New distributor: the vision

back to the contents page

A new joint NOF/CF paper reveals quite a lot more about the likely shape of the new distributor. Here we offer a digest and commentary on its contents

Make sure you receive your fair share of lottery cash - take out a no-obligation trial subscription today.

The introduction to Shaping a new distributor, or the ‘vision document’ as it is being called by NOF and CF insiders, states that it is intended ‘to inform the Lottery White Paper and subsequent legislation’. The document represents the clearest picture to date of how NOF and the Community Fund see the new distributor working. There are two sections: principles and programmes.

KEY PRINCIPLES
The first principle serves in effect as the new distributor’s mission. The next three principles directly address each of the main concerns raised by the voluntary sector since the merger announcement: independence, additionality and protection for voluntary sector funding streams. The opening statement is: ‘Through its funding of pro-grammes and projects, the new distributor will make real and sustainable improvements to the lives of disadvantaged people and to the well-being of local communities.’

On independence, the document promises that ‘all decision-making on funding applications will be transparent and independent of government control.’ This says nothing, of course, about priority-setting or strategic frameworks against which individual applications are judged, which is the level at which critics of NOF have always seen its independence as compromised. However, there are reassurances on that broader front, too, which appear later in the document.

On additionality, the document states that its funds will be ‘additional’ to spending by statutory bodies including government, the devolved administrations and local authorities. This restatement of the current tautological non-definition of addi-tionality will not satisfy anyone who believes there is an argument worth having about the concept. But it goes on to say that its funding will ‘complement’ other sources and will ‘offer different approaches’ to delivery. It then directs a warning at local authorities, thus: ‘The new distributor may also adopt funding policies which encourage local authorities and other statutory bodies to support the work of the voluntary and community sector in their areas and which make it clear that the new distributor will not intervene with additional support when local statutory funding is inadequate or is withdrawn.’ While this is again a restatement of the existing position of both CF and NOF, the emphasis is deliberate: the new distributor will not collude where local authorities withdraw support from voluntary organisations on the basis that they can always get lottery funding instead.

On guaranteed funding for the voluntary sector, the new distributor will: ‘guarantee a proportion of funding to the voluntary and community sector through the Open Grants Programmes… The guaranteed proportion will be equal to the proportion of total lottery funding currently allocated to the Community Fund

to fund the voluntary and community sector. However, this will be a minimum rather than a maximum figure.’ The final sentence here will be welcome, because a guaranteed proportion of a declining lottery pot should not be of great comfort to the voluntary sector. 

Other principles
Devolution: unless there is a compelling reason to carry out UK-wide work, the norm will be for programmes to operate at country-level and below. There is a commitment to retain the devolved ‘country and regional’ structures operated by (mainly) the Community Fund, and a promise that programmes will in practice be devolved to the most appropriate level, taking into account, for instance:

• ‘what will best achieve the intended programme outcomes
• efficiency and cost effectiveness
• political and administrative structures with which the new distributor can engage to maximise the value of, and promote, lottery funding
• customer care and accessibility for applicants.

Customer focus: In this section the document lays down bold commitments to tackle some of the perennial complaints about applying to the lottery. These will have been framed with the Secretary of State very much in mind.

It promises a single point of entry for potential applicants, with the distributor taking on the job of directing enquiries to the most suitable place – including other funders – and for providing or identifying sources of pre-application support, such as CVSs and local authority lottery officers.

There is a commitment on turn-around times: ‘The new distributor will reduce the time between an application being submitted and a decision being made (compared to current Community Fund and New Opportunities Fund arrangements), and provide helpful information to applicants during this process on the progress of their applications.’ A lot of emphasis is put on being proactive, both in this section and later on in the document. The message is that this pre-eminent funder will use its weight both with other lottery funders and non-lottery funders to streamline processes and join up funding access. For instance: ‘The new distributor could also take the lead role in encouraging access to the full range of National Lottery funding… This could include developing a preapplication support process for all distributors, further developing and enhancing the Awards for All programme, operating further joint schemes addressing particular issues or themes and providing specialist expertise to support the delivery of major cross-cutting capital projects.’ And the new distributor will apparently take the lead in promoting joint programmes and even organising joint-funding for cross-disciplinary applications on a case-by-base basis. Much of this will only be feasible if the distributors gain the financial flexibility to organise joint funding pots, which is likely to happen.

Intelligent grant-making: the main point here is that the distributor will be a learning organisation. But also, in another reference to its centre-stage role in the funding scene, it says it will ‘play a key role in levering in funding from other sources to help projects develop under its themes, and in brokering relationships and networks between projects and more widely.’ 

Targeting: The document confirms the policy of targeting geographical disadvantage, including a challenging and intriguing proposal: ‘This may include setting a minimum amount per capita that no deprived area (local authority or smaller) would be allowed to fall below without remedial action being taken.’ As reported in Lottery Monitor March 2003, Fair Share has not been conspicuously successful to date at closing the lottery funding inequality gap – no wonder this proposal doesn’t quite have the force of a full-blooded commitment.

PROGRAMMES
The key message here is that the new distributor should have more freedom of movement than NOF’s currently closely specified policy directions permit. The intention is to shape the work of the distributor through a three-year strategic plan (the Community Fund model), build from broad themes and ‘high level outcomes’ agreed with government via the DCMS; and grant programmes developed from these by the distributor. However, ‘All programmes and outcomes would have a commitment to promoting social inclusion and tackling disadvantage.’ There are to be two types of programmes: open and prescribed. 

Open programmes: These will relate to the big themes, and will not be heavily prescriptive – the document talks of ‘supplier-generated solutions’. So this is the stream that smaller community organisations in particular (and, the document says, ‘community businesses’) will be expected to tap, in much the same way as they approach the CF’s open programmes at present. Note the commitment to a light touch for smaller projects: ‘The rigour of application, assessment and management processes will be appropriate to the grant size.’ Capital and revenue will be funded, and examples of activities supported include: ‘service delivery, research, organisational development, international development, infrastructure support and campaigning.’ The document refers to four funding bands within the programme:

Micro = up to £500
Small = up to £25,000
Medium = up to £250,000
Strategic = up to £1m

Funding pots for the open programmes will be country-wide and regionally budgeted, according to population and deprivation (again, as CF currently does). Eligible categories of applicants for open programmes are: 1. Voluntary and community organisations, or partnerships led by voluntary and community organisations which include any other category.

2. Community and social enterprises (eg, Community Interest Companies, charitable Industrial and Provident Societies).

Prescribed programmes: These will be much more tightly defined, and the distributor will take a clear responsibility for ensuring that delivery meets the desired outcomes. These are going to look and feel a lot like NOF’s current range of pro-grammes, emphasising strategic, partnership-based work.

Eligible categories for these schemes will be categories 1 and 2 above, plus: 3. Statutory or commercial agencies and other non-political community-based agencies (eg schools, patient interest groups, race equality councils, primary care trusts, foundation hospitals). 

Delivery: The new distributor will call on the range of delivery mechanisms that NOF has been experimenting with. The document lists the main ones:

• UK-wide strategic decision-making for flagship projects
• devolution to the relevant country, region or local level
• delegation of a funding stream to another body
• direct allocation (the cancer scanner model)
• local decision making: local people will decide on the exact use of a block of cash awarded to them.

A further option in this list is worth highlighting, stating that the distributor will ‘have the power to provide other types of funding than grants, such as loans, endowments, venture capital and underwritten guarantees’.

And the document talks of delivering non-lottery funds through these same channels, a point reinforced later in the document: ‘The new distributor will also have the power to distribute non-lottery funding.’ An appendix to the document gives an illustration of how the whole programme set-up might look for five broad themes.