Resetting the relationship: the UK’s new Civil Society Covenant

The big picture

Civil society in the UK finds itself at a critical juncture – as do its counterparts across Europe and beyond. Comprising charities, faith groups, social enterprises, foundations, social investors and more, civil society is an essential part of the nation’s fabric. Yet an era of ‘permacrisis’ has left the sector under immense strain, just as demand for its support has never been higher.

Instead of working in genuine partnership to tackle our most deep-rooted challenges, successive governments have squandered this vital relationship. A previous agreement between the sector and UK Government – known as the Compact – was last renewed in 2010 and ran its course.

Civil society has too often been left with short-term, insufficient contracts and grants, no real seat at the table – and, at worst, outright hostility from those in power.

A new way forward

The Civil Society Covenant could change this.

The arrival of a new national government has brought with it a rare opportunity: to reimagine how the government and civil society work together, moving beyond a narrow, transactional approach to one rooted in shared purpose.

As the UK’s Prime Minister – Sir Keir Starmer – has stated, the Covenant represents “a new way forward – where government and civil society work side by side to deliver real change.”

Co-designed by government and the sector, this new model of partnership is based on four key principles:

• Recognition and value
• Partnership and collaboration
• Participation and inclusion
• Transparency and data

These principles could help create the conditions for deeper collaboration, while protecting and valuing the independence of civil society.

Stretched thin

Charitable foundations occupy a distinct position as both civil society actors and major funders of it. While they have increasingly played a key role in keeping the sector afloat, they recognise the limits of what philanthropy alone can achieve. Foundations want to see an enabling environment for the organisations and communities they support to thrive – and the Covenant promises just that.

Still, we need to be clear about what the new Covenant does and doesn’t offer. It comes with no additional funding and won’t magically solve the sector’s financial challenges overnight. Moreover, the funding pressures on charities could make it much harder for them to fully engage in partnership.

But what is encouraging is that the Covenant recognises this reality: sustainable partnerships need adequate, long-term funding if they’re going to tackle the deep-rooted issues that communities face. Beyond the Covenant, the UK Government is showing increased interest in partnering with the full spectrum of capital, from philanthropy to social impact investing, where foundations are essential.

It’s not just about finding new money – government must also ensure it doesn’t unintentionally weaken the sector’s financial health, like recent increases to employer taxes that have hit UK charities hard. If civil society remains an afterthought, the Covenant’s promise risks being hollowed out before it can deliver real change.

Beyond funding

Foundations do far more than provide funding. As integral parts of civil society, they bring decades of expertise, convene key stakeholders, and speak up in line with their charitable missions. They also lend their support to policy and advocacy efforts across a wide range of pressing social issues.

For this reset to succeed, the government must treat civil society (including foundations) as equal partners in shaping policy and funding decisions.

We will be watching out for progress signs, including:

• Civil society can see that their expertise has been listened to in the course of policy and service design
• Even in the face of disagreements, partnership working can continue with mutual respect

A starting point

This is the start of a new chapter. A stronger partnership between civil society, philanthropy and government is vital if the UK is to meet the major challenges of our time, at home and overseas. The Covenant provides a clear roadmap for making that happen.

We welcome the formal mechanisms, including the Joint Council, now being put in place to oversee its delivery. This must be matched by a cross-government commitment: at every level – national, regional and local – these principles must be upheld and put into practice.

Will the Covenant truly reset the relationship for good? Could it serve as a model for other countries, particularly where civic space is under threat? Only time will tell. But it’s a promising first step: warm words matter, and the intent is clear. The real test now is whether that intent can be turned into bold, meaningful action.