1.1 Structure and regulation in the voluntary sector
Different institutions in society can act for the good of the public. Traditionally, there are three sectors: the public sector, the private sector and the voluntary sector, and each of these three sectors has a role to play in social development.
The public sector includes organisations that provide basic public services such as armed forces, policing, roads, education and health. These services are provided through income from taxation and, in the UK, national insurance. The public sector spends by far the largest amount on social welfare activity.
The private sector includes organisations and individuals that provide goods and services and their primary aim is to make a profit; for example, shops, manufacturers, financial services, etc. Profits are distributed to owners and shareholders as well as reinvested. Many private sector organisations endeavour to act in a socially responsible way through providing good conditions of employment, being a good citizen in the local community and supporting a clean environment by not wasting resources.
The voluntary sector is different from the other two sectors because it is not-for-profit and is not government controlled like the public sector. Traditionally, it has occupied a third space and sits between the public and private sectors. The third space is one where needs have not been met because the private sector has not seen it as profitable to do so and the public sector has either neglected these needs or not been able to afford to address them.
However, boundaries between the sectors have become more blurred. Think of private sector organisations now running services that used to be provided by local authorities or hospitals (for example, cleaning or waste collection). As the public sector has developed and evolved, the interface with the voluntary sector and its relationship with voluntary organisations as providers of services has changed and continues to change dramatically.
Public sector libraries are often run by volunteers instead of paid staff. There are also more partnerships between the sectors – for example, a new NHS hospital built using private sector finance – or voluntary organisations working with local authorities to provide social housing or care for children with disabilities. Another growth area is social enterprises which, although they are businesses generating profits, also have social or environmental goals.
Most organisations in all three sectors are regulated or inspected in some way so that customers or clients are protected. Organisations such as the Financial Services Authority, Ofcom, and the National Audit Office are often in the news reporting on some aspect of public or private organisations’ work. The voluntary sector is also partially regulated: this is the case of organisations that are registered charities, however not all voluntary organisations are registered. Those that are registered are subject to the Charities Act 2011 (England and Wales), the Charities and Trustee Investment (Scotland) Act 2005, the Charities Act (Northern Ireland) 2008 and the Charities Act (Northern Ireland) 2013. Registration and regulation of charities is done by the Charity Commission in England and Wales, the Charity Commission in Northern Ireland, and in Scotland by the Office of the Scottish Charity Regulator (OSCR). Fundraising by charities is also subject to regulation and this is done by the Fundraising Regulator.
Learning outcomes