Last Monday I wrote about finding terms that describe the third sector. It’s tempting to describe the sector by what it is not; it is not private or public. This is not very satisfactory but this is the way we categorise public life in this country.
People define the Third Sector by comparison with the Public (or Statutory) sector, funded through taxes (mainly) and governed through elected political leaders who employ officers to do the work, and the private sector, funded through trade (mainly) and governed through ownership. There are complications but this will do for now.
So, the Third Sector represents various alternatives that fall between the other two sectors. I suggest three sub-sectors. What they have in common is they welcome voluntary work. So, if taxes define the public sector and trade defines the private, perhaps volunteering defines the third sector.
Professional Voluntary Sector
Large organisations, often with a national profile. They usually have a steady income stream (from donations) and employ paid staff. Organisations like this include:
- Trusts who make donations but don’t employ staff.
- Large organisations who provide expertise through their staff. Many ask volunteers to deliver services, supervised by paid staff.
- Churches and other religious bodies, can resemble large voluntary sector organisations in their national or regional offices.
- Various loose federations of local groups, providing training and support.
Community Sector
Informal organisations who champion a particular neighbourhood or issue.
- Community groups, neighbourhood groups and forums. These usually start out as a group of residents who meet around some local issue. If they raise funds, usually grants from the statutory or professional voluntary sector, they employ staff. This is usually small-scale and temporary. Sustainability is a major issue for these groups.
- Action or interest groups form around issues and often have a city-wide and not a neighbourhood perspective. They might form around an issue or a group of people disadvantaged because of who they are. Funding can be difficult when they are seen as political. They can be effective raising awareness and gaining political support.
Not-for-profit sector
These fall between the third and private sectors. They earn income through trade although many are grant aided.
- Community organisations that trade. Sometimes they are micro-trading, ie subsidised by grants or loans. Sometimes their main income is from at least one large contract.
- Mutuals, sometimes called co-operatives, can be an alternative business model for trading organisations. They include organisations that provide financial services, eg credit unions or (not so much in the UK) micro-credit. Retail co-ops are often counted as third sector because their members share ownership.
- Alternative currencies, eg Local Economic Trading Systems (LETS). There are examples online as well as real life schemes. The real life schemes operate locally. Online schemes have a global reach and some can be converted to established currencies. I know very little about online schemes and so cannot recommend them.
If we’re to understand our neighbourhoods and their economics, we need to understand the organisations that operate in them. In future posts I shall share more details about each type of organisation.
I’m sure I’ve missed some types of organisation. Be the first to point out my errors. What have I missed?
