Decline in public sector grants will damage people and communities, says Directory for Social Change

As Local Authorities finalise budgets, a new campaign calls for a halt to the decline in grant funding by public bodies to charities and community groups.

Available data on public sector grants shows that grants declined from £6 billion in 2003 to £2.2 billion in 2013, and are likely to have even declined further since then. If the decline continues at the current rate, grants will have all but disappeared by the next General Election, having been largely replaced by short-term, inflexible and bureaucratic contracts.

Debra Allcock-Tyler, Chief Executive of the Directory for Social Change, launched the campaign at the Charity Finance Group Community Accounting Conference. She said: “DSC has long expressed grave concerns about the rapid decline in grant funding from government for the voluntary sector.

"Grants are absolutely essential for charities and community groups because they can put people at the very centre of projects and services, allowing them to solve problems in their community.

"When local councils slash grants or dump them for hugely restrictive contracts they are simply shooting themselves in the foot. That isn’t a solution – it just means social problems will increase as vital services provided by charities deteriorate or collapse.

“This might seem like a curious time to launch this campaign – when we are staring down the barrel of more cuts and local government in particular is under huge financial pressure, but actually grants can be part of the solution. It’s high time to make the counter-argument and start campaigning for Grants for Good.”

Commenting on the launch of the campaign, Kathy Evans, Chief Executive of Children England, said: “Grants are more than just a sum of money to the charities and community groups that rely on them, they’re the lifeblood of thousands of local initiatives that families thrive on, from play schemes to employment support for disabled people.

"Where contracts tend to be short term and impose restrictive conditions on service delivery, grants empower people to deliver what works for their community – sustainably. We really can’t afford to lose them.”

Grants for Good is run by Directory for Social Change, Charity Finance Group, Children England and Lloyds Bank Foundation for England and Wales, who are using their networks to gather examples of effective grant-making and build a case for commissioners to choose grants instead of contracts where a responsive local service is needed.