Consultation response: Third Sector Funding Principles
/CHEX responded to this Scottish Parliament pre-budget 2025-26 scrutiny call for views on third sector funding principles.
To inform our response we conducted an online survey with our network, using some of the questions from the consultation that we felt were particularly pertinent to the community organisations we work with. This survey was completed by 34 individuals from a range of community and third sector organisations.
Key points from our response
Community organisations say that longer-term funding of 3 years or more would provide them with financial stability and longer-term sustainability
This, in addition to flexible unrestricted core funding, would enable organisations to plan and align their work with their long term strategy, to innovate and adapt to change, to collaborate and build relationships, and to develop and build capacity.
Consideration needs to be given to what is meant by core funding means. Most community organisations recover core funding from adding on overhead costs and management fees to contracts and grants. So, although it’s core, it often ends up being tied to project or service delivery.
Inflation-based uplifts and full-cost recovery would also help provide stability, security and flexibility for community organisations.
Community organisations are supportive of paying staff a ‘living wage’ although they point out that many funders currently do not take account of this and that paying a living wage puts additional pressures on finances.
CHEX's own view is that, in order to resource these and other suggestions in this consultation effectively, thought needs to be given to how to increase the overall pot of funding for the third sector at a national level. Ultimately, this comes back to how we think about public services and the kind of society we want to live in.
Read a summary of our response (PDF)
Read our full response (PDF)
