A new report shows why ‘the Big Society’ won’t really work


4:26 pm - December 19th 2010

by Richard Exell    


      Share on Tumblr

A major new survey shows that the recession has increased the demand for charities’ services at the same time as the cuts and the increase in VAT will make it harder for charities to provide those services.

The survey found that:

not only will the sector be hit by departmental spending cuts, but also by decreases in other sources of income. This is largely due to market forces and decreases in the general public’s disposable income. We expect that the cuts, particularly those to welfare, will increase demand for services, causing further pressure for charities to meet beneficiaries’ needs.


The survey, the fourth report in a series by the Charity Finance Directors’ Group, the Institute of Fundraising and PwC was carried out in August. The report, Managing in a Downturn: responding to life after the Comprehensive Spending Review, was published last week. Charities will be hurt by the cuts in benefits and tax credits and the 330,000 public sector redundancies. The Departmental cuts will hit hard, because important Departments that provide statutory funding for charities are taking bigger hits than the average.

The average Departmental cut will be 19 per cent, but in Culture, Media and Sport it will be 24 per cent and in Communities and Local Government 36 per cent. The local government cuts are already leading to cuts in local authorities’ grants to charities – the report cites the example of Sheffield, where funding for voluntary organisations has been cut by 15 per cent.

The cuts, below inflation pay rises and households struggling to pay off debt will all feed through to lower incomes for charities. In addition, one third of charities expect the VAT increase to have a ‘major’ or ‘considerable’ effect on them.

The government essentially has two arguments to defend the cuts. One is that front line services won’t be affected, because “after thirteen years of Labour, there is a lot of wasteful spending, a lot of money that doesn’t reach the frontline.” The Sheffield example suggests that isn’t the case.

The other is that the Big Society will fill the gaps – precisely the sort of work that charities do. And that is happening already: the survey reveals that 39 per cent of charities say they have seen an increase in demand for their services due to the recession.

But 31 per cent of charities getting statutory funding say that one of the ways they will address the shortfall in public spending is by cutting back services. (For those that do not get such funding the figure is even higher – 40 per cent.)

Mr Cameron seems to believe that the cuts will open up space for the ‘little platoons’ to fill the gap. It’s rather analogous to Mr Osborne’s belief that the public sector is ‘crowding out’ private sector investment. And equally mistaken – the cuts are the enemy of the Big Society, not its friend.

    Share on Tumblr   submit to reddit  


About the author
Richard is an regular contributor. He is the TUC’s Senior Policy Officer covering social security, tax credits and labour market issues.
· Other posts by


Story Filed Under: Blog ,Fight the cuts ,Our democracy

Sorry, the comment form is closed at this time.


Reader comments


Yep. The real ‘big society’ would be set up by Greens or other lefties aiming to mobilise civil society by investment, not cuts.

The BC is nothing more than a live idealogical experiment being played out right in front of us. The plan is that there is no plan? If we strip everything back then something will eventually fill the gap and fingers crossed it will turn out ok.

“A key member of David Cameron’s inner circle was at the centre of controversy tonight after he was filmed stating that the prime minister and his deputy, Nick Clegg, want their “people power” revolution to unleash “chaotic” effects across local communities.

Boles replied that he, Cameron and Clegg did not believe in central planning and that it would be a good thing to have different communities offering differing types of services, even if the appearance was chaotic.
“I mean, bluntly, there comes a question in life,” he told the audience. “Do you believe planning works? That clever people sitting in a room can plan how people’s communities should develop, or do you believe it can’t work? I believe it can’t work, David Cameron believes it can’t, Nick Clegg believes it can’t. Chaotic therefore in our vocabulary is a good thing.”

If you look what is happening in all other areas of government we are charging blindly into the unknown which is totally capricious and it would appear without a plan B. If this experiment doesn’t work then we really will have chaos.

3. Chaise Guevara

@ 2

I think that, if anything, you’re giving it too much credit by calling it an experiment. It’s not, it’s a euphemism. It’s laissez-faire wearing cool sunglasses.

It is a busy bodies charter.

Charities that accept taxpayer funding are not real charities. The BS idea is not about different people doing the same things as before it is about different people doing different things. It is about us all taking responsibility for each other.

The fact that people sneer even at the possibility this might happen merely demonstrates how distorted our society’s values have become. Such a view is fundamentally misanthropic and I don’t share it.

Clearly, the Big Society will only work if Government funds charities more. There’s obviously no possible way of fostering a more philanthropic, giving, culture in Britain. The bloody plebs will never give their cash, or more importantly time, to charity.

In fact the only way for there to be a Big Society is for Government to take over all these pesky charities’ services themselves and stick up taxes to pay for it. It’s the only way we can have that more community-focused society those baby-eating Tories claim they want. If they claim otherwise they’re clearly lying as I’ve just proved by facts and stuff that greater Government intervention is the only way.

#FAIL

7. Chaise Guevara

@ 5 Pagar

“The BS idea is not about different people doing the same things as before it is about different people doing different things. It is about us all taking responsibility for each other.

The fact that people sneer even at the possibility this might happen merely demonstrates how distorted our society’s values have become. Such a view is fundamentally misanthropic and I don’t share it.”

I’m sorry, but that’s a complete misrepresentation. It would be misanthropic to think that people are always selfish. It’s realistic to think that people are sometimes selfish and sometimes kind, and that the needle won’t swing massively towards “kind” just because Cameron thinks it would be jolly nice if it did.

The problem with the Big Society is that it follows this formula:

1) We cut public services
2) ????
3) Everything’s ok again (or, indeed: profit!)

Unless Cameron can somehow convince the people to rise up in huge numbers and start dedicating hours to helping their fellow man, I don’t see how he intends to plug the gap in the formula. I also doubt that he cares.

8. Chaise Guevara

@ 6 Parasite

“There’s obviously no possible way of fostering a more philanthropic, giving, culture in Britain.”

Two questions:

What is your suggestion for a way to foster this culture?

Which Conservative policies do you think are working towards this goal?

For an excellent critique of the big society and how labour should respond read below at the new statesman;

The Big Society: the Anatomy of the New Politics
By Jesse Norman
Reviewed by Jon Cruddas and Jonathan Rutherford – 15 December 2010
Print versionEmail a friendListenRSS

@8. Lower taxes help. The diminution of that peculiarly British idea that there’s this massive welfare state at the back of everyone, that will act as a munificent mother for all time, rather than as the Churchillian (and Beveridge-ite) safety net until people are back on their feet, will help.

A changed culture towards greater giving to charity helps but, as I hope you might have noticed from my attitude towards charity funding, I believe it’s for society to itself change such a culture rather than for Government to make people do it, so in answer to your question “There is nothing to be done to foster this culture except what people will do themselves.”

I remember reading somewhere that Americans give, on average, over double their GDP in charity than Britons. I don’t wish us ape the States, but on this point they are to be commended.

And to get back to the substantive point of the post, it is depressing, when the Government is trying to encourage charities to take up their proper role in civic society with gusto, to read articles from the Left basically saying “Can’t be done” on the basis that the Government’s agenda is centre-right (oh, sorry, “quasi fascist-worse than Thatcher-brownshirt butler troll” – take your pick) and greater tax and spend is the only way out of, er, um, dependency on Government.

The are many unanswered questions about all this – not least the pertinent and timely questions put by Chaise Guevara @8 above.

Did Britain ever have a Big Society and, if so, when exactly was that?

Are there other countries with Big Societies now we might emulate, such as Denmark?

The latest disturbing news about Denmark, it that along with New Zealand and Singapore, it came out top on Transparency International’s Perceived Corruption Index (PCI) for 2010 – meaning that the three countries were perceived as being the least corrupt among the 178 countries assessed: http://transparency.org/news_room/latest_news/press_releases/2010/2010_10_26_cpi2010_en

Meanwhile, Britain’s rank has slipped to 20 on this latest assessment by Transparency International.

Readers may recall a previous post of mine worrying about the state of Denmark:

Denmark has been confirmed as the OECD’s highest-tax country, followed by Sweden. By reports, Denmark’s Gini co-efficient shows it to have the least inequality of post-tax income distribution among countries for which income distribution data are available :
http://en.wikipedia.org/wiki/List_of_countries_by_income_equality

Strangely, according to Eurostat data, Denmark is not therefore languishing as an impoverished failed-state or even in the lengthening queue applying for EU bailouts, indeed it comes out as one of the most affluent countries in the EU even if it isn’t in the Eurozone. By other assessments, it also appears that Denmark is the ‘happiest place on earth’:
http://news.bbc.co.uk/1/hi/5224306.stm

What can be wrong?

12. Chaise Guevara

@ 10 Parasite

“@8. Lower taxes help. The diminution of that peculiarly British idea that there’s this massive welfare state at the back of everyone, that will act as a munificent mother for all time, rather than as the Churchillian (and Beveridge-ite) safety net until people are back on their feet, will help. ”

If you let people keep more of their money they’ll give more to charity. Sure. But they’re not likely to give the entire difference to charity, so inevitably you’ll end up with less. People also tend to give to oversubscribed animal charities and the like while other people suffer, because it’s not Joe Blogg’s job to work out how the money can be most effectively used.

As for scaling back the welfare state: you’re basically saying we should get people to fix a problem by making that problem worse. Counterintuitive to say the least (and something that, if I were the Tory party, I would call a “tax on the generous”).

“A changed culture towards greater giving to charity helps but, as I hope you might have noticed from my attitude towards charity funding, I believe it’s for society to itself change such a culture rather than for Government to make people do it”

Ok, but there you’re not defending the effectiveness of the Big Society, you’re saying you like what the Big Society is, i.e. a swing towards libertarian economics. Whatever floats your boat, of course, but it’s not the same as convincing people that the BS will somehow fill the gap left by cuts.

“And to get back to the substantive point of the post, it is depressing, when the Government is trying to encourage charities to take up their proper role in civic society with gusto, to read articles from the Left basically saying “Can’t be done” on the basis that the Government’s agenda is centre-right (oh, sorry, “quasi fascist-worse than Thatcher-brownshirt butler troll” – take your pick) and greater tax and spend is the only way out of, er, um, dependency on Government.”

Charities already contain many people giving up their time to help those who need helping; what’s so wrong with that role that they need to take up a “proper” one instead? And your last point is oversimplistic: you can give people government support in specific cases, or early in their lives (education being the obvious example) that helps them in the long run to be more independent. You fund my business degree, I set up a small enterprise and become an independent net contributer.

The Big Society is bollocks, but we know that already.

In my county the country council decided about a year ago that its nursing homes were too costly to run. They said that the buildings were 30 years out of date and as a consequence the cost of keeping a person in one of those homes was more than in the private sector. OK so say I accept that argument, that the private sector is cheaper because the facilities in the county nursing homes are out of date, it still does not explain *why* the council hadn’t invested over the last 30 years. Anyway the plan was to close all the county homes down.

Now it seems that there are people willing to run these nursing homes as “social enterprises”. I met one of these people last week. She was somewhat concerned because she had just sat through a speech I had given where I said that using social enterprises to provide public services was nothing better than privatisation. In fact, I think it is quite a bit worse.

Look at the facts. The council want to spend the same, or preferably less on that social care. They know (I’ve seen the figures) that local private nursing homes can do that, those companies have put in the investment over the last 30 years (unlike the council). The council claim (and I have no proof whether this is true) that the nursing homes in their current condition cannot provide the care at the price they want. The people taking over the nursing home will have to purchase the asset, then find the money to upgrade the property to modern standards. That is a lot of money to find. They will also have to employ staff. They would have to do this all for less than an existing private sector nursing home. I just don’t see it happening.

The other reason why I am so cynical about this scheme is that the local Tory MP is enthusiastically behind it.

@10

“when the Government is trying to encourage charities to take up their proper role in civic society with gusto”

The problem with this attitude is that, essentially, this was tried in the 19th century. The result was that charities were underfunded and overstretched and poverty was rife. The wealthiest part of society donated money and then moved on feeling they’d done their moral duty. The problem was they hadn’t given anything like enough as a proportion of their income and the money often went to the wrong places, with fashionable causes taking the lion’s share.

Everyone who spends time bashing the welfare state should take a look at what society was like before the welfare state existed and think about whether we really want to return to that state.

15. DisgustedOfTunbridgeWells

This is half the struggle with liberals, they can never tell the difference between a feature and a bug.

“Charities that accept taxpayer funding are not real charities”

I realise where you’re coming from regarding charities that are essentially public sector orgs initiated by govts for PR reasons, but by and large there is nothing illegal or wrong about registered charities accepting government funding via grants or contracts. In the strict legal sense then, you are wrong. You can be a charity, accept taxpayer money, and still remain a registered charity.

In the ethical sense does this compromise the work you do? This has been debated numerous times at conferences and in third sector publications over the years, and the general conclusion is no, provided you have a variety of income sources and the government money was received through an open process.

Think about this way, if you ran a small cleaning business specialising in cleaning offices, and won a contract to clean the offices of the local authority, then you’d still be private sector wouldn’t you?

It’s also worth pointing out much of the increase in state funding for charities has its origins in the thatcher years, where services were outsourced and delivery mechanisms changed. It is essentially a right wing idea. If a charity can do the work better than a local authority, why not fund them to do it?

What happened under labour was that the opportunities to win contracts and grants expanded, and there was more money available. They also invested in charity infrastructure, so that charities had people capable of writing bids and tenders, and were thus capable of competing with the private sector. Also, for contracts, charities are able to make a profit on them if they delivered the service in an efficient manner, and hence contracts could also be used to subsidise the rest of the charity.

Indeed charities became so successful in delivering services, and adding value to the state, that you see the origins of the big society idea. Cameron genuinely sees them as useful tools to deliver services in a more efficient manner than the public sector, thus furthering the long term conservative goal of lower taxes. He also probably sees them as more entrepreneurial and innovative than the public sector.

What he has failed to understand is that by cutting spending so drastically, the opportunities to win contracts or grants is drastically reduced. Local authorities and central government will find it far easier to just not renew a contract, or end a grant than they will to achieve internal efficiency reform or cut the pay of senior management. Hence the third sector will be the low hanging fruit. Secondly this will have the knock on effect on reducing the effectiveness of charities in operating non state funded activities, as key backroom staff leave, and resources that were shared become lost. Finally, he forgets that the private sector already makes billions from outsourcing, and will be in far better position to chase the remaining opportunities for contracts than overworked charities, even though the services will remain crap as a result. Private companies use contracts to make profits, and thus deliver the tesco value service. Charities use them to further the goals of their organisation, deliver the services in a manner that treats their clients as human, and deliver a far greater social return – they are the marks and spencer service. Even if they are slightly more expensive, they are still the better option – yet tories have never grasped that sometimes you have to pay more for a better service. Indeed they seem to think all public services should be the lidl service – somewhere you go only when you are desperate

@5

I think that every critic of Cameron’s idea will henceforth have an awful lot of trouble not thinking of it as “The BS”, and having a little snigger to themselves at how apt the acronym is.

Parasite @ 10

Lower taxes help.

Er, how exactly? From what I have read regarding Cameron’s BS, expects us all to donate ‘time and energy’ to help society.

It seems rather odd for people who tell us that ‘pumping more money’ into every problem is not the solution to society’s ills that they seem to drag up money all the time.

Why is this? Why is it that when the Tories talk about ‘the big society’ you then follow that up demanding tax cuts for the rich? Surely if we need people to volunteer to run a hospice or a local bus service, for example, then what is stopping people doing that right now? In fact, I was out shopping today and people were bag packing whilst collecting for a children’s cancer charity without the need for a tax cut, so why are the Tory vermin so special? Why is that millions of decent, normal people can provide time, energy and money to charity, yet the Tory vermin could only be persuaded to give to charity if they receive massive tax cuts first?

If there are plenty of issues that you feel that could benefit from the ‘big society’ then what the fuck is stopping you?

@ Planeshift

The problem is that when charities accept taxpayers funds to carry out public functions they prostitute themselves and become, to a greater or lesser extent, tools of the state. They become hooked on the public funding and prostitute their principles in pursuit of their next fix.

And why should private donors continue to fund them
when the government has assumed responsibility for
solving the problems and has already taxed them to
provide the funding.

Sorry iPhone keyboard!!

Pagar @ 19

The problem is that when charities accept taxpayers funds to carry out public functions they prostitute themselves and become, to a greater or lesser extent, tools of the state. They become hooked on the public funding and prostitute their principles in pursuit of their next fix.

but surely that is true of every charity,no matter any revenue source? Let us say that there is a partnership between say, ‘save the children’ and Tescos. That charity have to please Tesco to keep its revenue stream alive. So what if the children that need to be saved are needing to be saved because Tesco are driving their familiesof the land to make way for a factory, for example? Then what? They risk losing money and are forced to keep quiet? So Tesco buy off the only real campaigning group opposed to their plans?

Do you object to charities getting into bed with private enterprise? Are such charties ‘real charities’?

They should rename it the exploitative society. Cameron is already planning to cut winter fuel payments for the elderly. That’s really ‘BIG’ of him isn’t it?


Reactions: Twitter, blogs
  1. Liberal Conspiracy

    A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ

  2. False Economy

    RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ

  3. Aisha

    rt@ libcon A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ >we know this.way snow dealt with epitomises this

  4. LiberalLabour

    RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ

  5. WestMonster

    RT @FalseEcon: RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ #UKpolitics

  6. Justin Macartney

    RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ I could have told them that for free

  7. mark wright

    RT @FalseEcon: RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ

  8. RupertRead

    RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ <<The real 'big society' wld be left/Green-based

  9. Phil Randal

    RT @RupertRead: RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ <<The real 'big societ …

  10. Kieron Merrett

    TUC's Richard Exell on @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ

  11. carboncoach

    RT @RupertRead: RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ <<The real 'big societ …

  12. christine dawson

    RT @RupertRead: RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ <<The real 'big societ …

  13. Nat Bocking

    report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ

  14. thabet

    A new report shows why ‘the Big Society’ won’t really work | Liberal Conspiracy http://t.co/RDlu9Uz via @libcon

  15. Lilly Hunter

    RT @RupertRead: RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ <<The real 'big societ …

  16. Juan Voet

    RT @FalseEcon: RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ

  17. Boris Watch

    RT @thabet1979: A new report shows why ‘the Big Society’ won’t really work | Liberal Conspiracy http://t.co/RDlu9Uz via @libcon

  18. David Carter

    RT @thabet1979: A new report shows why ‘the Big Society’ won’t really work | Liberal Conspiracy http://t.co/RDlu9Uz via @libcon

  19. Peter Pannier

    RT @thabet1979: A new report shows why ‘the Big Society’ won’t really work | Liberal Conspiracy http://t.co/RDlu9Uz via @libcon

  20. Rowan Tomlinson

    RT @FalseEcon: RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ

  21. Sue Bristow

    Have a look at this A new report shows why ‘the Big Society’ won’t really work | Liberal Conspiracy http://t.co/332bUWF via @libcon

  22. Loraine

    A new report shows why ‘the Big Society’ won’t really work | Liberal Conspiracy http://t.co/mpxRInc #dayx3 #demo2010 #ukuncut #solidarity

  23. GatesheadGreenParty

    RT @FalseEcon: RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ #gateshead #tyne

  24. Rick

    RT @FalseEcon: RT @libcon: A new report shows why 'the Big Society' won't really work http://bit.ly/fiKVhZ

  25. sianushka

    do bears shit in the woods? http://liberalconspiracy.org/2010/12/19/a-new-report-shows-why-the-big-society-wont-really-work/





Sorry, the comment form is closed at this time.