The Rubber and the Road: A Workbook for Implementing the Codes of Good Practice

4. Moving forward … on funding

Over the long term, improvements in the sectors’ funding relationship should result in substantial gains on both sides – including greater accountability in the funding process, strengthened sustainable capacity among voluntary sector organizations and more transparency, consistency and understanding between the sectors. Take some time to rate yourself or your organization on the selected good practices that follow and see what areas are most in need of improvement. You may also want to make a quick assessment of how the other sector is doing on its good practices.

Once you’ve completed the assessment, go through the questions suggested below for some ideas about how you can move forward.

A. Good practices for both sectors
(you can use this chart to assess your practices and those of the “other”)

Ask yourself …

• What types of funding, if any, does your organization provide to/receive from the “other?”

• What are the major strengths/weaknesses of your funding relationship – from your perspective and from the other sector’s view?

• If you could change one thing about the funding process, what would it be?

Some tools to work with …

Check out the following funding information about the two sectors and consider:

• Whether there are advantages/disadvantages to the voluntary sector of the various types of funding (contributions, contracts, grants, etc.)? To the Government of Canada?
  
• Whether there are any funding arrangements that might better suit your relationship with the other sector?

What the Government of Canada supports

Each department and agency of the Government of Canada determines the type(s) of funding best suited to its mandate and policy objectives – these may include contributions, grants, contracts and other transfer payments. Although most funding is allocated for a one-year period, some departments and agencies also provide funding on a multi-year basis for activities such as:

• program and service delivery
• strengthened sustainable capacity
• strategic investment
• alliances and partnerships
• policy dialogue
• advocacy
• research
• innovation
• capital expenditures

About voluntary sector financing

The voluntary sector draws its support from a variety of sources, including:

• $5 billion from financial and/or in-kind donations from Canadians
• millions of people who volunteer their expertise and labour
• governments, foundations, charitable funding organizations and corporations
• funds raised by voluntary sector organizations through service fees, product sales, investment income and other charitable fund-raising activities

Following are some good practices for each sector (Government of Canada = GC; voluntary sector = VS) pulled from the Code. For a complete list of the Code’s good practices, go to the VSI web site: www.vsi-isbc.ca

Ask yourself …

• What are you doing now to put these good practices into action?

• How can you build on these activities?

• Are there any barriers to moving forward and, if so, what can you do to overcome them?

• For each of the above areas, what other good practices can you put in place to strengthen and simplify funding practices?

Some tools to work with …

More about accountability…

… for voluntary sector organizations
Effective governance and accountability begin at home. For voluntary sector organizations, this means ensuring that you have the appropriate processes and structures in place to direct and manage your operations and activities, and ensure that they function well. Effective board governance involves, among other things*:

Think about: how your organization rates on accountability whether your current governance/accountability regime is affecting your funding relationships what structures and processes your organization needs to bring it up to scratch

• steering toward the organization’s mission and guiding strategic planning

• being transparent, including communicating to members, stakeholders and the public and making information available on request

• developing appropriate structures

• ensuring the board understands its role and avoids conflicts of interest

• maintaining fiscal responsibility

• ensuring that an effective management team is in place and overseeing its activities

• implementing assessment and control systems

• planning for the succession and diversity of the board

… for Government of Canada departments and agencies

Think about how you and your organization can accommodate the varying needs, practices and capabilities of voluntary sector organizations and, at the same time, be accountable for public money, for example, by:

• taking into account monitoring procedures already agreed to by a voluntary sector organization’s other funders, as well as any quality assurance system introduced by the organization, when discussing the content, quality and format of Government of Canada information needs

• agreeing on well-defined measurable results and clear roles and responsibilities

• recognizing and respecting the different ways that community groups can manage their resources and still meet accountability requirements
  

Consider this …

Almost every facet of Canadian life is affected in some way by the Government of Canada. In addition to providing essential services such as national security, environmental protection, maintaining national parks and providing transportation services, the federal government contributes to the development of Canadian and global economies, and sustains relations with other countries and organizations around the world.

In carrying out these diverse roles, the Government of Canada provides direct and indirect support to programs and services delivered by voluntary sector organizations. For example, in 1997-98, the government made about $2.2 billion in direct payments to voluntary sector organizations and provided $1.5 billion in indirect support to the voluntary sector through personal and corporate tax credits for charitable donations and GST rebates available to non-profit organizations. In addition, tax assistance is provided through the sales tax rebates to charities and the benefits associated with their tax-exempt status.

If you work in a voluntary sector organization that receives Government of Canada funding, think about how you can simplify the processes for funding by, for example:

• collaborating with other voluntary sector organizations to share innovative funding approaches
  
• working with government funders to identify innovative funding approaches and develop user-friendly forms and reporting requirements

If you work in a federal government department or agency that provides funding to the voluntary sector, think about how you can simplify the processes for funding by, for example:

• identifying “boiler plate” information that applies to more than one program
  
• developing harmonized processes within/across departments to facilitate joint funding when several programs/departments are working collaboratively with a common client
  
• ensuring minimum duplication and requiring only essential information
  
• making information on funding processes readily available
  
• engaging the voluntary sector in discussions about innovative approaches and tools
  
• providing sector organizations with access to useful planning tools