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Introducing the voluntary sector
Introducing the voluntary sector

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3 Contribution of the voluntary sector to the UK economy

A further important aspect of the voluntary sector relates to its contribution to the economy, and is measured as a monetary value. Information is available for all sectors and is measured as gross value added (GVA). In terms of the voluntary sector, NCVO (2015a) reports that in 2012/13 the value of the voluntary sector’s output was £12.1 billion, which is almost 0.7% of the GVA of all UK industries.

However, this is not the full picture: what about the contribution of volunteers? GVA is based on paid staff, as well as spending and income. There have been numerous attempts to put a monetary value on the work of volunteers and a key one is to think about the replacement cost, i.e. how much would it cost to replace volunteers with paid staff? The Office for National Statistics ONS (2013) estimates this as £23.9 billion.

Is it helpful to think about the voluntary sector purely in monetary terms? You saw in Week 2 that social value is being introduced to government contracts with the voluntary sector but it is hard to quantify. The following quote is by Kathy Evans, Chief Executive of Children England. She raises concerns regarding always thinking about contributions in terms of money:

Yet to quantify our ‘added value’ we talk in pounds and pence – the money we raise, the paid equivalent of volunteers’ time, the money we save others by helping people in need. How did our sector come to be so defined, and yet poorly described, by money instead of feelings?

(2014)

Some of this overall data may feel a little remote to you on a day-to-day basis in your work, volunteering or general interest in the sector but it is useful to have a sense of how the voluntary sector is valued in monetary terms because that is a reality of being in the sector. The idea of value and valuing comes up time and time again with the voluntary sector and having data – and skills in making sense of it – helps with understanding these concepts.

Next the focus switches to the activities and function of voluntary organisations and this also helps lead into the idea of understanding difference within the sector.