Posts By: Gemma Quainton

Cooperatives are enjoying a moment

Once charities were seen as the magic bullet for public service reform. But now their place seems to have been usurped by another part of the third sector: cooperatives.

Last month, Shadow Chancellor George Osborne promised to free public sector staff to form employee-led “John Lewis” style co-operatives and sell their services back to the taxpayer. The Social Enterprise Coalition is right behind the idea.

But while all attention seems focused on the mutualisation of the public sector, some are asking whether it is the private sector that is most ripe to benefit from the adoption of the cooperative ethos and structure. Last month, to rather less fanfare, umbrella body Cooperatives UK called for legislation to give football supporters the right to convert their clubs into cooperatives, provided 75 per cent of season ticket holders were in favour. The market failure which has seen clubs like Portsmouth brought to the brink by reckless owners could be replaced, the argument goes, by genuinely responsible ownership.

Another campaign, run by the Alliance for Finance, is calling for the re-mutualisation of Northern Rock, the building society-turned-bank that sparked off the financial crisis in 2008. Instead of being sold back to the private sector, argues secretary Russell Greig, “the new company could be turned into a community-owned organisation, serving the needs of the communities and able to re-invest in them.”

In their influential new book, The Spirit Level: Why Equality is Better for Everyone, epidemiologists Richard Wilkinson and Kate Pickett argue that “the concept of a company being owned by outside investors has implications that look increasingly anachronistic.”

Citing the success of cooperative experiments such as the huge Mondragon Cooperative group in Spain, they call for tax incentives and legal support to begin a gradual conversion of the economy to employee ownership and control. Much like John Lewis, in fact. Current record levels of inequality would be radically reduced, people would regain the sense of being part of a community, and other social blights such as mental ill health and crime would be alleviated.

The intellectual inspiration behind Osborne’s cooperative proposals is Red Tory Phillip Blond, whose pamphlet, The Ownership State pre-figured the Tory plans. But Blond’s lesser known opponent, Blue Labour’s Maurice Glasman, is also an advocate of mutualisation. He argues that all institutions, public and private, with more than 50 employees, should adopt a new form of governance, giving equal weight to workers, owners and the local community on their boards.

Mutualism could be the idea of the future. Just in more radical ways than George Osborne had in mind.

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Was this the Charity Tribunal’s last hurrah?

The final outcome of the Kidd Legacy case, announced by the charity tribunal on Wednesday, looks like a very satisfying one – but you can’t help fearing that there might not be many more where that came from.

In many ways the Kidd Legacy appeal is a shining example of what the tribunal was set up to do. In a classic David versus Goliath case, two local residents, without legal representation, were able partly to overturn to Charity Commission’s response to Dartford Borough Council’s inadvertent sale in breach of trust of charitable land to a developer associated with the Tesco supermarket giant.

It also looks as if the result will be a model code of conduct on conflicts of interest for councils that act as sole trustees of charities. Given all the recent controversy surrounding council administration of charities, that must be seen as a very welcome development for the entire charity sector.

But the question that demands to be asked is whether this might also be the tribunal’s last hurrah. It is resourced for 50 cases a year and, after a slow start in 2008, its workload was expected to have picked up by now. But that has singularly failed to happen. After last week’s decision to strike out African Aids Action’s appeal against the findings of a commission inquiry, the tribunal currently has precisely zero cases on its books.

Not only that, but the word about the value of the tribunal does not seem to be getting out. The commission’s decision to reject the Gnostic Centre’s application for charitable status was “begging” to be appealed to the tribunal, according to third sector columnist and charity lawyer Rosamund McCarthy. But the charity preferred to submit a revised application, fearing the cost and possible negative publicity of a tribunal appeal. Nor did the commission see fit to “refer” any of the highly nuanced points of law involved in that case to the tribunal for clarification, as it is permitted to do – provided the Attorney General agrees.

Charity lawyers are holding their breath to see whether any of the fee-charging schools that failed the commission’s public benefit assessment last summer refuse to comply with regulator’s directions to pull their socks up, triggering an order that they could then appeal against to the tribunal.

Such a case would certainly thrust the tribunal well and truly into the media spotlight, but so far, the schools have indicated that they are prepared to do as they are told.

Besides, such an appeal would not be heard until the end of the year at the earliest – by which time the bell may already have tolled for the tribunal. The Scottish Government has already decided to chop the tribunal’s Scottish equivalent, the Scottish Charity Appeals Panel, after it heard just one case in three years, and we all know that the next government, whatever its colour, is likely to seek out things it can cut without attracting huge, negative headlines. An obscure, over-resourced tribunal that has only heard three full cases in nearly two years seems like an obvious target. So – alas for the sector – the Kidd Legacy case might well become the symbol of what might have been for the charity tribunal.

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Making sense of social media is like herding cats

We had half-an-hour to go before the panel I was chairing at the Media 140 event on social media in the third sector event last week was due to face the audience. Fear was setting in.

Huddled in the corner, the panellists and I were chatting about the kinds of questions I would be putting to them before opening up the session to the audience in the room and on the web. And while we had all worked with social media, the sense that we might be out of our depth was creeping in.

“What does that question mean?” asked one panellist, pointing to the question ‘Where is our community?’ which had been suggested as a discussion topic.

“Er, not too sure to be honest,” I replied. After a bit of thought I figured we had better skip that one, much to the panel’s relief. No one could be quite sure if it was an important question or just gibberish (although I’m almost certain it was the latter).

Trying to identify what works and what doesn’t in social media is like trying to herd cats. Sometimes social media initiatives fail for no discernible reason. Sometimes they succeed, but we’re at a loss to know why.

Ten years ago most people were only just online, and we still had time to make a cup of coffee while our dial-up connections loaded up websites. So it’s laughable to think that anyone should already have some magic formula for something as emergent and bottom-up as social media.

We really shouldn’t get intimidated or worried by it, especially since there’s so little financial risk involved.

Social media is a chance to experiment and play. Your social media experiments might not result in what you planned, but the unexpected isn’t always the unwelcome.

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Why do charities want a fourth term for Labour?

The sector wants another Labour government – not by a slim margin but by a massive one. That is the finding from the State of the Sector survey Third Sector carried out with research agency nfpSynergy.

These results do come with caveats; it’s a self-selected online survey for a start, but I doubt many would be shocked to find Labour is the sector’s party of choice.

What is surprising is the size of Labour’s lead over the Conservatives, given how unpopular Gordon Brown’s government is with the wider public.

The survey offered no insights into why this might be, but there are several possible explanations. One might be that those taking part found it hard to untangle their own political views when they answered, so the result reflects the bias of the sector’s employees.

Another might be that the Conservatives have not yet convinced the sector that it will be safe in their hands.

Finally, the result might reflect a view that public spending cuts are bad for the sector, which harms the Conservatives because they have talked more openly of reducing expenditure than Labour have done.

Whatever the reason, the finding does raise a couple of important questions.

First, just how in touch are charity employees with the UK as a whole, given the glaring difference between public opinion polls and our survey?

And, if they are out of step with the public, does it matter?

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Charities should take notice of the anti-X Factor campaign


For me, two recent and seemingly unconnected events have highlighted the power of ideas and the ability of civil society to
harness them.

First, the recent visit to the UK of Eboo Patel, founder of
the USA’s Interfaith Youth Core. Eboo’s thesis is that we are living at the
collision-point of four seismic shifts: religious revival; increasing
interaction between people of different faiths; a youth bulge (he notes approximately
60 per cent of Iranians, for example, are under 30); and the fact that extremists are
the only people organising around the first three trends.

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A New Year wish for the social investment bank

So this is Christmas. And with another year over and a new one not yet begun, the pre-Budget report tells of untold riches in dormant accounts to be used to fund a social investment wholesale bank and projects for young people.

The latter will be routed through the Big Lottery Fund. I just hope – I really, really hope – that we’re not going to parcel this up and shovel it out as bog-standard capital and short-term, fixed-life, project-focused revenue grants.

Why? Because the ills of the funding status quo are so deep and well worn that they threaten to see off what Christmas cheer I might start to be feeling.

Let’s remember that the insistence on tying grants almost exclusively to short-term deliverables means that some of society’s most valuable work takes place in profoundly unstable institutions, because charities are over-stretched and under-capitalised.

In our crazy, dystopian status quo, immediate outputs are prioritised over long-term outcomes; funding is insufficiently flexible to respond to changing circumstances; planning horizons are typically limited to one or to three-year cycles: and because key staff are not retained, core knowledge and competence is lost.

Funding follows connections and charisma, not necessarily effectiveness. There is no incentive to outperform, because restricted funds are clawed back in the event of efficiency gains, or leveraging of other income. Demands for unrealistic exit plans concoct the fiction that complex, deep-seated problems can be solved in arbitrary, fixed and short time frames.

But it doesn’t have to be like this.

A number of funders have made great strides. The Big Lottery Fund has shown itself pretty adept at smart investment.

So what I really, really want this Christmas is for the Big Lottery Fund to look over the brow of the hill to those folk who’ll be getting excited about the social investment wholesale bank, and think hard about what social investment can teach us all.

In the past decade, a range of agencies, such as Venturesome and The Impetus Trust, have pioneered techniques for social investment. Perhaps too often we’ve focused on loans. For my money, the principle of investing in the underlying and long-term strength of institutions, not just the projects they carry out, is what really counts in social investment.

So when it comes to unclaimed assets, any investment in young people is going to be infinitely stronger if it’s informed by the patient-capital approach of social investment.

Happy Christmas.

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Do we need a charity sector commentariat?

Hooray, hurrah, huzzah! (Is huzzah a word?) I have been asked to blog. Officially. By a proper, bona fide news magazine. Third Sector no less – doughty organ of civil society and recorder of the slings and arrows that befall our collective sector from time to time. Yet brief flush of pride aside, aren’t there some Troubling Questions About Blogs to be factored first, before I accept?

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