The presentation was a workshop at Evolve 2014: the annual event for the voluntary sector in London on Monday 16 June 2014. The presentation was chaired by Anna Bloch from Charity Finance Group and shares highlights of how charities have adapted and are continuing to adapt to the climate, covering reductions in statutory funding and new fundraising strategies. Find out more about the Evolve Conference from NCVO: http://www.ncvo.org.uk/training-and-events/evolve-conference Find out more about the work NCVO does around funding: http://www.ncvo.org.uk/practical-support/funding

1. Workshops
AM7: Managing in the new normal
Chair:
Anna Bloch, Acting Senior Policy Officer, CFG
Speakers:
Ian Oakley Smith, Head of Charities, PwC
Daniel Fluskey, Head of Policy and Research, Institute of Fundraising
Paul Streets OBE, Chief Executive, Lloyds Banking Foundation
Thomas Leftwich, Senior Policy Advisor, The Office for Civil Society

2. Managing in the New Normal
Highlights of 2014 survey
16 June 2014
www.pwc.co.uk

3. PwC
Who I am
• PwC Head of Charities
• Chartered accountant and Licensed Insolvency Practitioner
• Specialist in strategy and restructuring for charities and
other not-for-profit entities
• Worked with wide range of charities and social enterprises,
typically small to mid-sized charities
• A member of the Committee of the ICAEW Charities and
Voluntary Sector Special Interest Group
• A member of the Governance and Audit Committee, The
Lord’s Taverners, a charity
Ian Oakley Smith
UK Head of Charities

4. PwC
Some key messages
A “cautious
optimism”
1
Concern
about
scrutiny
2
Greater
collaborative
working
3
Continued
innovation in
fundraising
5
Tips for a
sustainable
recovery
6
Slow interest
in social
investment
4

5. PwC
A cautious optimism?
Survey dated
Dec 08 Jun 09 Dec 09 Jun 10 Dec 11 Dec 12
77%93% 68% ??%
46% 55%

6. PwC
Under the microscope: increased scrutiny for
charities?
90%
87%
22%
49%

7. PwC
A greater collaboration
• 77% of respondents have collaborated or are thinking of it,
compared with 69% last year
• Service delivery
• Joint fundraising
• Policy research or campaigning
• 90% consider greater involvement of finance teams in strategy
Slide 7PwC

8. PwC
Still no real appetite for social investment…?
Slide 8

9. PwC
More innovation in fundraising
Slide 9

10. PwC
Our top tips for a sustainable recovery
Slide 10PwC
Information
Strategy and
fundraising
Saying “no”
OptionsScenarios
CashReserves
Governance
People
1 2 3
4 5 6
7 8 9

11. PwC
Contact
Ian Oakley Smith
T: 020 7212 6023
E: ian.oakley-smith@uk.pwc.com
Slide 11PwC

12. Managing in the New Normal
Paul Streets
CEO, Lloyds Bank Foundation
12

13. 13
Our new strategy

14. 14
Our new focus

15. 15
ENHANCE
A grants plus model - offering an optional range of support to strengthen
the effectiveness of those we fund
What’s available? - 3 programmes

16. 16
The Challenge

17. 17
Source: ACF Giving Trends Top 300
Foundations 2014 Report
Giving Trends

18. 18
Source: ACF Giving
Trends Top 300
Foundations 2014
Report
Giving Trends

19. 19
FOUNDATION
LOCAL AUTHORITY
NATIONAL LOCAL COMMUNITY
The Issue

20. • Quality wins over quantity. Take the time to get fewer applications right,
rather than sending many in the hope that one may get noticed.
• Know your grant-maker. Also known as ‘do your homework’. If you know what
the grant maker is looking for, you’re more likely to get their attention.
• People and ideas win grants. Ultimately, the strength of your application
comes from the strength of the idea and the people behind it.
• Honesty beyond necessity. Don’t be afraid to consider and talk about what
could go wrong and is going wrong.
• Make sure grants are only part of your income mix. Also known as ‘don’t put all your
eggs in basket’. Relying too heavily on any one source of funding is an easy and common
mistake to make.
20
Our advice to charities is:
Source: Inside the Mind of a Grant Maker, nfp synergy

21. 21

22. Consultation on a Proposed
Sustainability Fund
ThomasLeftwich – SeniorPolicyAdvisor,SectorSustainabilityProgrammes
CFG Evolve Event – 16 June 2014

23. Office for Civil Society
The Office for Civil Society (OCS), sits within the Government Innovation Group and is part of the
Cabinet Office.
Set up in May 2010 to support the voluntary and community sector and to deliver key government
programmes, working across Government.
• Approx 75 staff
• Reports to Nick Hurd MP, Minister for Civil Society
OCS key objectives:
• Make it easier to run a voluntary or community sector organisation
• Get more resources into the sector to underpin its resilience and independence
• Make it easier to do business with the state
23

24. The Narrative for the Fund
Analysis of engagement with stakeholders and learning from past and current programmes has resulted in the development of an
emerging narrative. This narrative broadly follows the following three stages:
The following slides explore each of these three stages of the narrative in more depth.
.
24
A changing
environment
•The environment in which organisations are operating is changing. Changes to our society, the economy and
Government policy, have created both opportunities and pressures for the VCSE sector
Where do we
want to be?
•It is in all our interests for the VCSE sector to include a diverse range of organisations, delivering high quality services
for those most in-need in our society.
•To achieve this organisations need to be robust and resilient, able to understand the best route to sustainability and
have the resources and capability to follow it.
Overcoming
the barriers
•Organisations need to understand how they need to change, be able to plan effectively for the future and deliver
necessary change.
•However, many small to medium sized (SME) organisations struggle to do this whilst also reacting to the immediate
challenges they face. This fund can work to provide these organisations with the support they need in order to realise
the vision.

25. • Support to deal with funding cuts through
the Transition Fund
• Growing the Social Investment market:
• Establishing Big Society Capital
• The Investment and Contract
Readiness fund
• The planned market development
foundation
• Reforming support for the sector
through Transforming Local Infrastructure
• Opening up public services to the sector:
• Working with commissioners
• Introducing the Social Value Act
• Supporting innovation in, and scaling up,
social action:
• The Innovation in Giving Fund
• The Social Action Fund
• The Centre for Social Action
• Making it easier to run a VCSE
organisation by cutting red tape
The environment in which the sector is operating is
changing
25
• Need for new skills and capability
• Increasing demand for services
• Capacity limitations resulting from increased demand
• Funding cuts and changes
• Opportunities to deliver public services
• Greater competition for existing grants and contracts
• Increasing overhead costs
• Growing expectation to demonstrate evidence of impact
From Government:
• Continued spending restraint
• Welfare reforms
• Local authorities switching grants to
contracts
• Focus on growth
• Reforms to commissioning
Wider Society
• Effects of budget cuts and welfare reforms
• Aging population
• A more diverse population
• Increasing use of digital
A changing
environment
Evolving
pressures and
opportunities
for the sector
A changing
operating
environment
A range of
support and
strategies

26. 4. What does the
sector need to take
the right pathway?
2. What is
needed to
achieve this?
1. Where do
we need to
be?
3. What are the
pathways for
the sector?
Our vision is that the fund will help tosecure adiverse range of
organisations delivering high quality support for those in-need
26
A diverse range of organisations delivering
positive outcomes for some of the most
vulnerable and disadvantaged in society
Maintain core services by
restructuring and reducing
costs
Generate income through
trading/establishing paid
for services
Deliver public services
Robust adaptable business
models and clear forward
plans
Access to appropriate
sources of external support
and expertise
An appropriate skills base
in both executive staff and
trustees
Access to appropriate
funding to resource
change

27. The journey to sustainability for struggling organisations
requires aseries of stages. However, this can be difficult for
medium sized organisations lacking resource
27
i. Awareness: An
organisation needs to
be aware that its
operating environment
is changing
ii. Understanding: An
organisation needs to
understand what this change
means for them, and that
they need to change too
iii. Planning: An
organisation needs
to plan to deliver
change
iv. Delivery: An
organisation needs
to deliver
necessary change
v. Learning: An
organisation needs
to understand the
impact of delivery
and share learning
Expertise to carry out
needs analysis and
forward planning
Funding to free up capacity
to deliver change or deliver
necessary action
Therefore a potential aim for the fund could be : To identify voluntary sector organisations delivering vital services
to vulnerable people in our communities, but struggling to adapt to their changing environment, and put them on the
right pathway to securing the long term future of their services.
Funding to free up
capacity to engage
in planning
Expertise to enable
delivery of specific
actions
This fund could support small
to medium sized organisations
on this journey by providing:

28. • The Consultation launched recently and will run for 12 weeks until the 24 July.
• The intention is for this to be a co-design consultation around the key themes and challenges
identified. This will not involve simply proposing a complete fund design and inviting feedback. The
responses received will be used to formulate a fund design.
• The consultation will invite active engagement. Advice received has highlighted the need to
combine both online and face to face.
The Consultation can be accessed at:
www.gov.uk/government/consultations/new-fund-to-help-vcse-organisations-become-more-
sustainable
Queries and comments on the consulation can be sent to:
OCSsustainabilityfund@cabinet-office.gsi.gov.uk
AnActive and Open Consultation
28

29. Timetable
• Gain approval for consultation
document
April
• Launch consultationLate April
• Active consultationJune – July
• Analysis of responses and establishing
fund design
July
• Gain full business case approvals
• Commence sector awareness raising
Late summer
• Identify delivery partner/s and finalise
application design
Autumn
• Fund launched for applicationsDec
29
The following is a high level
forward timetable for the fund
development. This timetable is
indicative at this stage and
depends on the nature of final
fund design established through
consultation.
PlanConsultDesignDeliver

30. Excellent fundraising for a better world
Managing in the new
normal – fundraising
Daniel Fluskey, Head of Policy and Research

31. Excellent fundraising for a better world
A familiar scenario?
Charity
wants to do
more and
increase
services
Can only increase
service if have
resource to fund it
Resource
needs to
be
sustainable
Investment
and growth
for
fundraising
Growing
need /
demand for
service

32. Excellent fundraising for a better world
Putting it into context
• Latest information available: 2011/12
- Voluntary sector saw a net real-terms fall in its total income of
£700m
- Income from government fell by £1.3bn (with more to come)
- Income from individuals is the biggest source of income for the
sector, rising by over £500m from 2010/11 and 2011/12
- Value of reserves fell by almost £2bn

33. Excellent fundraising for a better world
Future fundraising environment

34. Excellent fundraising for a better world
Fundraising challenges

35. Excellent fundraising for a better world
How are charities responding?

36. Excellent fundraising for a better world
The new normal for fundraising
• There will be more fundraising!
• Developing new fundraising activity and getting good return on
investment will be challenging (it always was and always will be)
• Everything will change, and everything will stay the same
• Skills, experience, and expertise in fundraising will be in demand
• Investment for fundraising needs a clear and planned ‘whole
organisation’ approach – the numbers DON’T tell the full story
• External challenges (transparency, scrutiny) and ethical questions will
need to be addressed by all organisations

37. Excellent fundraising for a better world
More information
• Introductory videos http://www.institute-of-
fundraising.org.uk/guidance/five-minute-fundraiser/
• Code of Practice http://www.institute-of-
fundraising.org.uk/guidance/code-of-fundraising-practice/
Contact me: danielf@institute-of-fundraising.org.uk

38. Evolve 2014