Shadow minister wades in to Big Society Network funding controversy

Shadow minister for civil society Gareth Thomas has tabled a series of Parliamentary questions to minister Nick Hurd about the government's funding of Big Society Network and its allocation of Social Action Fund money.

The questions were tabled just as Nesta has confirmed that it gave statutory grants totalling £480,000 to Big Society Network in 2010 without holding a competitive pitch, to help it set itself up and deliver various projects.

This total £480,000, combined with £245,332.66 of Cabinet Office funding paid to Big Society Network between May 2010 and July 2012, revealed in a Freedom of Information (FOI) Act response last September, brings to at least £725,000 the total public money paid to the private limited company since it launched with David Cameron’s backing just after the 2010 general election.

This total climbs to over £925,000 if the £199,900 Social Action Fund grant paid last year to BSN’s associated charity, Society Network Foundation (SNF), is included.

None of this funding has yet been recorded in any published accounts. The SNF grant was only added to the published list of successful applicants after a member of the public found out about it and complained that it was missing.

Thomas: 'Money wasted on Big Society vanity projects'

The various stories covered by civilsociety.co.uk recently about statutory grants to BSN and SNF has prompted shadow civil society minister Gareth Thomas to accuse the government of “wasting money on Big Society vanity projects” and to table a series of questions in Parliament.

Thomas told civilsociety.co.uk: “At a time of acute pressure on charities and the voluntary sector these reports are very worrying; huge sums of taxpayers’ money appear to have been paid to Big Society schemes which have later been abandoned – often due to a lack of interest.

“I’ve tabled a series of Parliamentary questions and will be following this issue closely. I hope ministers will similarly take a transparent approach – the sector has lost billions of pounds and the effects are being felt in our communities. The last thing we need is ministers wasting money on Big Society vanity projects.”

His questions relate to funding allocated by the Cabinet Office to BSN, contracts between the Cabinet Office and BSN, and how many applicants to the Social Action Fund successfully obtained funding despite not meeting the published criteria and application deadline.

Nesta grants totalled £480,000

The latest disclosure from Nesta followed an FOI request from civilsociety.co.uk regarding grants to Big Society Network when Nesta was a non-departmental public body sponsored by the Department for Business Innovation and Skills (BIS). Nesta has since been spun off as an independent charity.

Nesta confirmed that in December 2010 it awarded a grant of £400,000 to Big Society Network Ltd – £150,000 to part-finance the core costs of running the organisation in its early stages and the remaining £250,000 to support three projects subject to matched funding being raised and milestones being achieved.

These three projects were Nexters, Spring, and It’s our community.

There was no competitive pitch for the money.  A Nesta spokeswoman said: “While the vast majority of Nesta’s grants are made following open calls for proposals, we do have the ability to provide grants to projects that fit with our vision and advance our objects outside of open calls for proposals. That is what happened with the grants to the Big Society Network.”

Nesta also confirmed that it gave BSN £80,000 in August 2010 to support a project called Your Local Budget, which explored “innovative approaches to participatory budgeting”.

No disclosure in accounts

Big Society Network is a company limited by guarantee, not a charity, and as it has annual income of less than £6.5m, it does not have to file full accounts with Companies House.  Thus, the unaudited accounts filed for the year to 31 March 2011 contain nothing more than an abbreviated balance sheet showing a deficit of £25,141 – there is no published record of the £480,000 from Nesta being received or spent.

BSN’s accounts for the following year are currently nearly four months overdue, though a striking-off order by Companies House has been withdrawn after BSN filed its annual return earlier this month.

Society Network Foundation, the registered charity that received the Social Action Fund money, has also just won a £1m grant from the Big Lottery Fund.  Its accounts filed with Companies House so far state that it has been dormant since launch.  The next accounts, for the year ended 31 March 2013, are due to be filed at the end of this year.

The Nesta funding was provided just months after Big Society Network’s founding chief executive, Paul Twivy, was publicly insisting that BSN would not take any government money.

Nesta told civilsociety.co.uk that all the money was paid to BSN Ltd in 2010 on the condition that it would soon be setting up a charity and that the funding would be directed towards that foundation’s charitable objects.  

Andy Rich, partner at chartered accountants HW Fisher & Co, commented: “The Big Society Network accounts are surprisingly thin on detail. While it is not a charity, it is a private, limited company that uses its income entirely for social or charitable purposes.

“So it is odd that it has not prepared and filed its accounts in the standard charity Sorp format, but instead has published abbreviated accounts which show very limited information."

Big Society Network CEO Steve Moore did not respond to enquiries.

Two questions on Big Society Capital charity

Gareth Thomas has also tabled two questions relating to Cabinet Office funding of Big Society Foundation, the charitable arm of Big Social Capital, "in order to get a fuller picture of the funding going to Big Society-branded projects".

Nick Hurd has to respond by 3 June.

This article was taken from Civil Society – http://www.civilsociety.co.uk/finance/news/content/15213