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25 June 2018, 10:33

What we can learn from local charities

Mike Wild from MACC writes for CFG on the iterative power of small, local organisations and community-led initiatives.

In an article for May's Finance Focus, Mike Wild, Chief Executive of MACC - the keynote speaker at CFG's Northern Conference on 4 July - discusses his views on the present and future landscape of the voluntary, community and social enterprise sector.

I seldom talk about ‘the North’ as it triggers so many assumptions. Alternatively, I could focus on the economies of northern cities and their rural hinterlands or the changing demographics of an area which includes roughly a quarter of the population of the UK; but it becomes difficult to avoid framing it around how the North is “not London and the South East”. That’s how our national discourse about places works, and the same would be true for Wales, Scotland, the South West and the Midlands. Obviously it’s grossly oversimplistic; there is ‘Local London’ where real people live and ‘Big London’ a more conceptual space where businesses, banks and government departments operate. The reality for me is that any analysis of the state of our sector in a place, (no matter which geography you use) is going to be primarily about the balance of urban and rural both of which are totally different from ‘Big London’. London is the outlier not the norm, a fact we often overlook. The whole devolution agenda is about recognising that so much of our economy, power, influence, media and democracy is overcentralized.

The state of the voluntary, community and social enterprise sector across the North is basically the same as the local picture practically anywhere else in the country. Most of our organisations are small and local and are essentially the community organising itself into groups to undertake socially useful work. Our sector metrics are equally familiar. Most income for the area is concentrated in a relatively small number of national charities (via London), a paid workforce alongside a much larger voluntary one and so on. I think we fall short in our sector metrics; we are inclined to report rising income and a growing staff team as indicators of health but without the context of demand, let alone impact, these figures are fairly meaningless. The paid sector workforce in the North is, according to IPPR North, around 0.25million full time equivalent. Who knows if that is the number we need for this place? Who knows how to answer such a question?

Our own studies in the city of Manchester, alongside colleagues from the other Greater Manchester boroughs, are a perfect paddling duck metaphor: huge extra effort going on beneath the surface to keep moving forward. A highly entrepreneurial sector is doing all it can to keep the doors open as demand continues to increase. Our local organisations are trying to meet that demand with the barest of means. I worry how long we can keep going at this level of effort. Although the “credit crunch” recession was ten years ago, it still feels very much in the here and now to a lot of us after years of austerity. Our work has unquestionably got harder: the impacts of policies such as welfare reform, NHS funding, cuts to Local Authority budgets and the general stagnation of wages has meant that, a decade on, while we have managed to protect much frontline delivery, we have been forced to strip out what little room there was for organisation development, workforce development, strategic conversations, collective exploration and the social pioneer role the sector has historically played. We must find ways to reinvest effort and resources into our pioneership. I would strongly urge funders to ensure they rebuild this capacity in organisations they fund – it is not overheads or administration, it is part of the social leadership of our sector.

We need that capacity because I think the key opportunity ahead of us is for a rethink of our sector’s role in places. To have healthy thriving places, we need local organisations to act in the round; to see the impact of public health on the local economy, to think about building shared wealth and modelling what Kate Raworth calls “the safe and just space for humanity”: inclusive and sustainable economies. Our sector will need to up its game digitally. It’s easy to make a lot of digital noise but simply accelerating old ways of operating misses the point – and we need to be wary of shiny innovation. I have seen so many tech innovations which are exciting models but rarely rooted in communities. Digital enables completely new forms of collaboration; for example, I would like to see exploration by national organisations of how to work better with locally grown charities in more creative ways than just the subcontractor supply chain. Again, I think funders can help pull-and-push on this.

In a similar vein, there has been little scope for financial innovation. Most of our organisations operate hand-to-mouth. With reserves in long term decline, concepts such as investment feel increasingly remote from local organisations as income models. Similarly, while social investment is welcome as a broad concept, a loan model is largely useless for the vast majority of our organisations.

I would like to see greater exploration of community led approaches which harness the iterative power of many smaller organisations acting collectively. Community banks are a growing movement which our sector could support by pooling reserves, for example, providing mutual support while also enabling our collective economic power to leverage additional impact.

‘Devolution’ and the ‘Northern Powerhouse’ are, at best, concepts which bring people together with a shared sense of ambition and responsibility for building better places, and changing the conversation about our centralised national structures. It is important to remember though that these sit in the public sector space and while we should be part of these conversations, there is a risk of neglecting our own agency; there is much our sector can do in its own right.

Again, we need to rexamine how we can be part of a place (including the many communities of identity), not just an input to certain individuals who fit the criteria of ‘beneficiary’. Concepts such as reciprocity, bringing people together will become ever more fundamental and there is an opportunity to learn from the flaws of the ‘gig economy’ to model something better using the huge potential we have for connecting people. Cultivating a focus on shared benefit and socially useful activity will become ever more important, particularly as the impacts of Brexit are felt. A significant risk for us us that far from increasing investment in place building, many areas of the North risk losing significant funds when EU funding finally ends. The work done by Voluntary Sector North West to analyse the impact on Liverpool city region is the only piece of hard analysis I have seen; we need to be much more vocal as a sector about our role and our vision(s) for the post-Brexit era and to make the case now for investment in our ability not only to meet need, but help shape the future. The North’s voice in that needs to be much stronger.

 

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