Tim Loughton speaks at the Funding the Future conference

This speech was published under the 2010 to 2015 Conservative and Liberal Democrat coalition government

The Children's Minister talks about the importance of innovation in the voluntary and community sector.

Thanks Tony - and my thanks to Action Planning for inviting me along today for this afternoon’s children and young people session.

I just wanted to start, if I can, by saying what a pleasure it is to be here again. I attended last year’s conference and was hugely impressed by the programme on offer to delegates. And from the look of it, it appears as though this year’s event is, if anything, even bigger and better.

So, my thanks to you all, to ACEVO, to the Charities Aid Foundation and of course to today’s other sponsors and backers. It’s wonderful to join you.

From the off, I wanted to repeat the message that I’m sure Eric, Jeremy, Nick, and Lord Freud have already set out today - and underline just how critical the voluntary and charitable sector is to this Government.

It’s very easy, I know, for cynics to take a pop at ideas like the Big Society, but this is actually a hugely important time for the third sector.

Never before has the work you’ve done been more highly prized by a Government, and never before has your contribution been more actively encouraged…

… with new opportunities being opened up to the sector all the time through things like the Localism Bill; the Big Society Bank and new approaches to social finance; and, of course, through the Opening Public Services white paper.

So, while there will always be those who think public policy should control bad influences, rather than promote good ones, there is - I think - real cause for optimism in our sector over the coming years.

However, in saying all this, I’m also acutely aware that despite the steps forward - these are still, as Kevin Curley said at the NAVCA conference, the ‘hardest of times’.

And in all of this, there’s that same, dark irony that a sector which is based so heavily on the values of charity and selflessness, has been so adversely affected by a financial crisis caused by the very opposite of these things.

Nevertheless, as Kevin said, this is not the time to wring hands - it’s the time for pragmatism and to seize opportunities…

…and that means we’ve got to baton down the hatches, and make sure that when the economic wave finally rolls over us, we emerge with a stronger, more resilient and more sustainable sector.

In all likelihood, of course, this means things won’t necessarily look the same tomorrow as they do today.

So, just as the prime minister called for a ‘new chapter in the economic story’ at the weekend - with greater focus on innovation.

So too we need to find a new chapter and entrepreneurial spirit in the voluntary and community sector.

That’s not going to be easy by any stretch of the imagination - but history has repeatedly shown us that innovation thrives in the hardest of times.

And in the voluntary and charitable sector in particular, there are literally hundreds of examples where adaptation and innovation have already taken place.

Not so long ago, for example, I heard one charity recruitment consultant mention that in the early 90s, many voluntary organisations were being run by enthusiastic amateurs like ex-army men.

Now, as he put it, ‘there was something to be said for candidates who, when asked what conflicts they had resolved at work, could claim victory in north Atlantic sea battles’.

But nowadays, we’re also benefiting from a much broader church of professionals - who are leaving business in droves to come and work in this sector, bringing their experience and expertise with them…

… as a result of which, we’re seeing an increasingly market-savvy approach to charity income - and an increasing confidence to take part in things like partnerships and mergers, similar to the one we saw between ‘Help the Aged’ and ‘Age Concern’ - when they formed AGE UK.

This is not - in short - a mission impossible. But if we’re going to pull off the same kind of trick for youth charities in 2011, then we have to have the same spirit of enterprise and adventure.

And for us, that means two things in particular. Firstly, getting the sector to think more creatively and innovatively about the way it delivers services.

And secondly, getting government to provide a more effective helping hand than it has in the past.

Today, I’m going to look at both of those points, but I’m going to start, if I can, with the second because while the big society has its beginning and end product in local communities…

… a key point on the journey is in the corridors of Whitehall, where we are witnessing a radical redistribution of power away from senior civil servants, towards the voluntary sector.

We have, for example, just launched the Strategic Partnership programme, which will help us work much more closely with voluntary sector organisations in shaping national policy and in supporting the sector itself.

That work, as many of you will know, was announced alongside the £60 million VCS grant at the end of last month - 10 per cent of which will be spent on building capacity within the sector to help organisations make that transition away from central government grants - towards payment by results.

And, over time, we expect both the grant and the strategic partner programme to help us build far greater capacity in the sector, particularly for the smaller organisations who are most worried about the downturn.

This is all though, simply part of a much wider body of work we’re doing to bring the proverbial mountain to Mohammed, and get government to work more closer with the voluntary and community sector.

On a purely personal level, for instance, I’m getting young people into the department to talk through policy on a youth advisory group; I’ve set up a regular business roundtable; a local authority roundtable; and there’s also now a youth VCS group.

It’s part of a general trend away from central control, and towards a more democratic, more efficient and more dynamic partnership.

So, for instance, as many of you will know, we’re working very closely now with Kevin and the National Association for Voluntary and Community Action - already publishing the Better Together paper, which has some incredibly useful examples, and business cases, of how local authorities can work well with the sector to minimise the impact of any spending cuts.

And we’re also now committed to opening up public services and making it easier for the sector to get involved in service delivery.

This has already happened, for example, in the tendering process for the National Citizen Service pilots, which was so successful that we want it to provide a blueprint for closer partnership working right across the sector.

And while I don’t want to jinx any of those projects, I can say I’ve been absolutely delighted with the quality of the partnerships we’ve been able to develop through the pilots, with some truly inspirational youth organisations like: Young Devon; the Bolton Lads and Girls Club; Catch 22; The National Young Volunteers’ Trust; the Prince’s Trust; and Football League Ltd, amongst others.

Over time, we hope that many more will get involved as the pilots roll out…

… helping thousands of 16-year-olds to develop the skills they need to become active and responsible citizens, to mix with people from different backgrounds, and to start getting involved in their communities.

In a similar vein to this work of course, we’ve also introduced the recent Localism Bill, which included measures that will give youth organisations the right to challenge local authorities to run services - if they do things better or more cost effectively.

Now, this is - I think - a radical shift. And despite all the uncertainty that comes with change, this is a shift that brings with it opportunities to reinvent, innovate and create real sustainability in the sector.

And I’d certainly urge everyone here to get involved in the consultation that was launched last month on that ‘Community Right to Challenge’.

However, all this change means that much of the responsibility for reform is now in the hands of local organisations and authorities - a point that brings me on to that second area I wanted to look at today…

…because we want the sector to determine the look and feel of future services and how they deliver them. Giving charity leaders much greater autonomy and flexibility over how they do business.

We are keen to support, for example, the creation of things like mutuals, co-operatives and other types of employee-led organisations in the children and young persons’ sector.

Not only do they offer increased freedom and autonomy to frontline volunteers - they also play a role in breaking open overly bureaucratic state monopolies - and creating more plural and diverse markets.

The Department is, for instance, particularly interested in how employee-led models might be applied within areas of Sure Start children’s centres, MyPlace - which we’ve just committed a further £134 million to - and local authority youth services…

… while, of course, we already have social work practices that are independent, social worker-led organisations, that deliver support to children in care.

All, I think, great examples of how the voluntary and community sector, as well as public sector employees, can lead change and drive innovation.

However, this is not just about structures and ownership - it’s about quality of outcomes, and where the sector focuses its resources to greatest effect.

It is, in other words, about producing more evidence based projects, rather than numbers based projects.

And that’s why, as a government, we’re so keen to see smarter thinking instituted right across the sector - with a hard focus on early intervention in our communities, which we know saves us around £8 for every £1 we spend.

To help this work, the £2.2 billion Early Intervention Grant was announced in the last spending review, and it will help local authorities to focus far more on this kind of prevention work - rather than just spending money on papering over the cracks in communities.

Included within it is extra help for the most disadvantaged families to access free nursery care for their children. It includes enough investment to guarantee the universal coverage of Sure Start children’s centres, and it includes money to support things like family recovery projects and family intervention projects.

Indeed, just a few months ago, I was up in Nottingham visiting a family intervention project in the city…

… And I remember one family in particular, with a mother and her 10 children, who had endured a huge catalogue of problems that had left her children on the brink of being taken into care.

However, staff there had placed a huge chart right across the wall, with a line through the middle and then, on the left hand side, you had the family’s starting point in the project - with all their specific problems listed below the line - in the red - including the children getting into trouble with the law, truancy, violence, criminal behaviour, poor parenting, and poor health.

All of these problems, needless to say, had a cost attached to them, with some agency or another paying for it. But as you walked across the room and through the timeline, one by one you could see the problems lifting themselves above the line, back into the black.

And eventually, you got to the point where the mother had enrolled on a law course and moved out of reach of a violent husband, and her children were no longer in trouble with the police, and were attending school regularly.

Visually, it was a very powerful indicator of the value of early intervention work. The challenge for all of us though, is to embrace this kind of focus and innovation right across the sector.

And that will certainly require charities and voluntary groups in the youth sector, to think hard about how they deal with local authority cuts:

  • to think hard about how they take advantage of the localism bill and the markets it has opened up to you;
  • and to tell us exactly where the quick wins can be made in terms of building capacity and innovation in the sector.

So, to end, let me just repeat that message around the importance of smarter working.

It can sound almost ruthless to talk about business practice and entrepreneurship when it’s in relation to the voluntary and community sector…

…but the fact remains that no matter where you work, or what sector you’re involved in, it is invariably the organisations who adapt to change, who prosper in the long term.

So, I can promise you that the sector that will emerge over the coming years will be a more resilient, more effective and more sustainable one.

Fantastic new opportunities exist to drive reform and shape the future of local communities, free from government micro-management. And fantastic opportunities exist to deliver key public services in your communities for the first time.

Yes, these are difficult times, but they’re not impossible times. There may be some consolidation in the sector, there may be some change, but we will get through it in partnership with leaders in the sector.

Thank you.