(Title Image: Barnardo’s)
The Third Sector. You’ve probably heard something about it (sometimes negative, sometimes positive) and based on the headlines it generates, it plays an influential role in Welsh policy, lobbying and civic life.
I went into that in some more detail here. In summary, the Third Sector consists of private organisations which deliver a social or public benefit over profit. It includes registered charities, advocacy groups, think tanks, religious organisations and community enterprises.
The biggest organisations (the likes of Oxfam and Cancer Research UK) will have annual turnovers in the hundreds of millions of pounds, while the smallest ones may only raise a few hundred to a few thousand pounds a year.
In terms of what it does, services include advocacy (representing and offering advice to marginalised groups), political lobbying (to get changes to the law or public policy to benefit those groups), providing community services (homeless shelters, pubs, sports teams) and carrying out scientific or quantitative research to benefit society or specific groups.
This post is a bit different from the previous one as it attempts to focus on a few key questions that weren’t answered in enough detail last time.
How many Third Sector organisations are there in Wales?
This has been a difficult figure to pin down, but a bit more clarity came with the establishment of a Third Sector data hub at the start of 2018.
The Welsh Council for Voluntary Action (WCVA) – the umbrella organisation representing the voluntary sector in Wales – says there were 31,312 Third Sector organisations with an address in Wales and 32,294 operating in Wales in July 2017.
That means there’s one Third Sector organisation operating in Wales for every 96 people.
About half of them are sporting, community and religious groups – some likely to be very small and probably don’t count as making a “sizable impact” on public life.
What does this tell us? – Even ignoring the smaller organisations (and those that have to exist separately from each other, like sports clubs), there’s likely to be a massive duplication in function and number. Each organisation will need a chief executive/chair, treasurer etc. and it’s unlikely that all of these organisations are being run as well as they should be, which is probably making some parts of the Third Sector unsustainable.
What does the Third Sector actually do?
In terms of method, there were four main choices when it came to answering this question – the Charity Commission register (which is awkward to use), the Welsh Council for Voluntary Action’s (WCVA) own online directory of National Voluntary Organisations, Infoengine (which is similar but has a smaller number of categories) or the aforementioned data hub.
I decided that as it contained a more diverse range of categories, and it lists many of the organisations that observers of Welsh politics will be familiar with (i.e. Gofal, Hafal, BAWSO) the WCVA listing was the best option.
There were 640 separate organisations listed on the WCVA database – which has recently been taken down (the top link, lucky I did this when I did), with 2827 different category entries, meaning an average of 4.4 categories for each Third Sector body.
Some of the listings were a bit “odd”. For example, Chwarae Teg – an organisation known for working with adult women – was listed as working with children. The anti-abortion Society for the Protection of Unborn Children has a listing on the WCVA site, while Breast Cancer Care is listed as working with men (this may refer to partners of patients, admittedly, but breast cancer in men is incredibly rare, to put it mildly).
What does this tell us? – Undertaking work in multiple categories at the same time points to, again, massive overlapping in functions, an inefficient spread of work, professionalism (not altruism) and even competition between different organisations for funding and resources. The bigger organisations will be run like businesses and it makes you question just how much money goes to frontline services as opposed to administrative/executive tasks and lobbying.
What’s the Third Sector worth to Wales?
According to the data hub, the Third Sector employed 116,600 people in Wales in 2015 – said to be around 10% of the workforce, working from 6,700 establishments (8.3% of all employment places). The vast majority of both employees and premises are in health & social care, the arts/culture as well as retail (presumably charity shops).
28% of people volunteered in Wales during 2016-17, with volunteering rates broadly higher in rural areas over urban areas. Older age groups were also, proportionally, more likely to volunteer than younger age groups. The value of the volunteering time (at average hourly wages of £12.50) is put at £757million.
Total income for the Third Sector in Wales during 2014-15 was £1.09billion. £537.2million of that (49.2%) came from government – in other words, taxpayers. £289.4million (pdf p25)came from the Welsh Government in 2015-16 (£248m grants, £41.4m contracts) compared to £350million in 2010-11.
What does this tell us? – The Third Sector in Wales is overly reliant on public grants to sustain itself. Considering the problems I’ve mentioned earlier with so many organisations competing on the same turf, that’s not a surprise as many organisations will need grants and public contracts to justify their existence and maintain services. There’s no evidence that this spending is corrupt (with a few notable exceptions), but in an environment where political connections and lobbying are important, the sector should expect scepticism.
The social value of these organisations is perhaps more important than the business and economic aspects – the high volunteering rates amongst older people hint at the Third Sector playing a big role in reducing social isolation, while volunteering is a source of unpaid reserve labour.