How much say should a Local Authority have in how a voluntary organisation is run? In the case of Kids Company the government thinks it is reasonable to tell a voluntary organisation to remove its charismatic and outspoken chief executive if it wants to continue receiving government funds. This is such a high profile organisation, one that in the past senior politicians have been happy to be associated with, that the threat of withdrawing funds makes the national news and in the absence(at the time) of a major financial scandal the insistence on the removal of the chief executive seems extreme. Yet at a local level the issues underlying this action are being played out up and down the country a thousand times over with very little notice being taken except by those directly involved.
Focus our funding
The relationship with voluntary, community and faith groups has changed as a result of budget cuts. In good times supporting voluntary groups is something local councillors are keen to be seen doing. But these are not good times. Its hard to justify funding voluntary groups whilst, cutting your own services and making staff redundant. First grants were cut across the board but as the budget pressure increased a more strategic approach was required. In a large authority thousands of organisations received grants of less than £500 could the authority simply stop funding? Hundreds of organisations received grants under £5000 could the authority still afford it? A small number of voluntary groups received large grants could this be justified? After a series of painful reviews the emphases was on larger voluntary groups who provided what the local authority wanted to fund rather than what the voluntary group wanted to provide.
Is this a well run voluntary group?
LAs were comfortable with well established voluntary groups like Age Concern, Alzimmers Disease Society or Mencap the type of organisation that has a retired bank or building society manager as treasurer, people comfortable with keeping detailed financial records and not phased by lengthy biding forms, organisations with an open and transparent decision making process and a management committee that is representative, informed and holds paid officials accountable. But innovative voluntary groups that grow out of demands not being meet by local authority are driven by the energy and commitment of an individual and a few like minded people. They may not have experience of financial management, running a business, submitting bids, managing staff and recruitment but they do have a charismatic leader, good at raising the organisations profile, fund raising and keeping every one motivated.
So how should the LA respond?
This head of the voluntary group, is a self appointed leader of the community and a vocal critic of the council. Others groups feel excluded, there are concerns about how the operation works, the autocratic management style and complaints of jobs for mates. Is the LA right to insist future funding is dependant on changes to the management committee, a new qualified treasure, posts advertised externally and a LA rep on the recruitment panel. Is the LA trying to buy off an influential critic or safe guarding public funds? These issues tend to arise more often in voluntary groups from black and ethnic minority communities the very groups that LAs have traditionally struggled to reach, is this an example of institutional racism or just a case of he who pays the piper calls the tune?