Valuing the Third Sector

– in the Scottish Parliament on 1st December 2020.

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Photo of Lewis Macdonald Lewis Macdonald Labour

T he next item of business is a debate on motion S5M-23408, in the name of Ruth Maguire, on valuing the third sector. I invite Ruth Maguire, on behalf of the Equalities and Human Rights Committee, to open the debate.

Photo of Ruth Maguire Ruth Maguire Scottish National Party

I welcome the opportunity to debate the Equalities and Human Rights Committee’s report, “Looking ahead to the Scottish Government’s Draft Budget 2020-21: Valuing the Third Sector”, and our most recent budget scrutiny work, which provides an update on our views on the impact of the pandemic on the voluntary sector. Although the report was published in November last year, due to the impact of the pandemic it has not been possible to debate it until today.

I thank committee colleagues, some of whom have now moved on, for their hard work and I thank all the people who provided written and oral evidence. In particular, I say a special thank you to Glasgow Council for the Voluntary Sector and the Forth Valley third sector interfaces in Falkirk, Stirling and Clackmannanshire. With their help, the committee held events with 60 voluntary organisations, which shared their invaluable experience with us.

As members know, Covid-19 has had a disproportionate impact on many who already face disadvantage and discrimination. Our 2019 report emphasised that the voluntary sector has a valuable role to play in supporting the equality and human rights agendas in Scotland. It is therefore no surprise to us that the work of charities was key to providing immediate support to many people in their localities during the pandemic, and yet many charities are now in a situation where they may not survive for much longer. Research by the Office of the Scottish Charity Regulator found that 20 per cent of Scottish charities are facing a “critical threat” to their financial viability in the next 12 months as incomes fall and demand for services grows. Today’s debate is important to ensure that the committee’s recommendations are not lost sight of and, indeed, are implemented to ensure the wellbeing and sustainability of the voluntary sector so that it can continue to play its vital role not just during the pandemic but in Scotland’s recovery and beyond.

I am sure that members will join me today in saying a huge thank you to every single volunteer and charity worker who gives up their time to help those in their communities who are struggling to cope. During the pandemic, those individuals and organisations have leapt into action to support their communities—from meeting the basic right to food to ensuring that people stay connected with each other to stave off the harmful effects of social isolation.

As with inequalities more generally, the pandemic has shone a light on and exacerbated the issues that already existed for the voluntary sector. The committee’s recent budget work continues to highlight two core themes that are critical to the future of Scotland’s voluntary sector: funding and partnership, which I will now focus on.

Last year, the committee identified that voluntary sector funding is complex and precarious. Many voluntary organisations operate in a complex patchwork of statutory funding, fundraised income, earned income and grant income.

According to the Scottish Council for Voluntary Organisations, there are more than 40,000 third sector organisations in Scotland. Some 40 per cent of those organisations work in either social services or health.

Around 25 per cent of third sector income comes from public sector contracts to carry out services, much of which are with local authorities. It is significant to the debate that local authorities receive around 40 per cent of their total revenue income from the Scottish Government each year.

Although the committee acknowledges that councils are under pressure to make savings, it is voluntary groups and charities that are feeling the force of the financial constraints. They are struggling to provide adequate services on the basis of councils’ contracts.

We heard from Ian Bruce of the Glasgow Council for Voluntary Services that, as a sector, organisations were told to diversify their income away from grant funding and move towards trading, fundraising and contracts. He said:

“That has been regarded as good practice. Ironically, during the Covid period, that income—which was regarded as more sustainable—has vanished and organisations that are primarily grant funded have been more stable.”—[

Official Report

,

Equalities and Human Rights Committee

, 1 October 2020; c 15.]

On the sustainability of funding, although third sector witnesses welcomed the Government’s £25 million community and third sector recovery programme, and existing funders have been extremely supportive and accommodating in relation to reporting on the use of funds over the past few months, Neil Cowan of the Poverty Alliance commented that there are growing fears and anxiety about the long-term financial impact.

The committee noted that, in 2019, the Government had moved to a three-year equalities funding cycle. We recommended that other funders should follow suit, and asked the Government to set up a working group, involving key stakeholders, to examine longer-term funding models, and for its conclusions to be made available before the end of this parliamentary session. The Government told us in its response that the

“duration of funding periods is a matter for other statutory funders”.

The committee calls on the Government to rethink its approach and show leadership in that area; to work with other statutory funders to share the benefits of longer-term funding; to harness the work of the Scottish leaders forum for change; and to bring consistency of approach and best practice through the establishment of a working group.

The committee argues that those steps are essential if the Government is to achieve its national outcomes. We are aware that there is no single, direct and effortless solution to the funding issues facing the sector, but the situation could be greatly improved if the Government, statutory funders such as local government, independent funders and the sector itself were to work together strategically to ensure the financial sustainability of the sector.

I will move on to talk more about partnership and collaborative working. Working in partnership was a key theme that arose in our 2019 report. There was an acknowledgement from the sector that it should be looking towards collaboration, for example, by co-locating to cut overhead costs, working together to make addressing shared issues easier, and enabling information to be shared and trust to be built.

However, by far the greatest barrier to partnership working is the competitive funding environment. Participants at the Forth Valley TSI event questioned how partnership working could take place between third sector organisations when they were competing for the same pot of money. Fighting over funding had led to distrust in the sector. One organisation commented, “It’s like a war.”

Conversely, the committee notes that, in responding to the pandemic, there have been many recent examples of strong partnership working between the voluntary sector and local authorities, the Government and the private sector that highlight what can be achieved.

At a national level, we have seen extraordinary outcomes achieved through partnership working, such as the temporary eradication of rough sleeping. That success has come from a partnership approach, shared goals between partners and the temporary removal of hierarchy and bureaucracy.

Our report called for “strengthening collaboration” around the involvement of the sector in service design; involvement of the sector in decommissioning; and a thorough examination of partnership working in the context of a competitive funding environment.

As we navigate our way through and out of this health crisis, we must look to Scotland’s economic future. The scale of the inequalities and societal problems that Scotland will face in the years to come dictate that no one organisation or sector will have all the answers. As the committee noted in its report, the voluntary sector has a key role to play. The Scottish Government’s response to the advisory group on economic recovery commits to “strengthening collaboration” between the voluntary sector, local authorities and Scottish Government. It is unclear exactly how that work will be taken forward. We ask the Scottish Government how the issues raised in our report and most recent budget letter will be addressed in its economic recovery planning.

The third sector should be valued not just for the services that it provides, but because of who it employs—for example, many women and carers who would find it difficult to fit employment around their commitments. It also contributes significantly to employment skills for our young people and people with disabilities. Therefore, let us not forget that by supporting our voluntary sector we are helping countless people to enrich their lives and the lives of others.

We must embrace the adversity of the pandemic and seize it as an opportunity to do things differently. We must learn from innovative practice shown by some funders and the third sector during the pandemic. The Covid crisis has shone a light on the issues impacting the sector and on inequality in our society. Indeed, I would argue that the recommendations in the committee’s report are now even more relevant.

I move,

That the Parliament notes the findings set out in the Equalities and Human Rights Committee’s 4th Report, 2019 (Session 5),

Looking ahead to the Scottish Government’s Draft Budget 2020-21: Valuing the Third Sector

(SP Paper 614), which was published on 7 November 2019, and its letter to the Scottish Government published on 29 October 2020, which includes an update on its views on the impact of the pandemic on the third sector.

Photo of Rachael Hamilton Rachael Hamilton Conservative

I am delighted to open on behalf of the Scottish Conservatives in the debate aptly named “Valuing the Third Sector”. The word “valuing” allows us to debate the true extent of the worth that we place on the sector. I thank the third sector for what it does, from the Samaritans providing mental health support, to Border Women’s Aid providing refuge for women fleeing violence and the Scottish Council for Voluntary Organisations working with grass-roots community groups.

I also thank the Equalities and Human Rights Committee for its work in conducting its important inquiry into the funding of the third sector in Scotland. We have heard from organisations the length and breadth of the third sector during the inquiry and I am glad that the committee has come to a conclusion on the best way forward for assisting the sector during these difficult times. Charities and other organisations have worked tirelessly throughout the pandemic to provide support and comfort to lonely, disabled, sick and vulnerable people in our society. They have been pushed to the limits during stressful times and we on the Conservative benches believe that they deserve better.

The third sector is crucial to Scotland, employing more than 100,000 people and providing invaluable help to all areas of society. The funding conundrum is not a new one, as highlighted by Ruth Maguire. For too long, the Scottish Government has left the third sector in an insecure position, with cuts to local authority spending having a negative effect on its long-term viability.

That is not a consequence of the pandemic. Over the course of the decade, the Government has cut the budget for promoting equalities and human rights by 10 per cent. The Scottish Government claims that its equalities and human rights budget

“supports the drive for social justice, economic and inclusive growth, and community resilience and empowerment” but we know that it is only 0.07 per cent of the total Scottish Government discretionary budget.

I want to keep my contribution positive and to work with the Government to ensure that recommendations are actioned, but that is hardly a ringing endorsement of the Government. We saw in the report how fragile the financial situation is, with short-term funding cycles causing instability in some third sector organisations and creating issues around staff retention and development. The SCVO made that point in its briefing for today’s debate by highlighting that the Scottish Government’s promises of longer-term funding are “very rarely” seen in practice.

I note from the recommendations that the committee asks the Scottish Government to set up a working group involving key stakeholders to examine the longer-term funding models available to statutory funders, which Ruth Maguire talked about, and for its conclusions to be made available before the end of the parliamentary session. That timeline would surely tie in nicely as part of the interim report called for by the Scottish Conservatives today.

Rurality, in combination with the lack of long-term funding and reduced opportunities, is posing problems for third sector organisations when it comes to recruiting staff in many rural areas. That view was echoed by Dumfries and Galloway health and social care partnership.

I know that it is difficult for organisations across the Borders not only to feel part of a local authority budget scrutiny process but to be involved at Scottish Government level. The Scottish budget approach has been criticised as being opaque to the public and to key stakeholders in the third sector in particular, and it should go without saying that the Scottish Government must do more to make the use of public money more visible to stakeholders and encourage participation.

Last week, in the debate on equally safe, I highlighted the need for more secure funding in particular for women’s charities, such as Borders Women’s Aid, that tackle violence against women. In its briefing, Engender states:

“A shortage of suitable refuge accommodation has been exacerbated by restrictions on” movement, in combination with

“a lack of temporary housing options during lockdown, leaving women with an impossible choice to stay in an unsafe home or risk homelessness.”

We need more sustainable funding that gives charities flexibility and financial back-up to support their goals of helping more women to flee a violent household to a safe space.

We know how competitive the funding environment is for the third sector, and especially for rural organisations, which I represent. I am glad that the committee highlighted that issue, as it is hugely disadvantageous to smaller charities and organisations. It must be addressed at Government level as a matter of urgency, because the work of grass-roots and smaller charities is invaluable and they are part of the fabric of our constituencies.

I turn to the Scottish Conservative amendment. We on the Conservative side of the chamber believe that it is important to see interim reporting of progress on the recommendations that the committee has made. If we are to see positive results for the third sector in the short and long term, there must be a midway point at which we can hold the Government to account and measure that improvement. We simply cannot end up years down the line with no progress having been made and no accountability for the delay.

In conclusion, I once again thank the committee for its work on the inquiry and for producing a constructive and detailed set of recommendations. I believe that, if acted on in full, those recommendations will deliver real and progressive change for the third sector.

Another solution would be to take up the Scottish Conservatives’ idea of creating a permanent financial settlement for councils, which would prevent any successor Government from raiding budgets and cutting vital local funding for third sector organisations. Our amendment commits the Government to interim reporting on the recommendations that the committee has set out, and we must ensure that the Government is held to account on its progress in that regard.

I will finish with some observations by the Samaritans:

“Covid-19 has seen a renewed sense of community resilience and altruism from the people of Scotland ... The Scottish Government should not let this moment pass and must reflect the value it believes the third sector brings to Scottish society”.

I move amendment S5M-23408.1, to insert at end:

“, and asks the Scottish Government to commit to an interim report on its progress in implementing the committee’s recommendations.”

Photo of Christina McKelvie Christina McKelvie Scottish National Party

At a time when we are faced with responding to a global pandemic and the unwanted uncertainty that Brexit is bringing to our country, I express my thanks, gratitude and admiration for the way in which the third sector has mobilised to support the people and communities who have been so badly affected by Covid-19. That tireless commitment to helping others and to working collaboratively with the Scottish Government and others has played a major part in ensuring that those who need support have been able to access it.

We should all remember that the work of third sector organisations to support those in need began long before the pandemic and, when we emerge from it, that excellent work will continue. I am therefore glad that the committee has chosen to recognise the work of our third sector partners in its report. The debate rightly marks that vital contribution, which should be central to our thinking as we recover from the pandemic.

I am pleased that, in the equality and human rights portfolio, we have overseen the single largest increase in our budget, from £24.6 million in 2019-20 to its highest-ever level of £30.2 million. That additional budget uplift is enabling us to invest in a range of third sector organisations that are working to secure the best outcomes for Scotland’s people.

My budget continues to promote equality and human rights by supporting a wide range of organisations that are working to achieve equality across the range of protected characteristics, and we will continue to support a range of Scottish Government priorities and commitments. While we acknowledge the 16 days of activism, as we did in Parliament last week, we know that much more must be done to prevent gender-based violence, and we will continue to support the important work of those in the third sector to tackle all forms of violence against women and girls.

For example, more than £1.5 million from the first round of the wellbeing fund was allocated to Scottish Women’s Aid and Rape Crisis Scotland to support service redesign and to ensure that vital third sector specialist services could continue to support women and children during the pandemic. More than £1.7 million has been provided each year for the past three years to disabled people’s organisations in order to support projects promoting disability equality, thereby helping to enable those with lived experience of disability to play a part in the development of policies to solve problems and dismantle barriers. We have provided more than £1.16 million to support older people’s organisations at both national and local community levels, with support for community projects that support older people.

The Equalities and Human Rights Committee considered the use of multiyear funding, and I am pleased to say that we have been able to provide multiyear funding over the past three years. That ensures sufficient time and support for the application process and supports partnership working and the ideals of fair work principles.

The equalities and human rights budget will support the launch of two new funding streams that will support the third sector. Our new delivering equally safe fund will develop and deliver work that directly contributes to delivering the ambitions of our equally safe strategy. I will launch the fund very shortly, and we will announce successful applicants in summer 2021 to allow for projects to start in October 2021.

In addition, our supporting equalities and human rights fund will support organisations in advancing equality and supporting the realisation of human rights. I will launch that fund in early 2021, with successful applicants to be announced, again, in summer 2021 and projects starting in October 2021. Both those funds will run for three years until September 2024, giving that commitment to multiyear funding and providing certainty and stability for longer-term work.

I return now to the advisory group on economic recovery, which was mentioned by the committee convener, Ruth Maguire, in her opening speech. The group was established to advise on Scotland’s economic recovery in the wake of Covid-19. In its report, which was published in June, the group recognised the depth, breadth and reach of the third sector and asked us to put it at the heart of planning for recovery and renewal. In our response to that report, we recognised the need for effective partnership working, and that recognition of the sector’s vital role has been central to the decision to increase the equalities budget. I hope that that reassures the committee.

We are committed to progressing the recommendations in the committee’s report and to addressing the barriers that the third sector faces by strengthening collaboration between the Scottish Government, local government and the sector.

Turning to the amendment in the name of Rachael Hamilton, I know that Ms Hamilton is not on the Equalities and Human Rights Committee, but I wish to reassure her that we regularly update the committee on progress, and I have already done so in my letter in October. If she was on the committee, she would realise that a number of areas cut across many other portfolios, and I updated the committee in October on a number of streams from across every part of Government. I hope that that provides a fuller response to the committee’s report.

Funding and partnership working are rightly central to our thinking, and they both form part of the bigger strategic picture and everything else that we do. Earlier this year, in responding to a recommendation that was made by her national advisory council on women and girls, the First Minister announced the establishment of a new directorate for equality, inclusion and human rights in the Scottish Government, and I am sure that the Equalities and Human Rights Committee will be following its work with interest. The new directorate will bring a strategic focus to our work to embed equality and human rights into all of the work that we do. It will ensure that our capacity to embed equalities and human rights across all areas of Government is strengthened. Our work with the third sector will be central to achieving that ambition.

We can all recognise that what we know as part and parcel of the functions of government today have their roots in the past through the efforts of countless people from the charity sector and the third sector who have effectively played their part. For example, universal suffrage, free education, free healthcare and social housing are all products of people standing up for those ideals, and we can all see the impact of the third sector on our policy decisions and our ideals through the campaigns that are championed through the third sector. They have a deep impact on the work that we do in government.

In reflecting upon those achievements, I am reminded of the words of Michelle Obama:

“There is no magic to achievement. It’s really about hard work, choices, and persistence.”

It is that hard work, those hard choices and that persistence that are so often a hallmark of the untiring work of our third sector in Scotland.

As we look to the future, we must not underestimate the challenges that we face, and none of us does. The Government’s focus on achieving an equal and fair Scotland is unwavering. It is that focus on equality and fairness that will underpin our efforts to meet those challenges.

In closing, I thank the committee for its hard work in producing the report, and for its careful consideration of the evidence that was presented by all who contributed. Again, I acknowledge the work of the countless people in the third sector who are key to realising our ambitions for a fairer Scotland.

Photo of Pauline McNeill Pauline McNeill Labour

The third sector in Scotland has carried out an invaluable role in dealing with Covid-19 under incredibly difficult circumstances. We all agree that we owe the third sector a debt of gratitude. I will also mention the many community groups that sprang up during the pandemic to deliver food and comfort to those who desperately needed it.

The relationship between the third sector and the public sector needs a fundamental shift. We must begin a new partnership-based style of working. The voluntary sector delivers vital services to our communities and we cannot do without it. The sector is far larger than people may think, with more than 40,000 organisations employing more than 100,000 paid staff. However, the sector is struggling to cope with decreasing budgets and funding. The SCVO says that 20 per cent of charities reported

“a critical threat to their financial viability in the next 12 months” and that the sector faces immediate risk. The SCVO also notes that the Scottish Government has reiterated its commitment

“to longer term funding for the sector”,

which the SCVO describes as

“words which we have heard before but very rarely see in practice.”

Similarly, the NSPCC in Scotland notes that local authority budgets have shrunk over a number of years, which has had a knock-on effect on the support that the third sector is able to provide.

Since the start of the pandemic, charities have had to cancel fundraising events, which has led to a loss of income-providing services. The demand for charities has been surging. Crohn’s and Colitis UK, which is a charity that I work with, is such a lifeline to many people, particularly young people.

The SCVO is at the forefront of the United Kingdom-wide #NeverMoreNeeded campaign, which emphasises that, in the face of coronavirus, charities have never been more needed for the essential support that they provide. More than a third of charities are reporting an increase in demand, with front-line services reporting an exponential increase in demand. For example, in October, citizens advice bureaux issued the highest number of pieces of advice in one month since the beginning of lockdown. The figures also reveal a continued increase in demand for advice on servicing debt. A survey by the National Council for Voluntary Organisations in March showed that more than half of charities—52 per cent—plan to reduce services, which is extremely concerning.

In its evidence to the Equalities and Human Rights Committee, the Fraser of Allander institute noted that parents and people with disabilities have been particularly impacted by the effects of the pandemic. We already knew that those families are the poorest, but it highlights the scandal of care packages being taken away due to reprioritisation. That has led to a real worsening of the standards of living. In some cases, family carers have had to try to pick up the slack. Engender notes that the reduction in social care packages

“has led to an increase of the number of unpaid carers in Scotland ... to 1.1 million, of which 61% are women.”

In general, the situation for most parents has improved with schools going back, but schools are still having to send children home, and children are often having to self-isolate with no childcare infrastructure available. That means that a lot of parents, particularly mothers, are struggling.

Women have to make trade-offs to keep their families functioning, which sometimes means that their working lives have to take a back seat. Therefore, in analysing what has happened during the pandemic, we need to make sure that we are not taking a backwards step in the achievements that we have made for women.

As other members have mentioned, there has been a steep rise in domestic abuse during the pandemic, which issue we have debated many times. Scottish Women’s Aid is calling for a new funding model to ensure adequate and effective support. Funding for domestic abuse services remains precarious, and groups are increasingly reliant on grants from organisations such as the Big Lottery Fund to supplement inadequate Government funding.

The Government needs to learn lessons from its current funding model, respond to the times that we are in, and ensure that human rights and equalities are always taken into account when disbursing funds in the future. We cannot do without the third sector—it has been so vital to us up until now, and it will be in the years ahead.

Photo of Beatrice Wishart Beatrice Wishart Liberal Democrat

We have seen how Covid-19 has exacerbated existing inequalities. This debate on funding for the third sector and on securing equalities and human rights is urgent, and I am pleased to be able to contribute to it.

Like other members, I begin by paying tribute to the way in which the third sector across Scotland has responded to the pandemic. I also highlight the invaluable work of the third sector in my constituency of Shetland. People came together for the common good to tackle the dreadful virus and to look out for friends and neighbours, showing that our communities pull together when they are faced with challenges and demonstrating how invaluable the third sector is.

Voluntary Action Shetland had the fantastic idea to launch the Shetland community spirit awards 2020 earlier this year, to recognise and celebrate volunteering during the pandemic and those who give so much to their communities. Some 65 awards were handed out to individuals, organisations and businesses. If more evidence were needed of Shetland’s community spirit, the latest statistics from the Scottish Council for Voluntary Organisations show that there are 232 charities in Shetland—only the Western Isles has more per 1,000 people. It is estimated that 55 per cent of adults in Shetland volunteer formally, which is almost double the national average, and there are countless more informal ways that people in Shetland help out in their community.

Of course, dedicated staff and volunteers in the third sector need much more than warm words from politicians. In the SCVO’s “Third Sector Forecast 2019”, 88 per cent of respondents from rural areas believed that the sector’s financial situation would worsen. The picture will almost certainly have worsened further still this year, as organisations have been prevented from fundraising in the normal ways, while demand for services has increased.

Liberal Democrats want to see the third sector provided with as much certainty as possible, through funding from both local and national Government that recognises the contribution that they make, the demand that they respond to and the need for continuity of services. Indeed, the third sector is well placed to get things moving in the renewal and recovery phase.

The Equalities and Human Rights Committee’s letter to the Scottish Government of 29 October 2020 details that it is “disproportionately women” who are unpaid carers, and that carers faced

“barriers to realising their rights” even before the pandemic. Caring can have an adverse impact on carers’ health and wellbeing. That can be the case particularly for young unpaid carers, as their education and, ultimately, their life opportunities can suffer.

There was no respite for carers during lockdown. When adult day care services were stopped for months on end, with no light at the end of the tunnel, many were left feeling that they had been forgotten. The third sector stepped in to pick up some of the pieces. For example, the Shetland befriending scheme set up a Covid-19 telephone befriending service for people who are affected by dementia.

The committee makes the important recommendation that

“the role of unpaid carers ... be translated into actions in the Recovery Plan.”

As we rebuild from the pandemic, work to ensure that unpaid carers and their families get the support and recognition that they deserve will benefit from the third sector and the Scottish Government working together in partnership.

The Deputy Presiding Officer:

We move to the open debate.

Photo of Fulton MacGregor Fulton MacGregor Scottish National Party

As a member of the Equalities and Human Rights Committee, it gives me great pleasure to speak in the debate.

I am sure that we all agree that the third sector plays a vital role in our society. It takes on so many different responsibilities in our communities, and it has the tough but crucial job of providing lifeline services to many people. We are indebted to the sector for those services, which is why it is absolutely right that the Government invests in the region of £500 million annually in the sector.

Has not this year set out starkly the value of the third sector? The committee started taking evidence on its value before Covid-19 was even a thing—if members can remember those days. If such a thing as a person who did not value the third sector exists, they will surely value it now. When the pandemic and the greatest challenge of our lives struck, it was the third sector organisations that stepped up to the plate first in our communities. Many of them were the only link to the local community for people who were lonely and isolated during lockdown.

I volunteered, and saw some of the excellent work that was done in Coatbridge and Chryston to provide food, befriending, advice, and support to people who have needed it at this hard time. It struck me what a huge burden that was taking off the public sector, which was already stretched and doing amazing work. From Glenboig Development Trust to Kirkshaws Neighbourhood Centre; from the stay connected project to Coatbridge Foodbank and Lanarkshire Community Food and Health Partnership; from Coatbridge Citizens Advice Bureau and Albion Rovers Community Trust to community councils, church groups, and the many more that I do not have time to mention in just four minutes, I thank them all for all that they have done and continue to do.

The sad reality is that those services and many others across Scotland are still needed. Demand is very high as we go into the winter months and, of course, as we experience a second wave of Covid-19. We must continue to appreciate and value the sector fully, which is why I very much welcome the announcement of a further £15 million for the community and third sector recovery programme to support the work of local organisations.

As we move from the immediate response to the recovery, the Scottish Government will refocus part of the investing in communities fund as a £25 million community and third sector recovery programme. That will include business support and investment to help organisations to adapt their operations and income generation, in order to increase sustainability. That funding will support the third sector to continue to provide people and communities with services in response to the on-going impact of the pandemic.

The Scottish Government will begin work to explore other strands of social investment. That will include capital loans to support organisations in the sector to work together and co-locate as demand for office space declines, while leaving organisations with an asset in future years to enhance sustainability. The Government will ensure that that benefits all areas—in particular, those that are hardest hit by the crisis.

The Scottish Government is also committed to working with partners across Scotland to ensure that volunteering is for all and that we are able to tackle inequality and dismantle the barriers to volunteering.

That demonstrates the Government’s commitment to the sector, but is it enough? Possibly not. In our report, the committee has highlighted where we need to go: we need to go further.

It is also true that all the money in the world might never be enough. That is because we cannot put a price on communities coming together and responding in love and kindness, as we saw earlier this year. We have to value our third sector, fund it as much as possible and support it to thrive through the rest of this pandemic and beyond, far into the future.

Photo of Jeremy Balfour Jeremy Balfour Conservative

I welcome the debate on the value and importance of the third sector. As someone who worked in the sector for a number of years, I understand its importance in the Lothians and across Scotland.

The increase in demand for services that has resulted from Covid-19 has brought into sharp focus the tremendous importance of the third sector in the lives of many people in our communities, while living in a pandemic also continues to shine a light on the financial difficulties that many organisations in the third sector suffer.

During the Covid-19 pandemic, more than half of third sector organisations have lost funding income because of cancellation of fundraising events, closure of charity shops and so on. For example, Chest, Heart & Stroke Scotland lost £0.5 million in fundraising income in a month, in May, but has reported an 80 per cent increase in demand for its community support services. The implication for those who rely on its vital support, including disabled people who are living with long-term health conditions, and unpaid carers, is hard to overstate.

However although the impact of the Covid-19 pandemic has understandably drawn much focus and attention, the work of the committee clearly shows, as has been highlighted by the SCVO, that many of those problems were already there before the pandemic. In a poll that was conducted by the SCVO in December 2018, staff reported that they faced a battle for funding for an increase in demand for their organisations’ services, while 82 per cent of charities said that they were worried about the challenges that were being caused by funding cuts.

Third sector funding is a challenge. As an MSP, I have had the privilege of engaging with charities and of talking to many of them over the past four and a half years. The nature of third sector funding means that it is often gathered piecemeal from grants, earned income, statutory funding and fundraising. Timescales are variable, grants are unpredictable and many organisations simply do not know whether they will exist next year.

The Equalities and Human Rights Committee reported that a quarter of funding for the third sector comes from public sector contracts, many of which are funded by local authorities. Despite continual increases to the Scottish budget, the Scottish National Party has been raiding council budgets to fund its pet projects. That has run down local services and pushed the third sector to the limit. Since the SNP came to power, local government funding as a percentage of Government spending has fallen from 35.9 per cent to 33.1 per cent. That has had a damaging effect on the third sector. Organisations find it difficult to plan for the future and are unsure about what tomorrow will bring.

As Ruth Maguire pointed out, if the crisis has done anything, it has shown us that we need a third sector that can work in partnership across different sectors. The sector’s work will always be hampered while people have to go after the same pot of money. The Scottish Government and politicians need to address that.

The Scottish Conservatives would give councils a fair deal to ensure that they could fund our vital third sector. [

Interruption

.] I cannot take an intervention; these are my final few seconds. We would create a permanent financial settlement for councils, to stop the need for them to work out finances year by year, and would instead create three-year funding packages with ring fencing to ensure that the third sector would know what it will get.

We must all appreciate the vital role of the voluntary sector in our communities. Warm words are not enough. They must be backed up with money and long-term funding.

Photo of Annabelle Ewing Annabelle Ewing Scottish National Party

I am pleased to speak in this debate on valuing the third sector.

Let me briefly respond to something that the Tory member who just spoke said. Mr Balfour referred to SNP “pet projects”. I do not know whether he was referring to the important initiative that ensures that hungry children are fed—the Scottish child payment—which has been described as

“a game-changer ... to end child poverty in Scotland”,

or to the £100 million winter hardship fund, which will give families who are really struggling a bit of help to get through the winter. I will leave that there.

I commend very much the work of the Equalities and Human Rights Committee, which produced an excellent report. We understand why we are debating it only now, some months after it was published. I also commend the organisations that took the time to participate in the various processes in which the committee engaged, as it sought to elicit as many views as possible.

In advance of today’s debate, members received from excellent third sector organisations many submissions, setting out actions that they have taken in recent months and, of course, asking for funding. I am sure that those requests have also landed on the Cabinet Secretary for Communities and Local Government’s desk and that she will look at them carefully as we come to the budget period.

I was particularly struck by the submission from Samaritans. At this time of anxiety, uncertainty and upset, after many long months of Covid-19 restrictions and as we prepare for Christmas, it is important to flag up that Samaritans will, as always, be there for people who need emotional support over the Christmas period. There is a free helpline, and confidentiality is guaranteed. Its number is 116123. I urge anyone who feels that they need help to contact—by phone or email—Samaritans, whose staff are trained to provide assistance.

As has been mentioned, the third sector has been pivotal in Scotland’s response to the pandemic. It has been there to help people and communities to get through, which is why I was pleased that, at the beginning of the pandemic—which seems to be a long time ago—the Scottish Government announced the £22 million resilience fund. The Government managed—through, I am sure, a lot of hard work behind the scenes—to get the fund open for business as early as 25 March.

That fund, together with other funding streams that were subsequently made available, has been pivotal in ensuring that the third sector could do what it is excellent at doing, which is helping individuals and communities to get through the challenges that face them—in particular, the challenges that have been generated by the pandemic.

During that time, there has been discussion about what will happen next. I am pleased that, in the programme for government, the Scottish Government announced the £25 million community and third sector recovery programme, which is intended to help third sector organisations through the challenging circumstances that we continue to face and the new circumstances that we face as a result of Covid, and to adapt the way in which they operate and generate their income. I am sure that that fund will be very important in helping third sector organisations to do just that.

There is also consideration of a possible capital loan scheme, because many organisations will need to co-locate with others in one setting, due to the decline in demand for office space.

A lot of activity has been undertaken by the Scottish Government to help the third sector to get through to the other side of the pandemic. I take this opportunity to commend the evident commitment of the Cabinet Secretary for Communities and Local Government, who has shown her determination to fight her corner for her department and to make a real difference to people’s lives.

I thank every single volunteer, charity worker and community champion who has gone the extra mile to make such a difference in my constituency of Cowdenbeath and across Scotland. Speaking of my constituency, it is important to thank, once again, the volunteers at the EATS—Edible and Tasty Spaces—Rosyth project and Oor Wee Cafe in Kelty. The other weekend, fantastic volunteers spent their whole weekend collecting food and financial donations from the generous communities of Benarty and Lochgelly. In just one weekend, they collected more than 3,000kg of food and more than £2,200. Where on earth would we all be without such determined volunteers and outstanding communities?

Photo of James Kelly James Kelly Labour

This is a timely debate, and it gives Parliament an opportunity to thank those in the third sector who have made such a tremendous contribution during the pandemic. As a Glasgow region MSP, I thank the many citizens advice bureaux throughout Glasgow that have stepped in and done such excellent work. I also thank organisations such as Leap in Halfway and Healthy n Happy in Rutherglen, who have been at the centre of many community efforts.

I thank the Equalities and Human Rights Committee for its report and the work that it has done, which lay a good platform for the budgetary challenges that the third sector faces in the upcoming 2021 budget. The pandemic not only makes demands on the budget but makes tremendous demands on the third sector.

There have been health challenges for people during the pandemic. People have been left isolated. There have been employment challenges—people have lost their jobs, had to work from home or do part-time work—which has left a lot of people vulnerable and needing help. That is where the third sector has been required to step in.

There has been a particular challenge for women. I was concerned to read in the Engender briefing that the number of unpaid carers in Scotland has recently gone up 392,000 to 1.1 million; 61 per cent of those carers are women. Those organisations have highlighted the impact that the pandemic has had on women, and that will be a focus of budgetary demands going forward.

Clearly, we also need to consider how money is allocated. Although it is welcome that a resilience fund has been put in place, it deeply concerns me that South Lanarkshire has not been fairly treated. If we look at the allocations per head of the grants that were paid out, we see that South Lanarkshire Council got £1.05 per head, which is the third lowest amount in Scotland. Compare that to the Western Isles, which got £15.05 per head.

Photo of Aileen Campbell Aileen Campbell Scottish National Party

I am not sure which fund James Kelly is referring to, but I urge him to look at the information that we have published across a range of different funds to see what other areas South Lanarkshire has been supported in.

Photo of James Kelly James Kelly Labour

To answer directly, I am quoting from appendix 1 of the analysis paper on the Scottish Government’s website. I also point to the fact that Highland Council was paid £1.273 million from the resilience fund and South Lanarkshire got only £337,000.

Photo of James Kelly James Kelly Labour

Do I have time, Presiding Officer?

Photo of Christine Grahame Christine Grahame Scottish National Party

There is, indeed, time and it is a debate, so it is up to you.

Photo of Aileen Campbell Aileen Campbell Scottish National Party

I urge the member again to look at not only the third sector resilience fund but the community wellbeing fund and the supporting communities fund, and to look at South Lanarkshire’s allocation across the range of different funding streams that have been distributed to a range of local authorities.

Photo of James Kelly James Kelly Labour

I am looking at the terms of this debate. We are looking at support for the third sector, and it concerns me that Highland Council is getting nearly £1 million more than South Lanarkshire Council. The front-bench ministerial team well understands South Lanarkshire and the demands on the third sector there, so it is of great concern that South Lanarkshire Council has received £1 million less than Highland Council. I mean no disrespect to Highland Council for securing that allocation, but we need to be given much more support than we have received from the resilience fund.

There are significant issues in relation to—

Photo of James Kelly James Kelly Labour

Is there time, Presiding Officer?

The Deputy Presiding Officer:

Everybody is looking at me with anticipation—I feel so powerful. Yes, you can take the intervention, Mr Kelly.

Photo of Emma Harper Emma Harper Scottish National Party

In comparing sums of £1 million and £500,000 for different regions, do we not need to dissect those amounts further? Issues of rurality need to be considered, whether in South Lanarkshire or the Highlands.

Photo of James Kelly James Kelly Labour

I accept that, but I point the member to the fact that Covid has presented significant challenges for areas of South Lanarkshire such as Cambuslang, Rutherglen, Hamilton and Clydesdale; the area is in a level 4 lockdown, so the third sector will face much more demand than other areas of Scotland. The question that I keep posing must be posed: why is the funding that those areas have received from the resilience fund significantly less than the funding for other areas?

As I was going on to say, there are real issues for the budget in relation to the third sector, because demand is going up and the ability of those third sector groups to fundraise has been limited, so their funding is also limited. Aside from the issues that I have raised in relation to examining the budget for next year, we need to look at how much money is available to the third sector and how it should be distributed.

I am glad that I have provoked a wee bit of debate. I thank the committee for its report, because it shines a light on the significant work that the third sector carries out and the question of how we fund the third sector to deal with the issues that the pandemic has brought forward.

Photo of Rona Mackay Rona Mackay Scottish National Party

I am pleased to speak in the debate at a time when the voluntary sector has never been more important. Of course, we know that the sector is vital all year round in normal times. It is a crucial partner that is embedded in our society.

Frankly, all Governments rely on a functioning and well-run voluntary sector, because it is a core partner to the work of Government.

Supporting businesses has been central to dealing with the pandemic, and rightly so. All businesses are being hit extremely hard, and it is right that they should be given a lifeline. Thousands of jobs are at stake, and it is an incredibly worrying time for businesses. However, the voluntary sector should be considered in an equal light, because a society cannot function without the great work that it does.

The helpful briefing from the Scottish Council of Voluntary Organisations reminds us that voluntary sector funding in Scotland is complex and precarious. As others have said, and as I know from my constituency, most third sector organisations operate through a jigsaw of statutory funding, fundraised income, earned income and grant income. The SCVO says that there is no silver bullet for the funding issues that the third sector faces. It welcomes the Scottish Government’s financial support, but says that even with that investment, there is continued financial uncertainty for the sector, with 20 per cent of charities reporting a critical threat to their financial viability in the next 12 months.

The equality and human rights budget allocation has been significantly increased and now stands at its highest level: £30.2 million, which is up from £24.6 million in 2019-20. Crucially, there is the £25 million community and third sector recovery programme, which aims to support charities, community groups, social enterprises and voluntary organisations that are supporting people and communities through the shift from lockdown to recovery. I am delighted that the Scottish Government is also increasing support to the violence against women and girls sector through revised funding streams, and supporting work to embed equality and human rights more firmly across Government.

That is the good news, but these are not normal times. The third sector and, in particular, social enterprises have been severely impacted during the crisis, and citing figures and statistics does not always mirror what is happening on the front line. There is no doubt that the third sector would have a much greater chance of securing regular and realistic funding if the Scottish Government had the necessary financial levers. Not knowing what our budget allowance from Westminster will be from one year to the next severely hampers our ability to reassure the sector of sustained funding.

That said, the Government has committed to seek to extend three-year rolling funding where possible, and it is actively progressing that work by striving to confirm future grant offers before the preceding funding period ends. We know that local support is normally the responsibility of the local authority, and the Government is encouraging all funders to consider longer-term funding, wherever possible.

In my Strathkelvin and Bearsden constituency, we are extremely fortunate to have a thriving voluntary sector. In fact, my constituency office adjoins the East Dunbartonshire Voluntary Action office, which is a fantastic body that co-ordinates the many strands of voluntary agencies throughout the area. As has been the case in other areas, during the pandemic, the sector has come into its own—from new community groups that are working to deliver food and help to vulnerable residents, to established agencies that are working 24/7. Like others, I thank those groups sincerely. The acts of kindness, generosity and compassion across our communities have told a story about Scotland and its people that we need to celebrate and build on.

We have seen the enormous contribution that the voluntary sector has made during this terrible pandemic. We must build on that work, because a thriving third sector is vital to Scotland and is an essential partner to Government.

The Deputy Presiding Officer:

Your microphone is off, Ms Harris. Is the card working properly? [

Interruption.

] Oh goodness—that is exciting. You will have to move seats, because the microphone needs to be on for the official report. Can you move to another seat? I realise that that is not exactly the best system. That happened to me the other day, so we have that in common.

I will take Emma Harper, if she is ready, and we will come back to Alison Harris. Ms Harper, you have lift-off.

Photo of Emma Harper Emma Harper Scottish National Party

Thank you, Presiding Officer—I am ready.

Although I am not a member of the Equalities and Human Rights Committee, I am interested to speak in the debate, as I have had much involvement with third sector organisations across Dumfries and Galloway. I, too, thank the members of the committee and its clerks for all their hard work in producing the report, and everyone in the sector for all their hard work, especially during the Covid-19 pandemic.

I am the deputy convener of the Health and Sport Committee. Earlier this year, it conducted a short inquiry, the report on which is entitled “Social Prescribing: physical activity is an investment, not a cost”. The report that we are considering today, “Valuing the Third Sector”, has many similarities with that report. One of the overarching conclusions in the Health and Sport Committee’s report was that there is not enough investment in social prescribing activities, which can help to support people’s physical and mental health and wellbeing. Many of those social prescribing activities are delivered by third sector organisations, such as Third Sector Dumfries and Galloway.

The third sector plays a crucial role in supporting community development and inclusive growth, and in providing lifeline services, facilities and employment to people across Scotland. The third sector also provides funding for life-changing social prescribing models to help people with a range of health conditions, from depression and anxiety to addiction and isolation.

One example of a fantastic partnership project is the River Garden Auchincruive in Ayr, which I have spoken about many times in this session. It is a residential alcohol and drugs recovery service that uses a social prescribing approach to recovery from alcohol and drugs misuse. The team did well to engage the community, reduce stigma and enhance the human rights of the River Garden residents. The programme works in partnership with the third sector and receives third sector funding. It is a strong example of the partnership working that is called for in the Equalities and Human Rights Committee’s report, which Ruth Maguire described in opening the debate, and of how supporting the third sector can, in turn, help to support people, our society and our economy. It is interesting to read the conclusion in paragraph 137 of the Equalities and Human Rights Committee’s report, in which the committee

“asks the Scottish Government to direct or encourage a greater focus on human rights and partnerships with the third sector within the budget allocation process.”

I welcome that.

I also welcome the Government-funded third sector resilience fund, which opened for applications on 25 March. It has been a welcome lifeline for many organisations across Dumfries and Galloway and Scotland. Through the fund, £22 million was made available as part of the £80 million that was allocated to the third sector, which enabled community organisations such as Third Sector Dumfries and Galloway to offer grants to community groups across Scotland, as well as to support their own efforts to prevent social isolation and loneliness during the pandemic. I volunteered with Third Sector Dumfries and Galloway during the initial lockdown. I participated in the telephone touch base scheme, which enabled me to speak to people who identified as being at risk of isolation or loneliness as a consequence of lockdown.

There is no doubt that the third sector resilience fund helped many people across Scotland, and I appeal to the minister to ensure that the new £25 million community and third sector recovery fund continues to work to tackle isolation and loneliness, as well as funding lifeline services across Scotland.

I again welcome the engagement and support that the third sector has provided for River Garden Auchincruive and look forward to that continuing. I echo the findings of “Valuing the Third Sector” in emphasising the importance of valuing the third sector, and I appeal to the Scottish Government to ensure that it is funded adequately to enable the fabulous, outstanding work that the third sector does to continue in the future.

Photo of Alison Harris Alison Harris Conservative

Before I begin, I declare an interest: I am involved with a third sector charity. I refer members to my entry in the register of interests.

The third sector in Scotland is in a dire situation. All across the country, organisations that cover every imaginable cause have never faced a more worrying future. If that were not the case, the Equalities and Human Rights Committee would never have needed to undertake its inquiry, and we would not be debating its findings today.

Of course, the Covid-19 pandemic, which has brought the world to its knees, has certainly not helped matters, but the sector was in big trouble even before then. Most of the problems that are set out in the inquiry report predate the pandemic. Let us be honest: that is, in part, very much due to the Scottish National Party Government’s approach to council funding. The Government should not hide behind Covid when the actual reason for the situation that we are in is 13 years of domestic failures. [

Interruption

.] I will make some progress, thank you.

The stark situation that charities face is, in part, a result of a political choice and is not all down to a misfortune of circumstances.

Without local government cash, charities and voluntary groups can barely keep the lights on. They need core funding to enable them to operate. The consequences of their struggle to stay afloat are far-reaching. Whether we are talking about children in poverty, women fleeing domestic abuse or local groups that provide care to adults with learning difficulties, the third sector is an irreplaceable fixture in Scottish society.

It is not just those in desperate trouble who benefit from third sector organisations. They help people improve their skills and careers and more than play their part when it comes to aspiration and people reaching their potential. Evidence that was given to the inquiry described the depressing state of affairs that is faced by many groups that are trying to improve the prospect of normal Scots. Equate Scotland, which aims to get more women involved in science, has said that it can no longer provide one-to-one career clinics that support women seeking work. Why would any Government be satisfied that that kind of problem was developing under its watch? A Government that was serious about the third sector would not allow that to happen.

The third sector has a great deal more to offer than simply helping people at their lowest ebb, although that is a crucial factor too. The voluntary sector employs more than 100,000 people in Scotland—around 3.4 per cent of the workforce. They are talented people who provide economic benefit by paying their taxes and contributing to society.

Even before lockdown, the SNP planned to cut council budgets by more than £200 million. [

Interruption

.] I will make some progress, thank you.

If the pandemic has taught us anything, it is that charities and voluntary groups that put the needs of others before their own make an immense contribution. I put on record my personal thanks to everyone involved.

Society cannot afford to live without the third sector, and nor can the economy. Therefore, we need a commitment that the Government will support the sector. It can start by adopting the Scottish Conservative proposal to create a permanent financial settlement for councils, ring fencing vital money.

Let us not forget that the work that is carried out by third sector groups would in many cases fall on the state if they were to collapse. Therefore, the Scottish Government must heed the evidence of those who took the time to get involved in the inquiry, and we must all ensure that, the next time that Parliament meets to discuss the third sector, it is to pay tribute to its remarkable contribution rather than to discuss threats to its very existence.

Photo of George Adam George Adam Scottish National Party

I thank Ruth Maguire and her committee for the excellent work that they have done on what is an excellent report.

I have always valued the third sector and have always felt that it plays a crucial role in our communities. From my early days as a councillor on Renfrewshire Council, I could see that the third sector provided not just a different way to deliver services but, in many cases, a better way. I can see that the Scottish Government wants to create the best conditions for the third sector and voluntary sector to thrive and to contribute to the recovering economy and society. The announcement of the £25 million investment is a perfect example of that.

Many people can talk about what the third sector did in our communities during lockdown, and many have done so today. Many third sector organisations in Paisley did great work, but I will stick with one organisation and its many component parts: St Mirren Football Club.

Many football teams claim to be more than just a football club but, in the case of St Mirren, that is true. During the lockdown, the St Mirren Charitable Foundation delivered emergency packages throughout the town and worked with first team players to ensure that the supporters were okay. Gayle Brannigan of the foundation is a force of nature. She ensures that the foundation delivers for the people of Paisley and is always out and about, getting the funding that the organisation needs.

I declare an interest in relation to what I will say next, as I am the convener of the St Mirren Independent Supporters Association. St Mirren FC is part of a pretty unique partnership. In 2016, SMISA and local businessman Gordon Scott set out on a journey towards fan ownership. Under a 10-year plan, SMISA was to own a majority of the shares in the club by 2026, which would ensure that our club was never the plaything of a currently wealthy person or of those who were attracted by the big bright lights of professional Paisley football.

This is where it gets extremely interesting. SMISA will own a majority in the club next year, after entering into a unique partnership with the Kibble Education and Care Centre, which is a charitable organisation that has been around in Paisley since 1840. Two of the town’s great institutions—Kibble from 1840 and St Mirren from 1877—have come together to work in a unique way.

We took the German football club model. In Germany, the commercial partner tends to be a major public limited company or organisation, but we have done the Scottish thing of going for a third sector organisation. What club can we say is delivering for young people in Scotland? Many of the young people who Kibble works with go on to work in hospitality. If we can find a way to use the club to make life better for them, so much the better. That is the unique difference of our partnership.

Instead of being fan owned in 2026, St Mirren will be fan owned next year, through SMISA working together with Kibble. That has not been easy—it has been difficult to bring together businesspeople, a charitable organisation and volunteers. However, nothing that is worth while is easy in life—we must step up to the challenge and do it. I have always been a great believer in being positive and finding a way to solve the problems that face us.

The way in which St Mirren Football Club and Kibble are working towards one goal and moving forward is the future for Scottish football and fan ownership in Scotland.

Photo of David Stewart David Stewart Labour

I am delighted to close for Labour in this excellent debate on valuing the third sector, which I congratulate the Equalities and Human Rights Committee on securing. The convener, Ruth Maguire, set the scene well when she stressed how embedded the third sector has been in all our lives, not least during the pandemic.

Every member has a connection with the sector—whether it is personal, through family or through work and leisure. I am no different. I volunteered with the Samaritans in Inverness in my early 20s; I worked as an assistant director for the SCVO in my late 40s; and now, in my early 60s, I am a trustee of the Scottish Cot Death Trust, which supported my family through a time of grief and sorrow.

In its briefing, the SCVO makes the key point that,

“During the pandemic, a light was shone on the financial vulnerability of the sector”.

Many organisations had to cease trading, public funding was halted and demand for services and support increased significantly for many organisations, while others could not operate at all.

Many members, including Rona Mackay, Fulton MacGregor, Jeremy Balfour and James Kelly, argued that third sector funding is complex and precarious. Do we need a new compact between the Scottish Government and the sector, to ensure the sector’s long-term financial sustainability? Surely the time is right to look for a new funding model that will ensure that human rights and equalities take centre stage.

As the NSPCC briefing aptly puts it, the Covid-19 crisis presents an

“opportunity to make meaningful, sustainable, transformative change. We need to harness the desire to do things differently, to reach out to families with a strengthened social safety net to prevent longer term dif?culties developing in children and young people’s lives.”

I was struck by the consistency of positivity in the speeches, if I can put it in that way. Rachael Hamilton said that the third sector is crucial and invaluable to our society, and the minister said that the third sector’s work started long before the pandemic and will continue long after it ends. Pauline McNeill said that 20 per cent of the charity sector faces financial crisis during the next 12 months, and Beatrice Wishart talked about paying tribute to the third sector during the pandemic and made specific reference to Shetland.

I believe that this has been an excellent debate, with well-informed and insightful speeches from across the chamber. We owe the third sector a deep debt of gratitude for the work that it carries out in Scotland—not as an optional extra, but as a key component of our welfare state. Surely the message from the chamber is that we value the third sector in strengthening our communities, delivering vital services and building a wellbeing economy.

Scotland’s budget for 2021-22 offers an ideal opportunity to embed the third sector as a key player by creating sustainable funding and reinforcing its partnership role in a fairer, greener nation. As John Holmes famously said:

“There is no exercise better for the heart than reaching down and lifting people up.”

Photo of Alexander Stewart Alexander Stewart Conservative

I am delighted to close on behalf of the Scottish Conservatives in this debate on valuing the third sector.

Having served as a local councillor for 18 years, I am well aware of the work that takes place across the sector. We have heard about the 40,000 charities in Scotland that are supporting individuals and organisations the length and breadth of the country. There is no doubt that they play a crucial, positive role in supporting individuals day to day.

The third sector has had a vital role to play throughout the pandemic that we are suffering at present, which has ensured that, as we move towards the recovery that will take place in the weeks and month ahead, we will see the third sector continue to shine. Its organisations and structures are there to support people on the ground, and it has the expertise and agility to adapt to the changing circumstances and environments that it faces. However, we have heard about the significant amount of public sector money that is required to ensure that the third sector can thrive and survive, and many organisations faced difficult times prior to the pandemic.

The question of sustainable funding has been raised repeatedly. Many organisations rely on significant levels of funding, and the third sector has struggled to ensure that it is continually supported. We have heard about the funding packages and multiyear funding that some sectors and organisations receive, but not all of them are in that fortunate position. They rely on local authorities to support them, and, since the Scottish Government has come to power, there has, without question, been a real-terms funding gap in local government. That has been taken on board by many organisations and individuals, and some charitable organisations in the sector have said that local government funding is a major issue. We need to understand that and support local authorities to ensure that they have that involvement.

The Scottish Conservatives want a fair deal for local councils. That will require the Scottish Government to ring fence a percentage of its budget, year on year, to ensure that local government funding follows something similar to the Barnett formula. If that had taken place, hundreds of millions of pounds could have been poured into local government. Instead, we have seen hundreds of millions of pounds removed from local government. The Scottish Government has also ensured that the budgets of many in the third sector have reduced since 2014.

Photo of Aileen Campbell Aileen Campbell Scottish National Party

I hear the largely conciliatory tone that Alexander Stewart is using. However, I want to put on record the fact that the Scottish Government has endeavoured to treat local government fairly. Local authorities have enjoyed a cash-terms revenue budget increase of 3.6 per cent between 2013 and 2020. If we look at what the member’s own party has done to English local authorities, we see that there has been an equivalent real-terms reduction of 22.8 per cent.

Photo of Alexander Stewart Alexander Stewart Conservative

I thank the cabinet secretary for her intervention. Funding for Scotland’s local authorities has been reduced year on year, in real terms, since the SNP Government came to power 13 years ago. Those reductions in funding do not help when they lead to a reduction in council services. Age Scotland has said that the third sector is being used to plug the gap where services were previously provided by the public sector. Equate Scotland, a charity that aims to get more women into science, has said that it will be unable to support some of those individuals because its costs have increased while its funding has remained stagnant.

I pay tribute to Ruth Maguire, the committee’s convener, who spoke about the engagement that has taken place. Committee members have gone out to listen and talk to many individuals and organisations that play a vital role.

We have talked about partnership working, co-location, information sharing and respect for the third sector, and those are all vital. Pauline McNeill talked about community groups having provided support during the pandemic. They have made an effort and have saved many people from the depths of the pandemic, providing respect and support.

Jeremy Balfour talked about the difficulties of income loss for many charities. A third of bodies in the sector have seen dramatic decreases in their support.

I hope that the Scottish Government will support the Conservative amendment and will consider the committee’s conclusions before the end of this parliamentary session.

The Scottish Conservatives fully support the excellent work that the third sector does. Those groups play a vital role in ensuring that everyone is valued and looked after. Excellent work takes place every day, and many organisations have gone above and beyond that during the pandemic. We must not see them disappear, because they plug the gaps. I am delighted to participate today, and I pay tribute to every volunteer who has gone the extra mile to support our communities.

Photo of Aileen Campbell Aileen Campbell Scottish National Party

I am pleased, on behalf of the Scottish Government, to close this important debate about the third sector and how it can be supported.

I place on record my thanks to the countless third sector organisations throughout the country that have done an inordinate amount of work over the past nine months to support and look after our communities. I also put on record my thanks to the committee for its hard and thorough work. The committee has heard directly from a wide range of third sector partners and has used that evidence to instruct a valuable report.

Although Covid interrupted the timing of the debate on that report, it is useful to have the discussion now. The past nine months and the impact of Covid have shown just how important the third sector is to our people, our communities and our country. Those organisations’ reach, the variety of what they provide and the compassion that they show have been, as the SCVO’s campaign slogan captures, never more needed.

That is why, early in the pandemic, I announced £350 million for our communities, our local authority partners, the third sector and TSIs to help to support and ensure our national resilience. Throughout the pandemic, I kept in regular contact with the third sector partners who were helping to administer the funding. We are grateful for what they did and grateful also to the third sector partners who were delivering on the ground.

There were groups in Orkney, the Western Isles, Glasgow and South Lanarkshire. James Kelly will be happy to know that I engaged with Healthy n Happy. I met Healthy Valleys in my constituency, too. We also met the impressive Falkirk TSI, which Ruth Maguire mentioned in her introductory remarks. The third sector interface in Falkirk, supported by Stenhousemuir Football Club, again illustrates the point made by George Adam about how instrumental our football clubs have been to community resilience. Stenhousemuir is one of those.

The groups all act with compassion and care, and they do what works in the context of the communities that they know best. In response to that, we delivered the funding with flexibility and with trust. Partnership flourished at a pace and scale that we do not want to lose.

That is why, among the trauma and awfulness of the pandemic, we are determined to capture the good changes, the things that worked and the messages that we have had from the third sector over the past nine months about feeling valued, supported, trusted and respected. Even though the unfortunate prompt was a pandemic, we need to use this moment to improve what we do and how we value our important third sector. That is why my colleague Shirley-Anne Somerville and I established the social renewal advisory board, with a key focus on what we need to change and the system that we need to disrupt to protect the third sector. The third sector and volunteering circle is examining how we do that, and the social renewal advisory board will report to us very soon.

In response to a demand for a move away from resilience towards recovery, we announced a £25 million community and third sector recovery programme in this year’s programme for government. The programme, which opened for applications on 21 September and will run until March of next year, is designed to help charities, community groups, social enterprises and voluntary organisations to continue to provide on-going crisis support to those in need.

The programme has two elements. One is adapt and thrive, which will assist organisations to plan and implement changes to their operating models and working practices to enable them to continue to operate in a very different social and economic climate. The other element is communities recovery, which will support organisations in planning and restarting the delivery of existing services for communities and/or the development of new services that are identified as a priority due to the impact of Covid. As part of the winter support package, we will expand the programme and invest a further £15 million in it. That funding will be used to enable more community and third sector organisations to feel supported and to ensure greater resilience.

We are taking those actions and providing that funding because, if recovery is to be about more than just reverting back to the old ways of doing things, we need a flourishing third sector. For us to translate the ambition of the national performance framework into reality, we need the third sector. Therefore, I agree that funding needs to be multiyear. I have endeavoured to provide that in my portfolio, but we need it to happen more widely across the rest of Government and wider public life. We also need to respect the third sector, which is why, in response to the advisory group on economic recovery, we committed to work with local government and the third sector to address the barriers that face the sector. That is taking on board the steer from the committee, and, no doubt, it will also be among the recommendations from the social renewal advisory board.

I must point out that it feels as though the Tories are attempting to politicise what has largely been an instructive debate. They need to realise that the funding situation is not helped when we continue to get a one-year budget or that budget continues to be delayed. It does not help that we have continued Brexit uncertainty and it does not help the third sector—[

Interruption

.]

If the members who are shouting from the side would care to listen to people in the third sector, they would say that callous welfare cuts certainly do not help the sector to survive and thrive. However, let us not get bogged down by the attempts to hijack the debate, because that is not what people in the third sector want from their Parliament. They want their Parliament to work together to ensure that the sector continues to flourish.

We have opportunities ahead, and we will be instructed by the really useful report that Ruth Maguire has led on. We have the opportunity of the recommendations that will come shortly from the social renewal advisory board. We have provided funding to help the third sector to adapt and thrive and to cope with the new situation that it is experiencing.

We desire to move to using wellbeing and away from gross domestic product as the simple way of determining whether we are a successful country. Along with that, we will need the third sector to flourish. We need the sector to be respected and to be at the head of decisions on budget, not at the coo’s tail, which is quite often what happens. We need to continue to work with the third sector in partnership and to have it alongside us on the journey, as that is the only way that the sector will be able to continue to flourish.

The Deputy Presiding Officer:

It is a while since I have heard the coo’s tail mentioned, but there we are. I call Mary Fee to close for the committee.

Photo of Mary Fee Mary Fee Labour

It is a pleasure to close the debate on behalf of the Equalities and Human Rights Committee. The importance of the work that the third sector carries out has shone through members’ speeches. Many of our constituents rely on the services and advocacy that the voluntary sector provides to lead their lives or to help them when they face particularly difficult times.

That has been evident in my area in the west of Scotland through the work of Home-Start. Its tireless efforts to support vulnerable young families in a variety of ways over the past nine months, including supplying food and providing children’s activities have meant that 118 families across Renfrewshire have had some of their burden lifted.

As Pauline McNeill highlighted, the third sector has become a beacon in the community during the pandemic by providing essential services to our most vulnerable. Beatrice Wishart spoke of the valuable work that the third sector does in Shetland, and praised the Shetland community spirit. I take this opportunity to associate myself with George Adam’s remarks about St Mirren Football Club and Kibble in Paisley and the fantastic work that they continue to do.

One of the central themes of the committee’s report is the increasing demand for services, while funding is being reduced. Almost all the written submissions that we received highlight the funding challenges or express the view that public funding for the third sector should be increased.

Age Scotland believed that the voluntary sector is often left to “plug the gap” for services that were previously publicly funded, and other groups faced increasing demand at the same time as their budgets were being reduced. The Health and Social Care Alliance reported a growing trend for local authorities to demand that

“third sector organisations deliver services ever more cheaply”.

In response, the Convention of Scottish Local Authorities argued that the funding of third sector organisations fell predominantly within the unprotected portion of council budgets and that in the 2019/20 budget, only 39 per cent were unprotected. When savings had to be made, however, COSLA said that

“councils have no choice but to take any necessary savings from service areas that fall within the non-protected area”,

meaning that budgets on wellbeing, infrastructure, the economy and the creation of sustainable communities were affected. Cuts were amplified in those areas and a 2 per cent cut in overall budgets became at least a 5 per cent saving from non-protected areas.

Jeremy Balfour spoke of the concerns that local authorities have raised and must deal with day to day. Members from all parties raised concerns about funding and called attention to the fact that 20 per cent of charities in Scotland do not think that they will be financially viable in 12 months’ time.

Those tensions demonstrate the need for closer partnership working across central and local Government, other funders and the voluntary sector. It is clear to the committee that the current approach is not working and is not sustainable in the long term, particularly as we enter a period of uncertainty due to the health crisis, in which there are already signs of continued increase in demand for services.

As the committee’s convener outlined, there is a need for a long-term funding model for the voluntary sector. Short-term funding of one year or less creates unnecessary churn for charities. They spend time and resources applying for funding and the people who work in the sector face the constant threat of losing their jobs if funding applications are not successful. That also results in time and money being devoted to recruitment and training, adding a further burden and diverting resources away from front-line delivery.

I welcome the minister’s comments in her opening remarks about the move to multiyear funding. However, concerns remain, as speakers from all parties have pointed out. Short-term funding means not only that charities lose talented employees, but that they risk vital projects being compromised due to time and financial constraints.

The Covid-19 crisis has made the need for long-term planning ever more urgent, as unprecedented challenges and threats have emerged. The pandemic has brought to the fore many pre-existing issues relating to the long-term sustainability of the sector.

The Scottish Government’s support for the sector during the pandemic has been welcome, but some groups are falling through the gaps and are facing difficult times.

The issue of the accessibility of funding streams arose during our 2019 deliberations on the third sector. We heard from the Fife Centre for Equalities about how challenging it is for smaller equality groups to access funding and, last month, in relation to the emergency funding provided by the Scottish Government, we were told that organisations in Glasgow serving ethnic minority populations did less well than expected in accessing emergency funding. It is vital that the Government ensures that parity of access to funding is achieved and the committee urges it to heed the concerns that have been raised during the debate and in our reports and to revisit what it can do to support the sector, to ensure that there is equal access to funding.

We know that reduced budgets and short-term funding contribute to a gap between national policy aims and the experience of the third sector and service users on the ground. Several examples of the failure of the system to protect rights were provided by those who attended the Glasgow TSI event in 2019. A number of participants described the people whom they support as being afraid of public services—housing, immigration, social security, criminal justice and social care were specifically mentioned. We also heard concerns about disabled women not having access to key health services or screening and about women who were fleeing from violence not being able to access housing or other key services. Those are not a result of the pandemic; they are pre-existing concerns that we know will have been exacerbated by the health crisis.

In the Minister for Older People and Equalities’ response to our report, she emphasised the role of prevention, close partnership working and outcomes-based performance to improve outcomes and tackle inequalities in a sustainable way. We have heard today that there has been very little progress on the outcomes for the sector and the people who rely on it. The committee therefore urges the Scottish Government to do more to address those very serious concerns.

I thank again everyone who took part in the debate. It is clear that not only is there widespread support for the third sector, but a great deal of respect from members across the chamber for the valuable work that it does in all our communities. I support the motion in the name of Ruth Maguire.