Sustainable Funding

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Sustainable Funding

• Pauline OHare
• Community Development Manager
• NEIGHBOURHOOD DEVELOPMENT RESEARCH PROJECT

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Objectives

• By the end of the two hours that participants
  have
• gained an understanding on how fundamental
  planning is to sustainable funding.
• gained a stronger awareness of different funding
  sources.
• been informed about options for exit strategies
• - generated some ideas to take back to your
  organisations.

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What is Sustainable Funding?

• Sustainable Funding is an approach, which begins
  with planning and explores all the potential ways
  to fund an organisations services and activities
  to ensure the ongoing viability of the
  organisation.

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Sustainable FundingFour Key Themes

• Theme One
• Effective Planning

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Cycle of Planning
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Sustainable FundingFour Key Themes

• Theme Two Income Diversification
• Theme Three Building Up Skills and Making
  Effective Use of Resources
• Theme Four Pursuing the Most Appropriate Income
  Opportunities

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Why Sustainable Funding?

• There may be a decline in the value and
  availability of Trust Funds.
• Acceptance of Full Cost Recovery
• A shift from funding voluntary activity to
  financing activities.
• Increase in the procurement commissioning of
  services.
• More long-term funding 3-5 years
• More opportunities for joined up/partnership
  working

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Partnership Working

• Informal networks/joint delivery/merger
• Charity Commission duty on Trustees to consider
  partnership working regularly
• Deciding Factor best interests of your service
  users.
• Should you collaborate?www.ncvo-vol.org.uk/joint
  projects
• Partnership Agreements get legal advice

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Succession Strategies

• There are five possible routes to succession
• 1. Mainstreaming
• 2. Further Funding / Finance
• 3. Enterprise
• 4. Closure
• Elements of 1, 2, 3 4

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Succession Strategies

• Projects readiness for succession will depend on
• A range of stakeholder opinions
• Evidence of project success

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• EXERCISE

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Spectrum of Funding
Spectrum of Funding
Donor
Funder
Purchaser
Customer
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Grant Funding

• Restricted
• Competitive
• May be Decreasing
• Two-Stage Process

14
Gift Economy

• Income from Donors
• Irregular
• Unrestricted Income
• Most Successful Organisations likely to attract
  an individuals personal interest.
• Gift Aid

15
Structured Market

• Earned Income from selling a service
• Can be obtained from delivering a service under
  contract/trading
• VCOs can deliver services under contract to
  public, private or voluntary organisations.
• Biggest Growth Area providing public services.
• Developing good working relationships with
  potential purchasers is essential

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Structured Market

• Commissioning
• the process of specifying, securing and
  monitoring services to meet peoples needs at a
  strategic level Audit Commission 2003
• Procurement
• open competition for the delivery of services
  where we (i.e. the voluntary sector) are likely
  to be in competition with the private sector, in
  tendering to deliver services

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Structured Market

• Local Authorities Tradition in Grant Funding.
• Commissioning most advanced in social services.
• In other areas-commissioning is more ad hoc
• In the future could be extended to youth
  services, supplementary schools and advice
  services.

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Structured Market

• Local Authority budget.
• No longer efficient for Local Authorities to have
  lots of small contracts.
• Consider the benefits of partnership or
  collaborative working.
• Keep abreast of what is happening locally eg
  Local Area Agreements

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Open Market

• Another major area of unrestricted income
• Earning income from customers.
• Ideally unite providing a product or service
  which furthers your mission/aims with generating
  income
• Can be small or large scale

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Loans

• Not an income source a financial enabler
• Help organisations to grow
• Investment can be the means to opening new income
  streams.
• Each VCO is unique so options open to them will
  be different
• Quasi-Equity eg Future Builders

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Loans Future Builders(Public Services)

• Lender, Grant Maker and Organisational Developer
• Bespoke investment packages terms designed to
  suit the business context
• Loans repaid through public sector contracts
• Grants for non-recoverable costs and capacity
  building
• Development grants to help promising shortlisted
  applicants

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Loans Adventure Capital Fund(Trading)

• To provide loans, funding and some gift capital
• To encourage organisations to use different types
  of finance, and to begin to move away from
  relying on grant support in the long term.
• To be flexible enough to respond to the needs of
  each organisation.
• To focus on the financial and social returns from
  our investment rather than on monitoring
  activities.
• To share risk.
• To work with organisations to develop impact
  evaluation, of value to both ACF and the
  organisation.

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• Any Questions?

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Contact Information

• Pauline OHare
• Community Development Manager
• 9 Hailey Road Business Park
• Erith
• Kent
• DA18 4AA
• Tel [phone]
• E-mail ndrp_at_btconnect.com
• Web-site www.ndrp.co.uk