The false economy of short-term funding has gone on for far too long, says Derek Mitchell

The Scottish Parliament has been holding an inquiry about how to fund the essential work of the third sector. A chance to finally tackle some long-standing issues with the current funding model, making this both more effective and efficient, delivering services that really do improve lives.  

Most third sector organisations, including the network of 59 CABs across Scotland, receive funding on an annual basis. This means at the end of each year, there is huge uncertainty about whether funding will be renewed. The immense stress this places CAB staff under cannot be understated. 

At its heart, advice is about bringing stability to volatility. And yet, this approach means our advisers’ own livelihoods are often marked with precarity and at the mercy of short-term funding cycles. CAB managers are all too painfully well acquainted with the annual process of issuing redundancy notices to staff as the new financial year approaches because funding is yet to be confirmed. The worst task of the year so many have told me.  

Can you imagine having to help support someone through financial crisis while your own job security is uncertain? The impact that has on our adviser's wellbeing? Or the pressure of witnessing demand soar without knowing whether you will have sufficient capacity to meet that? 

While funding is increasingly precarious and uncertain – one thing remains certain and constant: the essential service provided by CAB network all across Scotland continues to experience record-breaking demand. Increasing numbers are matched with increasing complexity – we are supporting people who are presenting in ever more urgent and traumatic circumstances.   

Even in this desperately difficult context, we secure real change – the network helped over 187,100 people in 2022-23, resulting in £142.3 million being unlocked in local communities. 70% of people reported the advice they received improved their mental health and wellbeing. 91% felt the support they received increased their confidence in dealing with issues in the future. This is advice that changes lives. Imagine what more we could achieve for people with secure and sustainable funding? 

Can you imagine having to help support someone through financial crisis while your own job security is uncertain? The impact that has on our adviser's wellbeing?

That message runs throughout our response to the inquiry: long-term, secure funding for the third sector would be game-changing. It would have a truly transformative effect in terms of delivering the much-needed job security to the people delivering life changing advice, ensuring that we retain local knowledge and expertise in local communities to really help people. 

Our response echoes the cries of the whole third sector – the false economy of short-term funding has gone on for far too long. Long-term problems demand long-term solutions. Failure to do so is costing all of us. Multi-year funding is the foundation that our work should be built on.  

This year marks the 85^th anniversary of the CAB, demonstrating the staying power of the network. We ain’t going anywhere! Yet the effectiveness and efficiency of our work would be exponentially improved through funding stability. Multi-year funding is far from a radical idea, yet it would have a radical impact for the communities CABs support. Reducing poverty and its harmful impacts on communities cannot be done within an annual budget cycle. We need change.  

We welcome the focus of the parliament to build a more resilient and effective third sector, capable of better serving Scotland’s communities. We must seize this chance for change. The cost of not doing so doesn’t bear thinking about. 

Derek Mitchell is chief executive of at Citizens Advice Scotland.

This column was first published in the Herald.