuring and reducing
costs
Generate income through trading/establishing paid
for servicesDeliver public services
Robust adaptable business models and clear forward
plans
Access to appropriate sources of external
support and expertise
An appropriate skills base in both executive staff and
trustees
Access to appropriate funding to resource
change
The journey to sustainability for struggling organisations requires a series of stages. However, this can be difficult for medium sized organisations lacking resource
27
i. Awareness: An organisation needs to be aware that its operating environment is changing
ii. Understanding: An organisation needs to understand what this change means for them, and that they need to change too
iii. Planning: An organisation needs to plan to deliver change
iv. Delivery: An organisation needs to deliver necessary change
v. Learning: An organisation needs to understand the impact of delivery and share learning
Expertise to carry out needs analysis and forward planning
Funding to free up capacity to deliver change or deliver necessary action
Therefore a potential aim for the fund could be : To identify voluntary sector organisations delivering vital services to vulnerable people in our communities, but struggling to adapt to their changing environment, and put them on the right pathway to securing the long term future of their services.
Funding to free up capacity to engage in planning
Expertise to enable delivery of specific actions
This fund could support small to medium sized organisations on this journey by providing:
• The Consultation launched recently and will run for 12 weeks until the 24 July.
• The intention is for this to be a co-design consultation around the key themes and challenges identified. This will not involve simply proposing a complete fund design and inviting feedback. The responses received will be used to formulate a fund design.
• The consultation will invite active engagement. Advice received has highlighted the need to combine both online and face to face.
The Consultation can be accessed at:
www.gov.uk/government/consultations/new-fund-to-help-vcse-organisations-become-more-sustainable
Queries and comments on the consulation can be sent to:
An Active and Open Consultation
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Timetable• Gain approval for consultation
document April
• Launch consultationLate April
• Active consultationJune – July
• Analysis of responses and establishing fund designJuly
• Gain full business case approvals• Commence sector awareness raisingLate summer
• Identify delivery partner/s and finalise application designAutumn
• Fund launched for applicationsDec
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The following is a high level forward timetable for the fund development. This timetable is indicative at this stage and depends on the nature of final fund design established through consultation.
Plan
Consult
Design
Deliver
Excellent fundraising for a better world
Managing in the new normal – fundraising
Daniel Fluskey, Head of Policy and Research
Excellent fundraising for a better world
A familiar scenario?
Charity wants to do more and increase services
Can only increase service if have
resource to fund it
Resource needs to
be sustainable
Investment and growth
for fundraising
Growing need /
demand for service
Excellent fundraising for a better world
Putting it into context
• Latest information available: 2011/12
- Voluntary sector saw a net real-terms fall in its total income of £700m
- Income from government fell by £1.3bn (with more to come)
- Income from individuals is the biggest source of income for the sector, rising by over £500m from 2010/11 and 2011/12
- Value of reserves fell by almost £2bn
Excellent fundraising for a better world
Future fundraising environment
Excellent fundraising for a better world
Fundraising challenges
Excellent fundraising for a better world
How are charities responding?
Excellent fundraising for a better world
The new normal for fundraising• There will be more fundraising!
• Developing new fundraising activity and getting good return on investment will be challenging (it always was and always will be)
• Everything will change, and everything will stay the same
• Skills, experience, and expertise in fundraising will be in demand
• Investment for fundraising needs a clear and planned ‘whole organisation’ approach – the numbers DON’T tell the full story
• External challenges (transparency, scrutiny) and ethical questions will need to be addressed by all organisations
Excellent fundraising for a better world
More information
• Introductory videos http://www.institute-of-fundraising.org.uk/guidance/five-minute-fundraiser/
• Code of Practice http://www.institute-of-fundraising.org.uk/guidance/code-of-fundraising-practice/
Contact me: [email protected]
Evolve 2014
