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The Value of Small

Sheffield Hallam University’s Centre for Regional Economic and Social Research teamed up with Lloyds Bank Foundation to produce a distinctive study of the contribution made by small and medium-sized charities in England and Wales. These charities are defined as having an annual income of between £10,000 and £1 million and constitute 52% (64,000) of all registered charities.

The research throws up some compelling reasons why small-scale charities manage to achieve an unexpected effectiveness, largely through offering a personal, responsive, long-term, trustworthy and rapid-decision service. The distinctiveness of small and medium sized charities derives from a set of features that the research identified, particularly the plugging of gaps in the public services. Small/medium scale charities tend to be “first responders to newly emerging needs at a hyper-local level”; they achieve diversity through recruiting volunteers from the local community; and they often work in a micro fashion, at the level of individual needs. Importantly, small/medium sized charities can offer ‘more bang for the buck’, providing many more volunteers per £1 of funding than larger charities. They tend to be more embedded in local organisations and social networks, enabling “people to navigate services and know which providers within the wider ecosystem are able meet or respond to their needs.”

That’s the good news; the bad is that small and medium sized charities are at a distinct disadvantage when it comes to winning public sector tenders. The research findings “suggest there is a mismatch between the distinctive offer, approach and position of SMCs [small/medium sized charities]; the approach local public sector bodies take to commissioning services; and the way that the value of those services − the outcomes and wider benefits they lead to − is measured and understood.” The research calls for public sector bodies to give “more consideration to how SMCs can be involved in procurement and commissioning processes.

This means that tender specifications should take account of the distinctive offer, approach and position of SMCs for meeting the needs of different service user populations.” Joanne Cholerton, CEO of 3SC, added: “3SC welcomes this piece of research which clearly supports our views on the unique benefits of small and medium sized charities. 3SC will continue to push for change in the public procurement system as set out in its position paper, so that more of these small and medium size Third Sector organisations can be involved in delivering public services.”