The Truth about the Third Sector
/Many people think that working in and for the Charity and Social Enterprise sector is somehow easier or less challenging than the private sector. That the ‘Third Sector’ is somehow amateurish, with lower standards and a generally friendly, warm fuzzy feeling, where shabby offices are full of well-meaning people who chat for ages over mugs of tea.
After all, the sector is all about ‘helping people’ and how easy must that be?
As a Business Development and funding specialist in the Charity and Social Enterprise sector for thirty years, I want to use this blog to explode some of those myths, because they are myths that sometimes prevent me from being taken seriously as a consultant, but much more importantly, these myths hold back the country from reaching its full potential.
The pandemic of 20210/21 has brought into glorious technicolour some deeply entrenched social problems in the UK, such as race inequality and injustice, and poverty and deprivation. The foodbank down my road, which I have been associated with for twenty years, is seeing a new type of customer – working families, where both partners are putting in the hours and doing several jobs whilst looking after children, but still, they can’t afford a supermarket trip.
In 2021. In a wealthy, developed country.
Charities and Social Enterprises take action to change not just this, but all forms of deprivation, lack, and injustice in the world. A few of the organisations I’ve been honoured to have as clients do things like:
support young black Londoners to set up businesses;
create jobs for young people with autism;
prevent elderly and vulnerable people from falling prey to scams;
find solutions to rough sleeping;
do something major about mental health in their local area;
prevent suicide;
or find links between deprivation and obesity to put in place preventative, long-term solutions.
Without these organisations, our country would be poorer, sadder and more dangerous.
The Charity and Social Enterprise sector, sometimes called the ‘voluntary sector’, or ‘Third Sector’ contributed £18.2 billion to the economy in 2018*. The sector employs 3% of the total UK workforce. It utilises volunteers, who contribute £23.9 billion of value, unpaid, to the economy every year*. The sector operates in those parts of the economy where people need services, but cannot pay the market rate for them. Organisations have to find ways to provide services, without an income stream that comes direct from customers.
Looking at the table, which type of organisation has the greater challenges?
| Charities and Social Enterprises | Private sector companies | |
|---|---|---|
| 1. | Have to generate a surplus, which is reinvested into the organisation’s purpose | Have to generate a profit, which is shared out to (already wealthy) shareholders |
| 2. | Need to cover costs through grants, contracts, public donations, social investors, philanthropists, crowdfunding, physical and online shops, and other forms of trading. | Need to cover costs from income received from sales to customers. |
| 3. | Have to attract and pay high calibre staff, even though salaries are lower and contracts of employment are often temporary or less secure. | Have to attract and pay high calibre staff, can pay attractive salaries and contracts are usually permanent. |
| 4. | Have to manage volunteers, who come with a huge range of abilities, strengths and weaknesses, and availability issues, and who can leave without warning. | N/A |
| 5. | Purpose is to deliver services (not usually products) that provide innovative solutions to entrenched social problems, which impact heavily on the NHS and on the economy. | Purpose is to find and exploit lucrative markets for products and services. |
| 6. | Subject to regulation from Charity Commission, Social Enterprise Regulator, Companies House, and HMRC | Subject to Companies House and HMRC |
After 30 years in Business Development in this amazing sector, becoming a consultant was a big decision. I was concerned that I would be seen as profiting from organisations that help people, and I was worried that charities and enterprises would be so self-sufficient that they would not allow themselves to pay for my services.
Then, in the first lockdown, I offered 65 free sessions to struggling charities and enterprises, to help them plan their way out of a financial black hole. Slowly, the realisation was made that my 30 years of experience could be applied quickly and efficiently to organisations, and that this was worth their investment.
Over half (52%) of the voluntary sector workforce is educated to degree level, this figure is 53% in the public sector and just 30% in the private sector*. Casual opinions about amateurishness are therefore unjustified, and usually stem from unthinking appraisals of an organisation’s buildings or its non suit-wearing staff.
In line with the rest of my chosen sector, I’m well-qualified too, with a set of qualis that include a Masters in Community Development, and Marketing, Management, and Accounting diplomas. I’ve done loads of income-generation-related training courses, such as an Advanced Tendering Skills course just completed, so I can always over-deliver for clients.
This is an important, if complex sector in the UK, and I am a consultant who cares enough about it, to choose it, and to want to support it. Whether as a volunteer packing food parcels, or as a Trustee.
Or, through my consultancy business, called AmVic Ltd, because it is just me, ready and able to help you.
*Statistics from the NCVO Almanac 2020
