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Looking forward in gloomy times

Nobody said it was easy. No one ever said it would be this hard, once sang Chris Martin. And that could be said to be true of my now two and a half years with Children in Scotland.

While I love the organisation and it is a real privilege to have this role, navigating the twin menaces of COVID-19 and the cost-of-living crisis has proven to be quite the challenge. While different charities have distinct challenges, a common thread is how to keep and build a resilient organisation.

Since my first day, I have been looking back over my shoulder at the menaces as they have tried to catch us and grind us down. This year we have had to unfortunately make unwanted changes to the organisation, including having to say goodbye to three valuable and experienced members of staff, as well as having to reduce hours for another three.

This is something that we are increasingly seeing across the charity sector (and, indeed, beyond). The SCVO tracker (click here for more) gives a good insight into the current reality for Scotland’s third sector. What is worrying is that this is happening at a time when demand for the services of charities working with and for children and young people is higher than ever.

At difficult times like these, it is always necessary to pause and think, so I thought I would share a few of my emerging reflections.

An inevitable cycle?

While this current situation has been brought on by the poisonous combination of COVID-19 and the cost-of-living crisis, were we to take a historical look at the charity sector, we would see many such moments when the economic situation has made it difficult for charities and the wider third sector.

So, unless we create new economic models, we have to see this as the long-term context we are operating in. There will be times of plenty and times of scarcity, and our job will be to navigate our organisations through this constantly changing environment. This is not the unusual, but the usual.

Are we resilient enough?

We know that the charities that come through such crises best are ones that have built the best levels of resilience. We also know that for large parts of the charity sector, building this resilience is difficult.

We all probably recognise the shoogly combination of the challenge of full cost recovery through project funding, the difficulty of funding the core functions through grants, the sometimes restrictive nature of the commissioning relationships we have, and the short-term nature of many of the grants and other funding streams, which we rely on to do our work.

As a result, we often find it difficult to even build the minimum level of reserves.

We are often on a bit of a hamster wheel, running fast just to keep us financially healthy in the short-term, leaving us little capacity to work on income generation that might be more relevant to long-term sustainability – and might actually allow us to have a rest from the wheel now and again.

Within Children in Scotland, we will be thinking about how to find the time and resource to better invest in long-term sustainability. I think we have done some good things on this, and I am thankful that we do have a level of resilience. I am also confident that, having made changes at the start of this year, we are now in a stronger financial position. However, there is more to be done for the medium and longer term, and I need to find time and the necessary resources to do this work well.

Does collaboration go far enough?

Ultimately the charity sector is set up to be lots of independent stars in a rich, twinkly galaxy. In Charity Law, charity trustees have to consider the best interests of their charity, not the charity sector as a whole. So, there is ultimately a ‘selfish’ aspect to the way we are created and, indeed, the way we have to act, particularly when there is competition for resources.

In practice, the charity sector can be, and often is, very collaborative. We know that the power of the sector is greater the more we can bring our different strengths together. However, there is possibly a question about whether or not we could do more to collaborate to build the resilience of the sector as a whole.

I’m not sure quite what this looks like yet, but I have a real question about how we can do more to make the most of economies of scale across the whole sector. There have been some good initiatives in the past. For instance, creating shared spaces for charities, looking at how to create economies of scale in core costs, looking at sharing expertise across various organisations, and so on.

A more difficult question is whether we have the strength and capacity to have even more difficult conversations. Some of the most difficult conversations that some organisations I know have had is when they have realised there might be value in even closer collaboration, even the possibility of a merger. However, I am not sure that as a sector we are as strong as we need to be at having these difficult conversations in a safe way.

Making the most of the moment

I imagine I will be involved in many conversations about resilience over the next wee while. What I want to explore is what more we can do for our members and our wider network as we explore this issue. How can we help build better funding models? How can we work together to demand better commissioning? How can we collaborate better together both in terms of cost savings, but also in terms of releasing or creating new, independent income streams? How can we create space to have the creative conversations to make all this happen?

I am open to ideas, conversations and debates. So please get in touch if you have something you want to share, sound out or just get off your chest.

Ultimately, the drive needs to be towards how we can support the sector as a whole to be more resilient so that we can all twinkle as brightly as possible.

Judith will give more insights into the challenges and opportunities facing the charity sector during her keynote speech at our Annual Conference 2024 on 29-30 May at Murrayfield Stadium, Edinburgh. 

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