Just half of the largest voluntary organisations deliver public service contracts, as rising costs make doing so increasingly unaffordable, a new report has found.
Third Sector Trends, a study of the UK’s voluntary sector, found that the number of voluntary organisations of all sizes bidding for or delivering public services under contract “continues to decline steeply”.
The research was conducted by professor Tony Chapman of St Chad’s College at Durham University. It was carried out via online surveys sent by direct email invitations from listings collated from the Charity Commission register between June and September, with a total of 8,680 responses recorded.
Among the biggest voluntary organisations – those with an annual income of £5m to £25m – 64 per cent remained involved with delivering public service contracts between 2016 and 2019.
But this commitment collapsed during the Covid-19 pandemic to 54 per cent, the report says, declining further to 50 per cent in 2025.
The report’s author Tony Chapman, director of policy and practice at Durham University, wrote: “Governments of all persuasions have been keen to engage the voluntary sector in the delivery of public services under contract.
“Many voluntary organisations have lost interest in such work because the value of contracts is insufficient to meet the cost of doing the work.
“It will be argued in the conclusion that unless the government acts fast – reengaging voluntary organisations will be extremely difficult if their trust and capacity to do such work has been lost.”
The report also found that financial support from business remained below pre-pandemic levels.
In 2016, 39 per cent of voluntary organisations said they were receiving useful financial support from businesses.
As the pandemic waned in 2022, this figure had fallen to 20 per cent.
This year the numbers recovered to 33 per cent, but have still not returned to pre-pandemic levels.
The report also found that the number of formal partnerships among voluntary organisations had fallen from 34 per cent in 2022 to 28 per cent this year.
More than half of those surveyed (53 per cenet) said they were currently disinterested in formal partnership working, up from 47 per cent in 2022.
The project was funded by Community Foundation North East, Lloyds Bank Foundation England and Wales, Wales Council for Voluntary Action and Millfield House Foundation.