Doing a deep dive on the state of the voluntary sector working in criminal justice will inevitably produce consistent, year-on-year themes. And this year’s State of the Sector was no different. One of these consistent themes, unsurprisingly, is funding - the how, the how much, the how often and the where.

We heard from voluntary sector organisations, across our survey and our range of area and thematic focus groups, that the sector’s funding, and lack thereof, continues to loom large as a critical barrier to continued success and impact. So, what exactly were we told?

Funding within the political context:

The funding context cannot be separated from the political context. Policy is inextricably linked with the amount of money that voluntary organisations can source. For example, we heard, from many different organisations, that the Government’s National Insurance rise has led to substantial difficulties for organisations in covering the resulting costs. The same was said for increases in the minimum and real living wages (though to note, these weren’t arguments against increasing wages).

Battling for a smaller piece of the pie:

Participants told us that it is becoming increasingly difficult to secure funding from charitable trusts and foundations. In 2023, our survey found that 42% of respondents reported securing more than half or all of the grants they applied for. This figure dropped to 26% this year. Many focus group participants explained that they were facing increased competition for funding. Funders noted that for smaller organisations, particularly outside of London or other big cities, the struggle is for visibility and access.

Full cost recovery…?

Only a quarter of our survey respondents reported achieving full cost recovery on all the services they delivered under contract or sub-contract in the financial year 2024/25. The subsequent impact has been significant with one survey respondent noting that ‘there are two options – reduce headcount of service users or reduce quality of services provided.’ Over half said their contract extensions did not come with an adequate financial uplift to meet inflationary costs. 

Short-termism and focus on innovation:

An age-old gripe of the sector is that it delivers ‘what works’ and that this needs to be reflected in funding cycles, something that was raised, again, this year. Short-term funding periods make it difficult to plan and deliver consistent services and creates additional, onerous work when having to apply for more funding. One focus group participant told us ‘there’s that constant kind of chasing your tail for what’s the next funding pot and what’s the next funding source, and where does that come from?’ Concerns were also raised about the focus of funders on ‘innovation’, rather than on funding ongoing work proven to be effective.

Looking ahead:

The impact of the Sentencing Act, with more people needing support in the community, will require the sector to do even more. To do that, it needs the resources to continue delivering effective, person-centred work, long proven to achieve outsized impact. That is why this year’s State of the Sector report makes a number of recommendations, leaning on the expertise of the sector to put forward what they need to change. What follows is a taster. For the full list of recommendations, you will have to read the final report upon publication at the end of March!

Recommendations (a taster):

What the sector needs from funders, both statutory and charitable:

1. Increase the availability of multi-year, unrestricted grant funding
2. Increase the availability of co-commissioned funding pots
3. Embed indexation into all future government contracts
4. Embed full-cost recovery into commissioned contracts