Ahead of the #ARNOVA16 conference, authors Valerie Egdell and Matthew Dutton discuss third sector organisations’ struggle for independence and how this struggle affects the delivery of the various services that these organisations provide.
Government outsourcing of public services through competitive tendering has created significant new opportunities for third sector organisations to expand the range of actions they undertake but has also threatened their independence.
The third sector is a trusted partner because of its independence of purpose, voice and action. The third sector itself values its independence from political influence in representing the needs of service users. However, does the third sector’s role in the delivery of government funded services compromise its independence? Is the idea of an independent third sector still relevant?
“To survive, some third sector organisations have had to adapt to deliver services that are not core to their function”
An independent third sector can act as the voice of the vulnerable in society, ensuring that their views are incorporated into the democratic discourse. However, the independence of the third sector is under threat, in part, because of tough competitive tendering processes which are the principle mechanisms by which third sector organisations compete to deliver public services.
To survive, some third sector organisations have had to adapt to deliver services that are not core to their function but which enable them to compete for access to a wider range of funding arrangements. This leads to a process of mission drift that risks diluting their role as the independent voice of service users. The process of competitive tendering, although offering a degree of transparency and accountability, can also undermine the capacity of third sector organisations to design and deliver services in a way that meets the needs of service users by standardising services, limiting service innovation and stifling opportunities for co-design.
“Third sector organisations have had to choose between biting the hand that feeds them or providing a strong voice for service users.”
Threats to independence may also come from self-censorship. The importance of government contracts to the wellbeing of the third sector may inhibit public criticism of funders. There is a potential conflict of interest between being the recipient of government service contracts and the freedom to campaign and advocate for service users in a way that may require public criticism of government policy.
Third sector organisations have had to choose between biting the hand that feeds them or providing a strong voice for service users. A lack of funding to support campaigning activities and the recent ‘no advocacy’ clauses introduced under the Transparency of Lobbying, Non-party Campaigning and Trade Union Administration Act 2014 have both arguably ‘chilled’ the campaigning environment further. Given that many of the campaigning and advocacy activities of third sector organisations are driven by a need to provide an independent voice to service users, there are concerns that this will undermine the advocacy role of third sector organisations.
The sector is not however passive in the face of these threats. Organisations are seeking to diversify funding streams to become less reliant on the state. They are re-evaluating their values and purpose to ensure that the services they provide and the tenders they submit are aligned with their charitable principles – even if this means that there may be a financial hit in terms of lost funding opportunities. Potential threats to organisational independence also offer opportunities for third sector organisations to reassert their distinctiveness. Increased competition to deliver services can strengthen service quality and increase professionalisation in governance and service delivery.
“To retain an independent voice and purpose, the third sector must continue to act as a critical ally of government without compromising its advocacy role.”
So in answer to the question: Is the idea of an independent third sector still relevant? The sector is creatively contesting and resisting the threats to independence. However, the picture is complex as the ability to resist threats to independence may only be an option for those with financial power. The issues discussed here raise fundamental questions about relations between government, citizens and the third sector.
The third sector should continue to be involved in the delivery of services to people it knows well. The state cannot meet the complex needs of all groups and the out-sourcing of public services is well entrenched. But to retain an independent voice and purpose, the third sector must continue to act as a critical ally of government without compromising its advocacy role.
Valerie Egdell and Matthew Dutton are the authors of ‘Third sector independence: relations with the state in an age of austerity’, recently published in Voluntary Sector Review. The article is free to read 14-23 November 2016.
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