Conflict with a funder: the Kaleidoscope experience

Kaleidoscope is a long-established community project in Kingston, Surrey, with 40 staff and 25 volunteers and an annual income of £1 million. They have a large drug dependency unit, which dispenses methadone to 300 clients daily.

The project received its funding direct from central government until local authority contracting was introduced. This caused problems. Adele Blakebrough, the then director, explains: 'Even though we felt that we were offering a better, cheaper and much more flexible service to clients than similar health service projects, the health authorities had no real interest in contracting with us. They were in effect buying services from themselves.'

After Kaleidoscope's initial lobbying of their local MP, a local health authority consortium was formed to contract with Kaleidoscope. However, one of the authorities refused to comply with the contract and withheld funds. 'The health authority wanted us to transfer 80 of our patients back to their own services,' says Adele, 'but the clients didn't want to go, and we didn't want to send them against their will.' The conflict escalated when the authority demanded that Kaleidoscope should transfer ten patients a week rather than ten a month as originally requested.

This triggered the conflict. 'We dug our heels in and decided to fight. We lobbied our local MP and local councillors, explaining that we were in conflict with the health authority and why. Clients also helped by writing personal letters. We held public meetings and managed to get press coverage.' All in all the conflict lasted for two years. The health authority owed Kaleidoscope over £150,000, which put a severe strain on the organisation. Some services were cut. But the management committee and staff were both behind the decision to fight, and the health authority eventually honoured its contract.

Adele advises organisations to cultivate support that can be drawn on in times of conflict. 'Make sure that your community, funders, local politicians and councillors understand who you are and what you are doing. Otherwise why will they care if your organisation is in trouble? Can you prove your effectiveness? Try to engender greater understanding and commitment by holding open days. Consider forming a 'Friends of' support group for your organisation, which you can draw on in time of difficulty.

'If you do get into trouble, make sure you have a straightforward message. Our campaign was very simple - we were being treated unfairly by the health authority. It's also important to tell people how they can support you, for example by writing letters. More generally, never rely on one source of funding and always think about a contingency plan.'