It has an estimated income of£30bn, volunteers contribute£25bn worth of work, and it provides one in 25 jobs. This is not to mention its diversity and community links, and as such the voluntary sector should have a major role to play in partnering councils to deliver best value.
The truth is that best value has only slowly begun to have an impact on the voluntary sector. Councils are missing a real opportunity by failing to consider the sector seriously as an alternative provider of services as well as a powerful voice for those who struggle to be heard.
Early evidence from work undertaken by the Improvement and Development Agency raises some key questions. Are councils being too inward-looking in putting their best-value reviews and plans in place? Is it enough for them to examine only their own grants budget and administration when looking at the voluntary and community sector in the light of best value?
The variety to be found in the voluntary sector - from the big-name charities and national not-for-profit organisations through to the small neighbourhood lunch clubs and playgroups - creates wide-ranging potential for innovation and diversity in meeting the needs of local communities.
Getting the relationship right is the first step in realising this potential.
Large voluntary organisations contracted to a number of council service departments complain of different procurement and performance reporting requirements for each contract. Small grant-aided groups worry about an uncertain future as the functions they undertake are subject to reviews under a council-determined timetable.
Many worry about the future of their grant-aid. They fear that delivering council-defined projects will dominate their work, and that the costs of running core services will not be met, or will be met at an insufficient level.
These are real fears, but there is widespread recognition that best value offers many opportunities to tackle some of the more protracted problems governing relationships between councils and the voluntary sector. For example, many of the initial reviews are recommending greater stability and forward planning through the introduction of three-year funding schemes for the voluntary sector.
Some councils qualify such three-year commitments by saying that funding beyond the first year should be subject to the usual constraints of their financial planning cycle. But this is generally felt to be an improvement on the uncertainties of annual funding rounds. A more strategic approach to funding should become the norm if the proposals in the local government finance green paper reach the statute book.
In turn, this seems to be dissipating worries about voluntary-sector groups losing their independence through a process that transforms them into mere subsidiaries of the council. The ability to plan over a three-year period is a means of bolstering the independence of voluntary groups - a view shared by the voluntary sector itself - since this enables these groups to lever in money from other funding bodies and sources.
Councils should recognise the attraction of this arrangement because this cash is of benefit to their communities - especially where the distribution of funding is dependent on the existence of partnerships with the voluntary sector and others.
-Rob Pearce is senior best value consultant at the Improvement and Development Agency, Alan Ali is an independent consultant.