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Chamber and committees

Meeting of the Parliament [Draft]

Meeting date: Wednesday, March 20, 2024


Third Sector (Economic Contribution)

The Deputy Presiding Officer (Annabelle Ewing)

The final item of business is a members’ business debate on motion S6M-11864, in the name of Kate Forbes, on the economic contribution of the third sector in Scotland. The debate will be concluded without any question being put.

Motion debated,

That the Parliament celebrates the third sector in Scotland, which includes charities, community and voluntary groups and other non-profit distributing organisations, including those in the Skye, Lochaber and Badenoch constituency; understands that the third sector primarily provides services that are important in reducing inequality and disadvantage, and in improving health, wellbeing and community cohesion; believes that there is an important relationship between the third sector, the private sector and the public sector; welcomes the publication of the Royal Society of Edinburgh (RSE) advice paper on 13 December 2023, titled The economic contribution of the third sector in Scotland, which identifies that the sector is “often overlooked as a source of wealth generation and seldom included in national or local growth strategies”, leading to missed opportunities to enhance regional and national economies; considers that the RSE’s report highlights the substantive economic contribution of the sector, whilst identifying the barriers to a wider recognition of the third sector’s economic contribution; notes the belief that overcoming such barriers to the third sector’s recognition in the Scottish Government’s economic strategy is of increasing importance in the context of the financial and funding challenges currently facing the sector, and notes the RSE’s call to stimulate debate on how these blocks might be overcome.


Kate Forbes (Skye, Lochaber and Badenoch) (SNP)

I think that everybody in the chamber is familiar with the incredible reach, depth and variety of the third sector. Right now, it is working to reduce inequality, improve health outcomes, increase the wellbeing of our citizens, provide housing, cement community cohesion and provide opportunities—the list goes on. I am sure that we will hear just how far that reach goes in all members’ speeches.

The third sector genuinely covers every area of Scotland in terms of the area in which it works and in terms of geography. To do that, it employs people and creates jobs, purchases and procures goods and services, and engages in commercial activity. In short, above and beyond all the other tasks that it does, one of its aims and objectives is to generate wealth. In fact, we could argue that the third sector in Scotland today is doing far more to level up than any national strategy is because of its presence and efforts in every region of Scotland.

Some of the best work that I have seen in particular subject areas is delivered by the third sector. Highland Home Carers does an incredible job—it does pioneering work—in training care workers and delivering care. Earlier today, I met a fostering and adoption charity that is rising to the challenge that was set by the Scottish Government in respect of recruiting more foster carers. The third sector is relieving hunger across Scotland through the provision of food banks and working to provide opportunities for sports, music and employment in every part of Scotland.

Thinking back to work that I have previously engaged with in setting out Scotland’s 10-year economic strategy, I realise that many of the goals that are set out in that strategy are already being delivered by organisations in the third sector. Some ways in which the third sector contributes to the economy are obvious. I have already mentioned that it is an employer, that it purchases goods and services, and that it invests in buildings and equipment. However, it is absolutely essential that we think of the economy in a different way if we really want a sustainable and inclusive economy. That is what the report that we are debating today does.

We want to ensure that wellbeing is embedded in our delivery of economic goods to all of Scotland’s communities, and one way in which the third sector does that is by supporting people to become economically active through employability programmes. The third sector is able to reach people that the state, the Scottish Government and its agencies are often unable to reach. It also funds research and development programmes. Although Scottish Government funding is absolutely essential for research and development, the third sector, through fundraising and so on, is often able to invest in research and development that the Government or the private sector is not able to invest in.

The third sector is also able to tackle issues such as mental health, poverty and promoting a healthy workforce in perhaps a slightly more nimble and agile way.

Finally, social enterprises create new markets and organisations by altering cultural norms of behaviour, as well as contributing to changes in consumer preferences. What is so interesting about social enterprises is that some of them identify as being in the private sector and others identify as being in the third sector.

One challenge that faces the third sector, as defined in the report, is the challenge of being adequately defined and therefore its contribution being properly quantified. As we have previously discussed and we will discuss in the course of this debate, the third sector is not homogeneous. It is interesting that the Scottish Council for Voluntary Organisations identifies social care and housing as the two largest activities by income, followed by culture and sport, community work, education, health and religion. However, the organisations involved can vary from very small local organisations that are staffed entirely by volunteers all the way through to national or, indeed, international charities that employ hundreds or, in some cases, thousands of people.

The Fraser of Allander Institute says that third sector organisations contribute significantly to most sectors of the economy. If members want proof of that, they should ask themselves what our economy would look like without that sector operating in that area.

That is why this debate is so important. I think that everybody in the chamber shares our objective of delivering a sustainable and inclusive economy. The economy is the backbone of much of the other work that we do, but none of our aims in the economy can be achieved through the private sector or the public sector working independently of the third sector. We absolutely need the third sector as part of our efforts to build a sustainable and inclusive economy. That calls on all of us to acknowledge and to try to get a grip of the actual quantum of work that it does so that we can include that more obviously in our discussions about the economy. When we talk about economic development, the third sector needs to have parity of esteem with the private and public sectors.

My last point is that the only hope that any of us has of solving whatever economic challenge is under debate is by working across the third, private and public sectors, which means that we must acknowledge the work of the voluntary and third sector and must pay tribute to that sector. That should not be done through rhetoric alone, but must be embedded in national economic strategies and in our budgets.


Ruth Maguire (Cunninghame South) (SNP)

I congratulate Kate Forbes on securing this important debate and highlighting the positive impact of charities, community and voluntary groups and other non-profit-distributing organisations.

Third sector organisations can be the backbone of communities. They offer a range of services and often help to alleviate societal difficulties such as food poverty, loneliness and social isolation and generally making life better. I am sure that everyone here can think of many organisations in their constituencies that do just that. I know of organisations ranging from community larders providing access to groceries and the Community Led Action and Support Project’s hope in the community work with older citizens to larger charities such as Barnardo’s and Aberlour, to name just a few.

The Westminster-induced cost of living crisis means that such organisations are plugging gaps in services that were previously publicly funded, while, like everyone else, navigating rising costs and inflation. In doing so, they contribute to, and help to reduce, public expenditure, as was highlighted by the Royal Society of Edinburgh. Thousands of organisations are helping to balance our delicate social fabric.

During my time as convener of the Equalities and Human Rights Committee back in 2019, we published a report about valuing the third sector, which recognised the economic contribution of the third sector as being higher than that of the whisky industry and not far behind that of the Scottish tourism sector. Recent figures, published by the Scottish Council for Voluntary Organisations in 2022, show that economic contribution as £9.2 billion, up from £8.5 billion in 2021, while third sector spending was £8.8 billion, up from £7.9 billion in 2021.

Despite that growth in the third sector, its contributions remain obscured, as Kate Forbes explained in her opening speech, and its struggles are pretty unrelenting. In June 2022, Age Scotland reported the findings from its “keeping the doors open” survey, which showed that securing funding was a recurring issue, expressed the view that multi-year funding would be beneficial for increased financial security and the delivery of longer-term projects and said that single-year funding models, which required organisations to show impacts in just one year, made it more likely that they would be able to interact only with communities that they already engaged with. The 2019 report that I spoke about also picked up on the impact of single-year funding on the hugely important staff employed in our communities.

The Royal Society of Edinburgh’s report, echoed by the SCVO’s latest findings in the Scottish third sector tracker, continues to identify finance as a top priority. I understand that the Scottish Government is working with other statutory funders to consider how partnership working can be encouraged in a competitive funding environment and I would be interested to know how the findings are being used to design and develop meaningful collaboration between all sectors.

Economic activity should serve the purpose of meeting everyone’s basic needs and improving our collective health and wellbeing, so that all of Scotland’s people and places can thrive and prosper. The voluntary sector meets the vision of the national strategy for economic transformation by harnessing innovation, entrepreneurship, research and development, partnership and prevention and by supporting people into employment.

Building successful and trusting relationships between the third and public sectors is achievable. We saw that during the pandemic when the third sector played a key role in supporting the public sector and it was evident that existing relationships became stronger and new ones were created. There was the removal of bureaucratic barriers alongside joined-up working, which empowered people to work together quickly and efficiently. That made such a difference to folk on the ground. It was a better way of working.

Fairer funding opportunities and balanced power and resources for third sector organisations can help to overcome barriers and recognise our vision for Scotland as a wellbeing economy.


Miles Briggs (Lothian) (Con)

I start by congratulating Kate Forbes on securing this debate, which gives us an important opportunity to celebrate our charitable and third sectors in Scotland and to acknowledge the positive economic contribution that the third sector is making to Scotland. As has just been mentioned, all of us recognised that during the pandemic, when the third sector stepped up to help our society.

I also thank the organisations that provided useful briefings ahead of today’s debate. Some of the statistics that the Royal Society of Edinburgh and the Scottish Council for Voluntary Organisations provided us with ahead of today’s debate show the vital impact of the third sector—its important economic impact in particular, which I had not been fully aware of but which involves a huge amount of money, with £7.9 billion having been spent by the sector in 2021, rising to £8.8 billion in 2022. That spending impacts on everyone’s lives—that is one of the things that the debate has already shown.

It is also important to recognise the positive impact that the charitable and third sectors make in relation not only to reducing public expenditure but to maximising its benefit by providing services in sectors such as health, social care and education, and often doing so better than our national health service or our local authorities. I say that because, often, the third sector and charitable sector will take forward a more innovative sector-specific or person-specific solution. That is something that we should celebrate, and it is vital that we capture that.

I will give an example of that from my Lothian region. NHS Lothian looked into waiting times for child and adolescent mental health services—we have often heard MSPs complaining that it is unacceptable to leave people on long waiting lists. As a result, the health board has embraced a lot of work with the third sector to review CAMHS cases and, where appropriate, to get people into early intervention services that are run by mental health charities. That is helping to support families and individuals, instead of just leaving them on a waiting list. That is an example of an innovative solution that we should all celebrate and want to see being extended.

As Kate Forbes said, we also need to look to the third sector playing a more national role in our society and being at the table in relation to national and regional economic strategies.

Parliament should also allow the sector to come into our processes. Parliament and Governments—previous ones, as well as this one—have failed to take the opportunity to bring in the third sector at earlier stages. For example, in integration of health and social care it was a mistake not to have the third sector at the table earlier. I say to ministers that, in relation to development of the national care service, we should not make that mistake again. There is an opportunity, as the proposal progresses through Parliament, to embed the third sector in the process.

Emma Harper (South Scotland) (SNP)

I am on the committee that is gathering evidence on the National Care Service (Scotland) Bill. We have included the third sector in our evidence sessions. Does Miles Briggs welcome that? As he rightly says, the sector’s involvement is valuable.

Miles Briggs

I absolutely agree that the sector’s involvement is valuable. However, having the sector at the table when it comes to decision making and commissioning of services will be really important. A lot of the work that the sector has done beyond integration of health and social care has been done outside the room. It is really important that we ensure that the sector is involved in commissioning services.

Members will be aware that I have launched a consultation on my member’s bill on the right to palliative care. In that area, the third sector—the hospice sector, in this case—is not embedded in the conversations on budgeting, and decisions that are being taken by the Government see it facing a £16 million black hole in staff budgets. That is an example of where we need to embed the sector in decision making.

Members will be aware that a Children’s Hospices Across Scotland reception will be held in the garden lobby this evening. It is one of many organisations that are doing fantastic work. Parliament needs to celebrate them, but we also need to engage better with them and to open up opportunities for them to do more and to make a bigger difference.

To conclude, I thank Kate Forbes for bringing the debate to the chamber and I thank members for contributing to it. We have a huge opportunity to encourage and nurture our third sector. We all want to celebrate the sector and make sure that that happens.


Foysol Choudhury (Lothian) (Lab)

I thank Kate Forbes for bringing this very important debate to the chamber. I have been involved in third sector organisations all my life, so I know the difficulties that they face.

Scotland’s third sector makes a vital contribution to Scottish society. Sadly, the contributions of that important sector are too often overlooked and undervalued. That is further represented in Scottish Government funding models, through which we see third sector organisations losing out time and again.

In January this year, I hosted a round-table meeting for third sector community organisations in the Lothian region. I was told by many community organisations that the current grant and funding model is confusing and time consuming for smaller organisations, which do not have dedicated fundraising managers, which means that smaller third sector community organisations lose out and cannot provide the services that are desperately needed in their communities.

Acknowledging the economic contribution of the third sector means accepting the need for more investment and support to keep those vital organisations up and running. The Royal Society of Edinburgh’s report on the economic contribution of the third sector in Scotland highlighted that the third sector is often overlooked as a source of wealth generation and is rarely included in national or local growth strategies.

In order to reap the reward of the vast economic contribution that the third sector makes we must give it the recognition and funding that it deserves. The Scottish Government has made commitments to a wellbeing economy, but those commitments cannot be reached without the important work of the third sector.

The range of work that is done by the third sector is incredibly wide and long lasting. Since 2020, increases in use of food banks and in use of temporary accommodation and the increase in energy prices have meant a significant increase in demand for services.

During the Covid-19 pandemic, and subsequently, third sector organisations worked around the clock to provide support, but because of the current financial situation, core funding is reducing and many vital organisations cannot offer the level of support that they once offered. We will see the impact of that in our economy if more investment is not made.

It is clear that barriers still exist to allowing wider recognition of the third sector in Scotland. The RSE report highlights that there appears to be “cultural resistance” to involving charities and other social organisations in programmes. The report also highlights that charities often feel that they are not taken as seriously or deemed to be as “professional” as other organisations. That culture leads to third sector organisations missing out on opportunities to expand and to contribute to our economy and society as a whole. Its contributions are vital and we should support them.

I welcome the report and hope that it will lead to barriers to access being torn down and to third sector organisations getting the recognition and support that they deserve.

I apologise: I will not be able to stay until the end of the debate, because it is Ramadan.


Emma Harper (South Scotland) (SNP)

I congratulate my colleague Kate Forbes on securing this important debate, which allows us to recognise and promote the importance of the third sector. Kate Forbes outlined very well in opening the debate the third sector’s contribution to the Scottish economy, including the wellbeing economy. I also thank organisations for the briefings that they provided ahead of the debate.

The Royal Society of Edinburgh’s research paper highlights much information, and I recommend that everyone read it. I know that members will have read it, but I encourage others to do so, too.

The third sector is an absolutely crucial lifeline for so many of our fellow citizens, through its support for people’s social needs as well as for their physical and mental health. The social enterprise landscape is, as we have heard, a diverse mix of business models across many industries and rural and urban geographies, which is a key strength. Many social enterprises are registered charities or Scottish charitable incorporated organisations—SCIOs—-and many others are community interest companies, co-operatives or other purposeful business models.

Scotland’s social enterprises contribute £2.63 billion annually in gross value added income to our economy, according to the most recent social enterprise census. The social enterprises that together make up the third sector provide around 90,000 full-time equivalent jobs in Scotland and have a net collective worth of around £7 billion. The third sector and its social enterprises are hugely important to Scotland’s economy and society. It is right that we celebrate and support them.

I will touch on the work of Third Sector Dumfries and Galloway. The team, which is led by Alan Webb, helps voluntary organisations, charities, social enterprises, co-operatives, credit unions, mutual organisations and volunteers to work together to put the sector first. It highlights what the third sector is, how it impacts on the lives of individuals and communities in Dumfries and Galloway and how it impacts on the strength and sustainability of our economy. The organisation represents the interests of the sector by lobbying opinion creators and decision makers in the Scottish Government, Dumfries and Galloway Council and NHS Dumfries and Galloway. It is essential that we value the third sector equitably, as Kate Forbes described.

Third Sector Dumfries and Galloway is part of the third sector interface network, which is funded by the Scottish Government. The TSI provides a single point of access for support and advice for the sector in local areas. That includes tackling social inequalities, fostering community empowerment and inclusive growth, working to increase volunteering and citizenship, and enabling integration of health and social care.

One of the great initiatives that has stemmed from that is increased use of social prescribing in the region. The Health, Social Care and Sport Committee recently recommended increasing the use of social prescribing following our “Social Prescribing: physical activity is an investment, not a cost” inquiry report. It is a great way for people to be supported to access treatment that is in the best interests of their physical and mental health.

Third Sector D and G works in collaboration with many groups and organisations, such as A Listening Ear, the Dumfries and Galloway Hard of Hearing Group, DG Voice, the Dumfries and Galloway Advocacy Service, Food Train and many others. Those organisations all work to support people to become economically active. I volunteered with A Listening Ear during the Covid lockdown to help to address isolation and loneliness that were being caused by the lockdown.

Work is also being done to support people and to promote digital literacy. To that end, Third Sector D and G, under the leadership of former chief executive officer Norma Austin Hart, did a great study to examine the extent of digital inclusion—I am conscious of the time, Presiding Officer—and its findings were stark and led to great initiatives that support digital literacy hubs.

I thank Kate Forbes for securing the debate and I reaffirm the need to include and value the third sector to support our economy.


Brian Whittle (South Scotland) (Con)

I, too, congratulate Kate Forbes on securing time in the chamber to highlight the importance of the third sector to the Scottish economy. As members will know, I have spoken about the third sector many times in the chamber. Although we talk about it all the time and heap praise on it, I am not quite sure that we match that with the way in which we act on its behalf. I am grateful for the opportunity to speak in the debate, and I thank the Royal Society of Edinburgh for its comprehensive document.

As has been highlighted in the motion and by previous speakers, it would be impossible for any Government to replace the monetary value of the third sector in Scotland. Governments lean on the third sector with the assumption that it can be a cost-effective way of delivering a community service, especially when third sector organisations often cater for those who are furthest removed from our society.

However, when we talk about the economic contribution of the third sector, we should not lose sight of what that means for our communities and how they would be impacted if the third sector ceased to exist, not to mention the extra burden that that would put on our statutory services, which are already creaking under huge pressures.

As is customary in such debates, I will talk about some third sector organisations in my area, such as Morven day services in Onthank, which is a drop-in centre for people suffering poor mental health. It is a lifeline for many, and it is the only place outside their home that some of them see a couple of times a week. The service uses music and art, and I have been beaten several times at pool by members there when I have dropped in. I sometimes partake in their music—they have guitars there—although members will be glad to hear that I have not tried to draw anything in their art classes.

That service, which draws together a lot of like-minded people in a safe environment, is under threat because the local council has withdrawn its funding. I worry about what will happen to the members who use that service, because they will not walk through the shiny doors of a statutory service. As it happens, Morven day services has secured some private donations that will keep the doors open for the next few months while it tries to work through the issues. However, I worry about what will happen to the very colourful and fantastic characters who use that service if it shuts down.

Likewise, what will happen if the Break the Silence service, which works with people who have childhood sexual trauma, falls? What will replace it? If we lose such services, my worry is that, although the cost will come out of the local council ledger, a much greater cost will inevitably appear in the healthcare ledger.

We Are With You, which provides drug and alcohol addiction support, and Recovery Enterprises Scotland do not just wait for service users to come to them; they go out to service users who are not able to leave their home. They work with those who are most removed from society.

Foundations hub supports people who are detained at His Majesty’s pleasure and who will need to be reintegrated into the community after serving their debt to society. The hub works with them six or eight weeks out to ensure that they have everything that they need when they come out. It also supports the families of those who are incarcerated. There is no similar statutory service to replace it.

Many of us will know about CentreStage, which has developed into a huge community asset and a meeting point. It uses music, among other things, to bring together people who might otherwise have nowhere to go and who are seeking help, company or friendship.

The third sector is under increasing financial pressure to deliver its services, most often to the most vulnerable in our society. It has the flexibility to adapt to circumstances in a way that statutory services often cannot. In many ways, we take for granted that the third sector will always be there, and that its budgets can be squeezed but that it will continue to deliver the vital economic, community and human impacts that we have been discussing. We should not take the third sector for granted. If we do, we will wake up one day and it will not be there. What will we do then? Cutting support for our third sector is a false economy—it is an economy and service that we could not replace.


Paul O’Kane (West Scotland) (Lab)

I thank Kate Forbes for securing today’s debate. For all of us in the chamber, it is always a pleasure to be able to highlight and speak about the valuable role of Scotland’s third sector in our economy and in our society. Kate Forbes set out a number of the challenges in a very considered opening speech.

I know well the impact that the third sector has on the ground, working with individuals across Scotland. Most of my career before coming to the Parliament was spent working in the third sector. I declare an interest in that regard, having worked for Enable Scotland, as colleagues probably know, before my election to the Parliament. I was able to see up close the work that it and other third sector organisations do, particularly in the learning disability and social care space.

When we think about the third and voluntary sector, it is often such engagements that come to mind. We have already heard a number of examples from across Scotland in the debate. That is how third sector organisations, through their interactions, have the biggest impact on individuals, communities and society.

When we think about the provision of support services to people in our communities, we often see the third sector going above and beyond with its delivery and being praised for its high standards. When looking at social care services, The BMJ found that regulated social care services in the third sector are frequently of a higher standard than those in the private sector and that people often choose to receive care and support from third sector organisations that they trust and that are rooted in their local community.

There are other examples of that connection and trust fostering relations. Organisations such as the Outward Bound Trust equip young people in communities across Scotland with skills for life and engage them in community projects such as the Mark Scott leadership for life award. MSPs have reached a consensus on securing funding for that project for the coming year, following strong cross-party work, and we hope that that will continue. Countless third sector organisations across Scotland need and deserve support and are at the forefront of our minds during this debate.

Kate Forbes’s motion rightly highlights something that we do not consider nearly as much as we ought to, which is the economic impact of such organisations. The SCVO’s sector statistics for 2022 estimated that 46,500 charities, community groups and social enterprises were active in Scotland, employing 135,000 paid staff, supported by more than a million volunteers. They had an estimated turnover of £9.2 billion and spent more than £8.8 billion during that period. That is a significant economic footprint, which other reports—not least the work by the Royal Society of Edinburgh, which was referred to by a number of speakers—have also exemplified.

We have heard about the importance of ensuring that the third sector continues to contribute to our growing economy. We can do that by ensuring that the sector has certainty in planning, which largely means knowing where resources will come from. It is also important that funding is fair and that its structures work for the organisations. For those who have not already seen it, I point to the SCVO’s list of fair funding asks of the Government. It calls for multiyear funding, uprating and better communication and dialogue about funding awards. We should reflect on all of that, and I hope that the minister will say something in her summing-up speech about the progress of the Government’s fair funding review, because the SCVO is keen to see progress on that.

It is clear that we must ensure that the third sector is at the heart of Scotland’s economy, as a considerate and respected partner. We realise the potential of the third sector, which Kate Forbes’s motion rightly highlights, and that it can continue to make a huge contribution to Scotland now and in the future. I think that everyone here agrees with that, but we must do more to support charities across Scotland.


The Minister for Equalities, Migration and Refugees (Emma Roddick)

I thank Kate Forbes for this debate, because it is wonderful to have the opportunity to focus on the economic advantages of having a thriving third sector. As she said in her opening speech, the third sector covers every part of life. Incredible things, from housing provision to mental health support, are going on in the Highlands, an area that we both represent.

I am very aware that debates about the third sector usually focus on the need to support the sector with Government funding. That is important, and I will come to how we are doing that, but it might leave folk with the impression that the third sector is something that costs, rather than being something that contributes. The idea of the sector being something that contributes came through in Paul O’Kane’s contribution, whose past work gives him a valuable insight. I, too, welcome the report from the Royal Society of Edinburgh, which was mentioned by him and other members.

At a time when I genuinely believe that we must, as more people do, think carefully about where we spend our money, and that we must support local and ethical businesses, the societal impact of the third sector cannot be ignored. However, its economic impact is often overlooked.

As Miles Briggs pointed out, the third sector is responsible for an incredible amount of spending. For example, it is hard for me to imagine the Riverside in the west of Inverness being the hive of activity that it is now without Eden Court. One of the best things about having a birthday in July is that, every year, I get to enjoy some of its summer offering. Beyond that, it is estimated that Eden Court is worth £11.83 million to the Highland economy, with £7 being generated for every £1 of public funding.

There is also the spend-to-save element. We know that, in many areas, the efforts of the third sector are about preventing crises, supporting people and saving lives. Last week, I attended the Highland heroes awards to support Michael O’Neill, who is an emergency community rescue first responder in Alness, where I grew up. He rescues people, thereby complementing the work of the Scottish Ambulance Service and community healthcare providers, and he truly deserved the recognition that he got through his award.

It was an incredible experience to hear the stories of the other nominees, who cared for people at home; prevented death by suicide by providing peer support; and found innovative housing solutions. As Kate Forbes and I both know—we probably spend a lot of time reminding other people of this—it is local communities that know best how to deliver services in their area. That gets to the heart of the work that is being done in my portfolio to address depopulation, tackle inequalities and end social isolation and loneliness. We must do that work in such a way that it reaches those who are furthest from power. As Brian Whittle pointed out, third sector organisations are reaching people that others—including mainstream services—have not been able to.

Tonight, we have heard how locally based and locally minded third sector organisations are making a difference across Scotland. They fill gaps and solve problems that businesses that are solely driven by profit cannot. Ruth Maguire’s shout-out to her community larder brought to mind a number of similar facilities that I am familiar with, including organisations that we are supporting through our social isolation and loneliness fund. During the Covid pandemic, countless organisations sprung up to ensure that people did not have to travel far for essentials, even if they lived rurally or on an outer island, and many have since been set up in response to the cost of living crisis.

Ruth Maguire was also right to talk about voluntary services, which make up a huge part of the third sector. In Scotland, formal volunteering is estimated to be worth £2.3 billion, but we know that the true worth is even higher than that. Since I was of a young age, I have always held voluntary roles, even when I have had multiple jobs, not just because I wanted to do something good, but because you get so much out of it. I had the energy to get up in the morning and go to my other work only because I felt that I had a purpose. I got to spend time with other volunteers who shared my beliefs and knew that we were making a difference to someone.

When we look at social prescribing and mental health recovery, we see that the third sector is leading the way by supporting service users and by giving people who will benefit from volunteering the opportunity to be part of something and to enrich their lives by doing so.

As Emma Harper said, such voluntary work is not in opposition to public services, because the partnership working such as that which she described in Dumfries and Galloway can improve the public sector while maintaining an important role for the third sector. That means that the value of the money that we spend on public services goes up, because the impact goes further and is worth more.

In the Scottish Government, we have a firm commitment to our national strategy for economic transformation, which has an overarching vision of a wellbeing economy in Scotland that is fair, green and growing, and in which the third sector has an important role to play.

Foysol Choudhury mentioned the need for many third sector organisations to have dedicated staff to make funding applications. He is absolutely right. I support a number of smaller charities to help them to make sense of the funding landscape and try to navigate it. I always say to them that there is a reason why there are so many full-time fundraising officers. I recognise that there is a need for Government funding to reduce that problem for the organisations that we support and not risk adding to it.

Paul O’Kane was right to mention the fair funding principles, which we remain committed to and have prioritised, despite the difficult budget situation that we are in, in order to provide the clarity that we know that third sector organisations need.

Paul O’Kane

Following on from the fair funding review that I mentioned earlier, two recommendations have been progressed, including a commitment to notify by the end of March organisations that are going to be in receipt of two-year funding as part of the pilot. Can the minister say anything about the progress on that and whether that target will be met?

Emma Roddick

I cannot speak to that in detail right now, but I am more than happy to get Paul O’Kane some more information on that. I know that the First Minister has been keen to ensure that officials across Government know that grant conditions and timescales for notification very much need to be improved. We are aware of that issue, and I am more than happy to follow up on the member’s question.

The national strategy for economic transformation and the 2022-23 programme for government included a commitment to undertake a review of how to increase the number of co-operatives, employee-owned firms and social enterprises in Scotland. That review will conclude in spring this year.

As we approach the two-year anniversary of that strategy’s publication, we recognise that much has changed in that time. A refreshed strategy will provide a clear and concise articulation of the actions that we are taking and will take in order to achieve our central objective of building a fair, green and growing economy.

To fully achieve its economic potential, the third sector needs stability and the opportunity for longer-term planning and development. That is why we remain committed to fully implementing a fairer funding approach for the third sector. This year, we are focusing on improvements to our grant-making arrangements to provide greater clarity.

The Scottish Government is committed to maximising the economic contribution and impact for communities and individuals of the third sector in Scotland. That includes continued collaborative efforts between the public, private and third sectors, and I look forward to playing my part, along with colleagues, to realise that.

There is always more that we can do, and I know that I will continue to hear from many of the colleagues who have contributed this evening on how we can best reach our shared goal.

Meeting closed at 18:32.