The voluntary and community sector (VCS) is a proven and indispensable force in addressing economic inactivity and building an inclusive labour market. By providing essential services and support to those further from the workplace, our sector not only fills critical gaps left by statutory services but also serves as a vital safety net for communities and individuals.
However, ongoing funding uncertainty now threatens this vital provision. While the UK Shared Prosperity Fund (UKSPF) has provided some relief, it falls short in both funding levels and coverage - leading to job losses, reduced services, and increased risks of economic exclusion for vulnerable groups
With UKSPF due to end in March 2026, urgent action is needed to secure a long-term strategy and investment that guarantees continuity of services and support for beneficiaries, reduces economic inactivity, and preserves the expertise and added value developed through VCS-led delivery over generations. Without such action, there is a real risk that this vital legacy will be lost or significantly diminished.
NICVA has played a key role highlighting the significant contribution of the VCS in addressing labour market inclusion. This has included hosting the Building an Inclusive Labour Market conference last June (see report below), and leading the Economic Inactivity Coalition.
The Economic Inactivity Coalition is a collective of VCS organisations that play a vital role in service delivery and are actively engaged in shaping policy to address economic inactivity and promote labour market inclusion. The Coalition advocates for a long-term, strategic approach underpinned by sustained investment, recognising the central role of VCS-led initiatives in tackling these challenges effectively.
The UK Government has stated its intention to devolve future funding for addressing economic inactivity directly to the NI Executive, but that quantum and its scope is currently unknown, with further information not anticipated until after the UK Government Spending Review expected in June 2025. The Department of Finance (DoF) has expressed its intention to lead a co-design process—working in partnership with other key government departments, including Communities, Economy, Health, Education, and Justice—to shape a post-UKSPF programme for Northern Ireland.
NICVA and members of its Economic Inactivity Coalition have proposed a long-term approach with increased investment to tackle economic inactivity and promote labour market inclusion along with stronger collaboration between the UK and NI governments to address these challenges. The key messages paper below proposes:
- Meaningful VCS engagement in programme design
- Sustainable long-term investment and stability
- Addressing structural barriers to employment
- Improved UK-NI Government coordination
We are now at a critical juncture. Decisive action is urgently needed to secure vital services and supports through an agreed programme and sustainable funding for voluntary and community sector–led delivery. We are calling on government to:
• Work closely with the VCS to ensure a smooth transition to a well-designed and resourced successor fund that builds on what works and allows services to continue and evolve without interruption.
• Provide urgent funding clarity and commit to multi-year funding models that enable long-term planning and sustainability.
• Integrate economic inactivity and inclusion strategies, with the VCS at the heart of programme design and delivery.
• Recognise the value of ‘invest to save’ approaches, which reduce long-term demand on public services.
• Maintain low administrative burdens and ensure accessible, streamlined funding processes.
• Restore funding to levels equivalent to previous EU-funded investment ensuring support reaches those most in need.
