An international sector - cuts ahead?

The third sector is growing around the world. My good friend and colleague Professor Lester Salamon of Johns Hopkins University in the States has been on a mission for years to get a proper statistical account of third sector activity.

A recent article by Lester, published in the Annals of Public and Cooperative Economics, "Putting the Civil Society Sector on the Economic Map of the World", is worth a look.

He argues that the past twenty-five years have witnessed a spectacular expansion of philanthropy, volunteering, and civil society organisations throughout the world.

Despite the promise that this development holds, however, the civil society sector is poorly understood by policymakers and the public at large, often encumbered by legal limitations, and inadequately utilized as a mechanism for addressing public problems. One reason for this is the lack of basic information on its scope, structure, financing, and contributions in most parts of the world. This lack of information is due in part to the fact that significant components of the nonprofit sector fall within the non-observed, or informal, economy, and in part to the way even the observed parts of this sector have historically been treated in the prevailing System of National Accounts (SNA).

The paper provides an overview of a series of steps that have been taken over the past 20 years by researchers at Johns Hopkins and, more recently, with officials in the United Nations Statistics Division and the International Labour Organization to remedy this situation, culminating in the issuance and initial implementation of a new United Nations Handbook on Nonprofit Institutions in the System of National Accounts and the forthcoming publication of a new International Labour Organization Manual on the Measurement of Volunteer Work.

Taken together, these efforts point the way toward putting the civil society sector on the economic map of the world for the first time in a systematically comparative way.

This article can be found here:

There are two points to be made about this. First, we can learn a lot ourselves as Leaders if we examine the growth of the sector in other countries. That is the base of the work that Euclid is doing in Europe.

The second point I often make to politicians here is that they often regard our sector only in the context of our work in volunteering or society more generally, and forget our economic power and strength. There is a danger that the "Big Society" idea is being reduced to a debate about citizen and community involvement and volunteering and forgetting the major role we should be playing in economic recovery and in providing more cost effective public service. We shall see whether Tuesday's budget takes up the challenge of progressive cuts or does the usual salami slicing. There is an unpleasant macho like approach to cuts at present which appears to glory in the process even though we can already see that front line services will be affected.

They have yet to engage effectively with the sector in discussion about how we could contribute to the process of reform by what Richard Reeves on Thursday called "progressive cuts". They need to begin discussions with the sector quickly.