Over Christmas, Cabinet Office Minister Matthew Hancock called for the FOI Act to be extended to include charities in receipt of government funding. NCVO responded to say that we are wholeheartedly in favour of transparency, but believe there are better, more cost effective ways to achieve it than extending the FOI Act directly to charities.
While the FOI proposal has been mooted and rejected before, we understand the minister’s desire to consider it afresh, given the changing – increasingly outsourced – nature of public services. It is a conversation we are happy to have. In this blog post, I will attempt to set out our thinking in slightly more detail.
Charities should be open and transparent
NCVO has long championed the need for charities to be open and transparent – about their impact, governance, fundraising, campaigning, pay, investments and so on. We are clear that charities exist to serve the public and should be able to demonstrate this not just in their ends, but also in their means.
We have played a leading role in advising charities on how best to open up their data and have helped set standards of best practice. We also produce the most comprehensive financial dataset for the charity sector annually. This work not only informs government policy, for example by contributing to GDP estimates, but promotes public understanding of the voluntary sector as a whole.
The FOI Act is a very good thing
We also value the FOI Act highly. Many charities have used this tool to hold government to account and to help people understand how decisions have been made that affect their lives. We applaud successive governments for releasing information via this mechanism, but particularly welcome the current government’s efforts to go further – releasing more information and make more data open by default. Not only is this the principled thing to do, it is also likely to be more cost-efficient by reducing FOI requests.
On this point, we would be deeply concerned if the FOI Act were to be curtailed in any way, as some fear it will be. The Freedom of Information Commission, established last summer, has apparently received 30,000 submissions – a testament to the strength of feeling about the Act, but also provoked no doubt by concerns about the Commission’s membership and priorities. We also noted last week the closure of the open policymaking unit within Whitehall and hope that this is not a harbinger of less open government to come.
How to increase accountability for public service providers
In an era of increased outsourcing, it is right to review accountability arrangements. It is important that the public can hold the government and public service providers – whatever their stripes – to account for their performance. The question is how best to do this.
The principle that the public should be able to ‘follow the money’ is sound. But our concern about extending FOI requirements to charities themselves is that the increased administrative burden and costs will further deter the involvement of specialist charities in crucial public services.
Along with other SMEs, charities already face considerable barriers to providing public services – not least, very large contracts and very squeezed costs. Even some larger companies are now finding it hard to make the maths add up. Few charities could afford to employ expert FOI staff on top and, in any event, we rather suspect the public would prefer they spend any spare money at the frontline.
There is a better way. Public bodies should properly identify the information and data they need to monitor the performance of service providers and specify this within their grant or contract. This information, being duly provided, should then either be released proactively (we support the Institute for Government proposals about how to do this) or subject to FOI in the usual way, via the public body. This approach should ensure proportionality – charities and other SMEs with relatively small amounts of funding should not be subject to onerous reporting requirements, whereas the overwhelming majority of government grants and contracts with (typically much larger) companies would be opened to greater scrutiny. It would certainly enable greater public access to information than is currently the case.
This isn’t the first time such a proposal has been mooted, but it could be argued that in the current environment it is given more credence because of the reluctance of some – though certainly not all – charities to be more open and transparent about how they work, how they make a difference, and what results they achieve.
Independent of any argument over FOI, it feels more important than ever that charities up their game on transparency and accountability so that regulatory measures like this are clearly unnecessary. We’ve said before that transparency is a value, and many charities are already doing good work in this area. Over the coming year we’ll write more about how we might put this particular value into practice.