The Social Investment Business, on behalf of the Cabinet Office, awarded the Society Network Foundation a grant of £299,800 in April 2012, for the Get In project designed to recruit volunteers for programmes to reduce childhood obesity.
After handing out the first tranche of the funding - £101,200- in April 2012, the Cabinet Office concluded by August that the foundation wasn’t making enough progress on the project and that “its revised objectives lacked substance.”
Even though the second part of the grant was planned to only be handed out “if the project had made satisfactory progress and could demonstrate satisfactory evidence of spend”, the report says, the Cabinet Office paid out another £98,700 to the Society Network Foundation in October 2012.
When making the second payment the Cabinet Office failed to take into account a surplus of £60,800 the foundation had on its Get In project accounts and “paid over the amount that it would have disbursed had the project met its objectives”, the NAO report says.
Two months later – in December 2012 – the Cabinet Office decided to withdraw its funding from the project altogether because of the project’s poor performance and after deeming its revised objectives “unacceptable” and withheld the remainder of the grant - £99,900.
The funding cancellation came after the Cabinet Office itself intervened directly and repeatedly to have eligibility requirements widened and adjusted in order to enable the Society Network Foundation to bid.
The Social Investment Business – an organisation subcontracted by the Cabinet Office to administer the Get In funding - proposed rejecting the Society Network Foundation’s initial bid, because it didn’t meet two eligibility requirements - it was less than two years old, and had not submitted accounts with its bid.
The Cabinet Office then expanded the eligibility requirements after the February 2012 closing date so that any organisation without two years of audited accounts but whose senior leaders had two years’ relevant operational experience could be considered. It said that it did so “to ensure a good range of projects was presented and because a number of those [projects] initially sifted as rejects appeared to be of interest and possibly in line with the programme criteria”.
Despite the amended criteria, the programme’s advisory panel still rejected the Society Network Foundation’s bid because it did not meet a number of other requirements for the grant.
However, the Cabinet Office believed that the Society Network Foundation’s bid “had some merit”, the report says, and asked the foundation to submit a joint application with the British Sports Trust, which was responsible for a similar programme addressing childhood obesity.
The new joint bid was submitted on 20 March 2012, after the original programme deadline had passed, and approved by the Cabinet Office six days later on 26 March 2012.
Although the British Sports Trust was identified as the lead partner, “supported by the Society Network Foundation” during the bidding process, the Cabinet Office handed out the cash to the two organisations separately without establishing a lead organisation for the administration of the grant, thus breaking its own guidance: it decided in April 2012 to give £900,000 to the British Sports Trust and £299,800 to the foundation.
The report states that, “by treating the two bids as joint for the purposes of bid approval but as separate bids once the grants were allocated, the Cabinet Office gave funding to the Society Network Foundation even though the organisation did not meet the Cabinet Office’s stated criteria for funding.”