The Transition Fund is a central government initiative, aimed at helping civil society organisations and social enterprises stay afloat during the public spending cuts. It is supposed to offer these groups an opportunity to review the way they have been working, and to change to suit the new economic environment. The scheme is being run by the Big Fund (formerly Big Lottery), on behalf of the Office for Civil Society.
Criteria
To be eligible to apply, groups must:
- …be civil society organisations (that is, a registered charity, community benefit society, community interest company, or social enterprise) with an income of between £50,000 and £10m.
- …derive at least 60% of their income from taxpayer-funded sources – that is, grants or contracts from local government, central government, local health authorities or Regional Development Agencies.
- …spend at least 50% of their taxpayer-funded income on one or more of the following areas: health and social care; homelessness; education and training; offender rehabilitation; welfare to work/employment services; children and families; debt counselling and legal advice.
- …have free reserves of not more than six months.
- …face significant cuts – at least 30% of their taxpayer-funded income in 2011/12, as compared to their most recent set of signed annual accounts.
- …deliver the majority of their services in England.
The smallest available grant is £12,500, the largest £500,000, and any grant can meet no more than half of the group’s taxpayer-funded income. As such, your group must stand to lose at least £25,000 as a result of public spending cuts to be eligible. You are allowed to take cuts that have occurred this year into account – but if the cuts occur over a period of several years, then you may be ineligible – you must have lost 30% of your taxpayer funded income by 2011.
In addition, it is expected that the majority of the grant must be spent on “change activities”. According to the Big Fund, change activities are defined as:
- …developing and redesigning existing and new serves in the public services areas.
- …restructuring or moving to a different business model, including redundancy costs where necessary.
- …the costs associated with moving services to or from other organisations.
- …the costs of developing new partnerships, alliances, mergers and/or shared services.
- …staff training.
- …getting expert advice and support.
However, it is acceptable to use a small amount of the grant to continue delivering services, for example to cover salaries of core staff, or to bridge the period between the end of one business model and the start of another. If this is the case, it needs to be explained in the original application. Ultimately though, if your group applies, it needs to have some idea of what it will change into.
The Transition Fund website makes it clear that grants cannot pay for:
- …costs that have already been incurred.
- …items that only benefit an individual.
- ….items that are not directly needed to deliver the proposed work.
- …travel outside the UK.
- …funds to build up a reserve or surplus, whether distributable or not.
- …loan repayments.
- …contributions to general appeals.
It is worth emphasising that groups are not precluded from applying if they are already in receipt of Big Lottery funding.
Applying
It may be that the “transition” your group has planned is to merge or consort with one or more other groups. This is completely fine, but it should be noted that only one group can apply for the consortium, so choose the named group wisely.
If your organisation meets these criteria, then indicate so here (under the ‘Apply’ tab), and you will be allowed to download an application form.
This will need to include as much evidence (e.g. letters confirming a cut in funding, confirmation that a contract will not be renewed, warnings of a funding review or cuts, etc.) as you can provide of the taxpayer-funded income your group is likely to lose, and if that is not possible, an explanation of the same (a letter from a chief executive or equivalent will be required as part of this). Ideally though, your group will provide both.
Ultimately, if the application succeeds without concrete evidence, this may need to be provided before money is paid. This is to ensure that only groups subject to funding cuts receive the money, as oppose to groups which lose money due to underperformance.
The closing date for any applications is January 21st, 2011.
Useful links
