Third Sector Budget Detail

Third Sector Budget Detail


We are continuing to support the third sector and encourage the social enterprise model, ensuring its important role in developing programmes of preventative spend in order to improve employability prospects, support better care for the elderly and provide opportunities for young people. The funding for the third sector continues to support equity by strengthening the capacity of the sector to respond at a local level, complementing the work funded by the Health, Wellbeing and Cities Strategy portfolio.


The third sector has an important part to play in reforming public services at the local level. We will continue to support the increasing engagement of the third sector in Community Planning Partnerships (CPPs) so that its skills, knowledge and expertise provide the fullest possible support to the delivery of the Single Outcome Agreement benefiting local communities, especially the most vulnerable in each local authority area.


We take the lead responsibility for ensuring that our public services are high quality, continually improving, efficient and responsive to local people’s needs by supporting the delivery of better quality, user-focused services and smaller, simpler, better aligned and more efficient government.


Through our portfolio spend; we will contribute to reducing inequalities by developing more responsive services through community engagement, widening access and opportunity and addressing discrimination where it persists. The balanced economic growth we seek draws upon the potential of all in Scotland, and our investment in the improvement of public services and the third sector will provide us with opportunities to explore best practice moving forward.


In the third sector we have focused on actions set out in the Enterprising Third Sector Action Plan and have delivered a programme of business support that has led to greater collaborative working and third sector success in tendering and winning contracts. Examples of these are £28.8 million of investment awarded to over 50 organisations from the Scottish Investment Fund and £10.9 million Third Sector Enterprise Fund grant provided to 186 organisations to secure a transformational change in their financial sustainability. 147 individuals have also been assisted in establishing their social enterprise through the Social Entrepreneurs Fund.


We are also investing in developing the third sector in order that it can play a full role in reforming our public services; through greater involvement in service design and delivery with an emphasis on developing programmes with a focus on preventative spend. The third sector has a key role to play in delivering the Christie Commission’s recommendations on place, collaborative spend in localities and preventative spend. We will be working across Government and the public sector to ensure that the third sector’s role can be maximised, supporting greater collaboration between the public and the third sectors both at the local and national levels.


Taking these challenges and possible contributing approaches into account, we have considered the scope for efficiencies and the contribution that spending programmes make to sustainable economic growth and the delivery of portfolio priorities in all areas of expenditure within the FESG portfolio. This is reflected in our allocation of resources across the portfolio. 


What the budget does


The Third Sector budget helps to grow and strengthen the sector. From 2012-13 Scottish Investment Fund will be incorporated within the Third Sector budget. This will enhance the sector’s ability to play a full role in the Scottish economy and in the reform of public services. It will better position the third sector to ensure that individual users, social enterprises and communities are at the centre of service design so that opportunities are maximised in the development of preventative programmes.


Third Sector activity centres on support for the development of a thriving third sector that is a key social partner in decisions around the design and delivery of public services. This will be achieved by focusing on building the capacity and credibility of third sector input to public policy, ensuring that it can respond positively to a stronger and growing role in public life. More specifically to increase its potential economic contribution we will encourage the social enterprise model, whilst ensuring its important role in developing programmes of preventative spend are realised enhancing its potential for improving employability prospects, better care for the elderly and providing opportunities for young people.


The Reducing Re-offending Change Fund is a fund that will support innovation and increase the impact and coverage of interventions that help to reduce reoffending and supports work within the Justice portfolio.


In 2012-13 we will:


• provide strategic support to encourage effective engagement between third sector and Community Planning Partnerships;
• provide business development support that delivers third sector growth, skills development and opening public sector markets;
• direct investment in enterprising third sector organisations and the development of new finance models; and
• work across the Scottish Government to identify and exploit opportunities for third sector engagement and to increase the role of the third sector in the transformation of public service delivery.


A decisive shift to preventative spending


The Scottish Government’s spending plans are also designed to deliver a step change in the way in which we fund and deliver public services.


There is a growing body of evidence which demonstrates that spending on prevention can deliver better solutions and outcomes for individuals and avert future costs on the public sector. This starts with a focus on the first few years of life, where we know that a good start will bear dividends for a lifetime. Since 2007, the Scottish Government has taken work forward with our local authority partners and others to support this approach, including through the Early Years framework. But we are not limiting our efforts to early years: we are driving forward a range of policies – from shifting the balance of care to enable older people to remain at home, to our work to reduce offending and reoffending.


Now we need to take this work to the next stage. We have therefore identified significant funding to support a transition across public services away from dealing with the symptoms of disadvantage and inequality towards tackling their root causes. This will help deliver outcomes at reduced cost over the period of the Spending Review and this parliamentary term as a whole. The third sector has a crucial role to play in delivery, because of its specialist expertise, its ability to engage with vulnerable groups and its flexible and innovative approach.


As part of this approach, we are introducing three new funds to support preventative spending:


• a continuation of the Change Fund for older people’s services. The fund currently amounts to £70 million within the NHS budget for 2011-12. This will increase to £80m/£80m/£70m within NHS budgets, supplemented by funding from local authority partners.
• an Early Years and Early Intervention Change Fund, to be overseen by the Early Years Taskforce, aimed at using evidence-based interventions to give our children the best start in life. The resourcing of this fund will be provided by NHS Boards and local authorities, working together to agree their local contributions and achieve maximum impact and value for money. As a central contribution to this, the Scottish Government will provide £50 million of resource over the parliamentary term through the Sure Start Fund component of the Scottish Futures Fund.
• a Reducing Reoffending Change Fund, focusing on preventative spend, will be created to bolster those interventions that we know can reduce reoffending. This work will take account of the particular contribution that can be made by third sector service providers. The fund will expand the coverage and impact of those interventions with a proven track record in reducing reoffending, as well as supporting innovation. This will help shift the focus of services, to get the correct balance between proactive and reactive services, as part of the next phase of the Government’s Reducing Reoffending programme.


Taken together, these funds provide over £500 million of investment in preventative spending over the Spending Review period, bringing together new and existing expenditure. This continuing investment in preventative spend is directly aimed at improving outcomes and reducing the demand for a range of acute services over time. These funds will help drive the further integration of services and the sharing of vital resources. Corresponding budgets can therefore be reduced in future years, enabling us to manage costs across the Spending Review period as a whole.