Chris Buchan, lead for Welsh Government’s Third Sector Policy and Support team, outlines the steps being taken to ensure the updated funding code of practice is being used across Welsh Government.
In April, Cabinet Secretary for Social Justice, Jane Hutt MS, formally launched the revised Code of Practice for Funding the Third Sector. The revised Code was endorsed by the Cabinet. The 2025 edition of the Code focuses on five key principles of good grant-making:
- Early and continuous dialogue – Ensuring meaningful and regular engagement between funders and third/voluntary sector bodies.
- Flexibility – Ensuring that if evidence or circumstances support the need, both funder and funded organisations can suggest adjustments for joint agreement.
- Equity – Ensuring fairness of access for all – creating a funding environment that is proportionate, removes barriers to inclusion and builds support.
- Valuing and outcomes – Ensuring we are basing our funding decisions on a broad consideration of social, environmental and economic value and outcomes.
- Appropriate funding mechanisms – Ensuring funders consider all options and choose the appropriate mechanism(s) that will effectively deliver agreed outcomes throughout the funding period.
The revised Code was two years in the making, but the launch really marked the beginning of the work with partners to continue to raise awareness and facilitate the behavioural change necessary to create a better funding environment.
TAKING ACTION
On the Welsh Government side, this means working with policy officials and grant managers across Welsh Government, as well as our senior managers, to influence how funding is administered.
Working with policy officials and grant managers we hope to influence behavioural change from the bottom up. We also hope that this will have a knock-on effect across the public sector as public sector funding often starts with us. We recognise this will be a long-term process, but it has already begun:
- The Cabinet Secretary for Finance and Welsh Language, and the full Cabinet recently recommitted to longer term funding agreements where this is appropriate.
- The Welsh Government’s Grants Centre of Excellence has carried out awareness sessions to inform funding officials of the policy on longer term funding and advise how it can best be implemented. Over 200 people attended these sessions.
- Welsh Government’s Permanent Secretary, Dr Andrew Goodall has agreed to be a champion for the Code across the public sector. Andrew is our most senior official, and can influence from the top down. This means we are working from both directions to raise awareness and facilitate the behavioural change we need.
- The Code is referenced in the Welsh Government’s Minimum Standards for Grants. This document is used by all Welsh Government grant managers.
- It is also a consideration for policy officials developing new grant programmes as part of Welsh Government’s grant assurance process.
In the short-term future, we will be delivering further awareness sessions for Welsh Government officials during September, considering each aspect of the Code. The first topic, one we get lots of interest in, is full cost recovery.
WHAT CAN THE VOLUNTARY SECTOR DO?
The voluntary sector has an important role to play in raising awareness of the Code with public sector stakeholders (especially health boards and local authorities) and in providing the Funding and Compliance Sub-committee with examples of both good and bad practice.
We can use good practice examples to show the importance of following the Code’s principles, the positive impact it can have on both organisations and their beneficiaries, thereby helping Welsh Government to achieve its aims.
We have already received some examples where funding from Welsh Government has not met expectations. Working with individual teams we can seek to improve practice for the future and resolve issues in the present. It is also important for us to hear about those good examples, we can use these to highlight the benefits of using the Code.
GET IN TOUCH
To share good or bad examples of Welsh Government grant making based on the principles and guidance provided in the Code you can contact us in the Third Sector Policy and Support team directly at thirdsectorenquiries@wales.gov. You can also get in touch through the WCVA team (including if you want to share an example anonymously) at funding@wcva.cymru.
This is the start of what we hope will be a process with very positive results.