The Third Sector in the North East Mayoral Strategic Authority area

It is a methodological note that there were far more survey responses for the North East MSA area than in the Tees Valley Combined Authority. For this reason, we have compared the North East MSA data primarily to the statistical findings for England and Wales as a whole, not for the North East, as this would risk reading too much into the data from the other part of the North East (TVCA), where the number of responses is not statistically significant enough for this to be a robust comparison. 

Partnership working is strong between charitable organisations in the area: 

For all of these indicators, organisations in the North East MSA area are substantially more likely to report they are working in partnership than for England and Wales as a whole, where informal relationships are reported by 72% of organisations, close working reported by 62% and formal partnership arrangements by just 28% of respondents. 

The survey asks respondents their perspectives of their relationship with the local public sector, and the responses paint a very mixed picture: 

Charitable organisations in the North East Mayoral Strategic Authority region are already bidding for and delivering contracts - overall this accounts for 10.1% of all charities and community groups in the region compared for just 7.5% for England and Wales. 

Although we know this may be affected by the trend of there being a higher proportion of larger organisations in this region, this does appear to be true across income brackets as well: whilst when we drill data down to this level the smaller sample sizes do reduce confidence in the data to a degree, analysis does show that, across all income brackets above £50,000, the North East MSA area is in line with or above England and Wales average for bidding and delivering contracts.

Certainly then, the charity and community sector in the North East is not lagging behind the rest of the country in being "tender-ready"; there is already a well-developed sector here of organisations involved in, or interested in, the opportunity to deliver services under contract from local authorities and other public bodies if the conditions are right.

However, there is still appetite among some organisations for more information and more support; a further 17.4% of organisations responding to this question in the North East MSA area responded "we are interested in this option but feel there are barriers in the tendering process" or "we are interested in this option but would need extra support to do this". There remains a business case then to invest in this type of support for organisations, but also a further highlight that the procurement processes as they work at the moment are posing barriers and challenges for many organisations.

This survey hasn't engaged with the theme of social finance and social investment as something distinct from paid-for contracts, but as a region we are already well placed to secure and deliver funded programmes under contract.

In the North East MSA area, perceptions of devolution are mixed, like the rest of the country:  

There appears to be a loose pattern across the country that in city regions where devolution is more well-established, there is a more positive view of devolution and its impact as a piece of policy; for more newly established authorities, responses are weaker, and it is likely that this is reflected in the North East MSA data, as the new authority has focused on establishing structures and working through plans.

The findings do however reflect that organisations feel they have been asked a lot to improve engagement with communities, and it will be critical for policy-makers at regional level that there is a caution in this to not lose capital and goodwill with the charitable sector, and to move quickly towards meaningful action. 

There is a definite "activist" streak to the charitable sector in the North East MSA area; organisations report a much higher rate of engagement in influencing activity, and less reticence to engage with political issues than the national data for England and Wales. There is also a good deal of trust in sector infrastructure to lobby and influence on behalf of the sector, reflecting the strength of this support network in the region, and how it is valued by the sector. 

Charitable organisations in the North East MSA area are much more likely to report that support from business is important for them across all forms of support than in the figures for England and Wales. This is a really positive reflection of the strong connections between business and the charitable sector in the region, one of its great strengths; the provision of free expert advice is particularly strong in the region, a testament to the value of work undertaken by bodies including Community Foundation North East to broker and facilitate these relationships. 

Across the North East MSA region, organisations are substantially more likely to consider funding from public sector contracts important or very important within their funding mix, when compared to figures for England and Wales.

Organisations are also heavily reliant on grants. It's been noted elsewhere that in the North East there is an overall pattern of fewer, larger charities focused on alleviating social need and fewer self-contained micro community groups which self-fund through subscription models. This graph is another reflection of this reality, and grant-funding remains the absolute bedrock for this kind of critical work. 

Organisations in the North East MSA area recount broadly positive experiences of engagement with grant-makers compared to England and Wales as a whole. 61% agreed or strongly agreed that grant-makers gave them unrestricted funding compared with 56% nationally and half reported funders making a long-term investment in their work compared to 40% nationally.  

This is a very positive reflection on the ethical and progressive approach to grant-making many funders based in the region have been developing in recent years. 

In the last two years the number of Full Time and Part Time employees has increased in around a third of organisations, whilst fewer than a fifth report their staff numbers falling, suggesting the sector is remaining steady or growing in terms of workforce.

However organisations are far more likely to report that they find recruitment and retention harder than that they find it easier than two years ago:

Like the rest of the North East, in the North East MSA area, recruitment and retention seems to pose a greater problem for charitable organisations than it does for England and Wales. However, the sector has also seen a greater increase in full and part time staffing than nationally, which may reflect the reason for some of this challenge, alongside wider economic and labour-force dynamics documented across the North East.

Commitments to improving pathways into work, especially for those who are economically inactive, could benefit local community organisations as well as larger employers and their needs should be considered in programmes around skills and employability. 

Difficulties in recruiting regular volunteers are in line with the national average, as is the struggle to return to pre-Covid levels of regular volunteering.  

Like the rest of the country, this could be an issue of concern for charitable sector leaders and policymakers in the region. There are potentially demographic issues at play, as well as wider-population level challenges around the economy, health and skills, that is likely to impact on the number of available volunteers, and this could substantially reduce the ability of the sector to have the impact it wants to have in improving life for people in local communities. Making assumptions about the ability and capacity of charitable organisations to deliver projects and programmes by relying on volunteers should be carefully considered, but there may be mileage to exploring how more and better infrastructure support specifically focused on volunteers might be able to unlock a "new generation".  

Organisations in the North East MSA region state they are finding it harder to recruit and retain trustees than two years ago but these figures are relatively aligned to the bigger picture nationally: 

This does however highlight the ongoing need for and value of work like the Trustee Match programme, provided by Community Foundation North East, to support connecting causes with trustees, and developing skills and confidence for people looking at trustee roles for the first time, in order to grow and maintain that pipeline. 

As with other places, we see a significant degree of optimism from sector leaders in the North East MSA region; they broadly expect in the coming years they will remain stable or grow in terms of their resources and impact; they also unanimously believe demand for their services will remain stable or increase: 

Whilst we are even more positive about partnership working than the wider findings for England and Wales, we are less positive about the future of statutory funding within the income mix than the national benchmark. There are a number of potential explanations for this not interrogated by our survey; it could be organisations expect funding into public services to continue to fall, with these cuts being passed to supply chains, it could relate to concerns around health funding in particular given changes to ICB structures, or it could be that the perception is markets are shifting in such a way that Extra Large (over £25m) charities or non-charitable contract management companies will take a bigger share of public sector contracts going forward, to the detriment of the sector. 

Any genuine commitment will, in line with the Civil Society Covenant, to make sure charitable organisations can play a key part in delivering for communities, with resources from government bodies to support this, will need to allay these concerns and seriously consider what reforms to procurement processes are needed. 

In terms of who the sector is working with, we have a big, wide-ranging spread of impact reaching beneficiaries from all backgrounds: 

Moreover, organisations in our region are more likely to report that they have a “very strong impact” across a range of social themes compared to national figures, highlighting the way in which the sector is orientated and focused very much on tackling the biggest needs and issues in communities: