Charity: what can we learn from history?

Government provides social care through the welfare state, but now politicians want charities involved. Will it work? Chris Bowlby finds out more from Dr Alex Mold

Glasgow 2005. Homeless man begs for change on streets on Glasgow

Today’s politicians are great believers in charity. It may not show in the way they behave towards each other but politicians of all parties are promising an ever greater role for charities in supplying public services. Charities are praised as the ‘third sector’, avoiding, so the argument goes, the uniformity and inefficiency of much public sector provision, while acting from nobler motives than private sector providers chasing profit.

But charity is a word with an ambiguous history. While the charitable impulse is very much admired, reliance on charity for social services has overtones of humiliation for those who remember life before the welfare state. Indeed some deliberately choose to call themselves “voluntary organisations” to avoid both the more precise legal definition and negative associations of the label ‘charity’.

Others fear that too close a relationship with government will undermine the robust independence that charities have enjoyed in the past as critics of state provision and providers of alternatives. I have been discussing these challenges with Dr Alex Mold, a specialist in the history of voluntary organisations at the London School of Hygiene and Tropical Medicine.

What kind of change are today’s parties talking about?
Alex Mold: Voluntary organisations have long played a part in delivering services, particularly in areas where public provision was regarded as inadequate or inappropriate, such as in personal and social care.

But what we are currently seeing is greater diversity in the kinds of areas where charities are at work and in the type of groups involved. For example, in September 2008 it was announced that charities, in connection with private organisations, were bidding to run new prisons. This kind of development also indicates Labour’s recent attempts to combine commercial business models with a voluntary sector ethos.

The emergence of hybrid groups like ‘social enterprises’ (organisations which have a social or environmental objective rather than profit as their main goal, such as The Big Issue, Jamie Oliver’s Fifteen, and The Eden Project) have also been praised by the Conservative Party, which wants to see an increased emphasis on the work of charities in welfare provision.

Indeed, the Conservatives argued in a recent Green Paper on voluntary action in the 21st century that the ‘third sector’ should actually be thought of as the ‘first sector’, in the sense that this should be the first place government looks for answers to difficult social problems.

How much of a shift would this mark from charities’ earlier role?
AM: If you take the long view of charities, you can find both continuity and change. Before the late 1940s, charities were central to welfare provision in a range of areas, such as hospital services. With the coming of the welfare state, many of these organisations disappeared, or were absorbed within state-run structures.

As a result, it was widely thought that charities would wither away during the 1950s in the face of the welfare state.

Commentators, especially those on the left, believed that publicly-provided services also removed much of the stigma associated with charitable provision, as individuals were treated as citizens, not as supplicants. However, by the late 1960s, confidence in the ability of the state to cater fully for every citizen’s needs was beginning to be undermined.

A series of scandals around issues such as homelessness, child poverty and drug use revealed that public provision was inadequate or nonexistent in many areas. As a result, new voluntary organisations came into being to campaign for, and often provide, improved services. Many now familiar charities, such as Shelter, the Child Poverty Action Group, and Release, which offers advice to people arrested for drug possession, were established in this period.

Significantly, the government quickly recognised the value of these agencies in offering services that statutory agencies could not provide. By the 1970s even a group with controversial views like Release, campaigning for the legalisation of cannabis, was able to gain grants from the government to support its service-providing activities. This was the start of a relationship where the government turned to charities for help and they received financial assistance in return.

Does history suggest there might be problems with future plans for charities?
AM: Over time, it appears that a number of charities have become increasingly reliant on state support – some groups receive as much as 99 per cent of their funds from government. But can such groups remain independent? Critics have suggested that charities have been swallowed up by the state.

At the same time, drawing heavily on state funds may prove problematic in times of economic hardship. Many charities experienced significant difficulties following the oil shock and economic downturn of the 1970s.

Public spending was squeezed and government funding for voluntary organisations began to dry up. As more recent concerns about charities that had money invested with Icelandic banks illustrates, voluntary organisations are not insulated from wider economic and financial shocks. Yet it is likely that their services will be increasingly needed as the British economy slides into recession.

Pundit from the past: William Beveridge

How would the man who paved the way for the welfare state view today’s charities?

He is most closely associated with the vision of monolithic and revolutionary public services. But economist William Beveridge, whose 1942 report, Social Insurance and Allied Services, laid the foundation for the welfare state, wrote a much less remembered report in 1948 on voluntary action.

Beveridge believed that the state should take the lead in slaying the five “giants” of want, disease, squalor, ignorance and idleness, says Dr Mold, but he believed “it could not do this alone”. The welfare state could not take on all the work charities and others had done before. Charities would still work in areas of “special need” such as care of the elderly, the disabled and unmarried mothers and their babies.

Nor did Beveridge think it desirable that people should leave everything to the state. “He believed that simply providing services was not enough to make a good society: citizens themselves should participate”, adds Dr Mold. Beveridge also thought “voluntary organisations could bring about a more ‘proper’ use of leisure time in contrast to the ‘wasteful’ pursuits of cinema going and gambling”.

But over half a century into the welfare state’s development, the range and scale of today’s charitable activity would, thinks Dr Mold, have surprised Beveridge. “Modern charities deal not only with the ‘new’ problems that have appeared since his time, such as illegal drug use, but also the persistence of ‘old’ problems such as poverty. He produced his reports during a period of great optimism; he would have been hugely disappointed to see that the five giants have not been successfully put to rest.”

And what would he have made of today’s politicians’ desire for a closer relationship between charities and the state? Beveridge was in favour of direct grants from government to charities, Dr Mold points out: “But he may not have liked the kinds of contractual relationship common today – he might have seen this as compromising the independence of charities”.

But what he would probably have disapproved of the most, she believes, is when the voluntary sector adopts a more private sector approach. While acknowledging its value in some areas of voluntary action such as life assurance, he asserted that “the business motive is a good servant, but a bad master, and a society which gives itself up to the dominance of the business motive is a bad society”. These, says Dr Mold, are words that “seem to have a particular resonance today”.

Dr Alex Mold is a specialist in the history of voluntary organisations at the London School of Hygiene and Tropical Medicine

This series is produced with History & Policy. You can find out more about them and read their papers at

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