Happenings on the Hill – What do I do now my government funding is ending?

Neil Pharaoh May 16, 2024

4 min read

Welcome to Happenings on the Hill – Happenings on the Hill is a regular column specifically for the Third Sector by government engagement expert Neil Pharaoh, Director & Co-Founder of Tanck.

Your government funding is coming to an end, or likely to come to an end, presenting a significant challenge for your organisation. What should you do now?

Many organisations heavily rely on such funding to sustain their operations, implement projects, and serve their communities and sectors. Great organisations with government funding recognise the necessity of investing in time, talent and treasure to manage government as a funder, stakeholder and partner. The best defence to ensure you do not lose government funding is to have a comprehensive and proactive engagement approach.

What happens if you haven’t invested this time, or perhaps left it a little bit late to engage with the government in this area? In this article, we will delve deeper into key strategies and steps that organisations can take when they anticipate a potential end to their government funding.

Assess the Situation

The initial step in preparing for a potential funding gap is to assess the current situation regarding government funding.

Review the terms of your funding agreements and timelines for funding disbursement and any communication or signals from government agencies regarding future funding prospects. Are there opportunities to bring forward funding, delay, or extend? Have you explained the impact of the funding cuts to the contract manager, department and local MP?

Understanding the scope and timeline of the potential funding gap is crucial for effective planning and decision-making. Ensuring you have a number of options and discussion papers is key, as well as a simple clear document that outlines the impact of the funding and any changes.

Diversify Funding Sources

Relying solely on government funding can pose significant risks to the financial sustainability of your organisation. Therefore, it is essential to explore and diversify funding sources. While this isn’t an area of expertise for Tanck and my team specifically, organisations who link corporate, private, philanthropic and government funding and partnerships together strategically tend to be able to withstand the volatility of funding cycles better and are able to secure “multiplier” effects – for instance, matched funding, in doing so.

Look into opportunities for private grants, corporate sponsorships, individual donations, and collaborations with other non-profits or businesses. Diversification not only mitigates financial risks but also strengthens your organisation’s resilience and capacity to adapt to changing funding landscapes.

Strengthen Relationships

Building and maintaining strong relationships with funders, donors, and stakeholders is paramount, particularly during periods of funding uncertainty. Government is a funder and requires as much of an investment to manage, engage, fund and grow as does any other form of funding.

Proactively engage with government officials, attend networking events, and communicate regularly to demonstrate your organisation’s impact and funding needs. Engagement with all five key political stakeholder groups are also critical (for more information have a look back on some of my previous Third Sector articles).

Cultivating transparent and collaborative relationships fosters trust and increases the likelihood of continued support or potential funding extensions. This is critical at both operational, strategic and management levels.

Evaluate Program Impact

Conduct a comprehensive evaluation of programs and projects funded by the government. Highlight the tangible impact, outcomes achieved, and success stories resulting from your organisation’s work. This work should be done throughout the funding cycle, and communicated often – but if approaching a potential cliff, ensure you highlight this in a punchy, short and easily digestible way.

Use data and evidence-based metrics to highlight the effectiveness and relevance of your programs. Demonstrating positive outcomes strengthens your case for ongoing funding.

Develop Contingency Plans

In anticipation of potential funding gaps, develop robust contingency plans. Identify areas for potential cost-cutting measures, prioritise essential programs and services, and explore revenue-generating activities. Establishing clear contingency plans allows your organisation to navigate financial challenges while minimising disruptions to core operations and services.

These plans can also be shared with government or other stakeholders in some circumstances and doing so helps highlight impact.

Engage in Advocacy

Advocacy plays a crucial role in advocating for continued government support and raising awareness of your organisation’s impact. You should have been involved in advocacy for your cause, or funding from before you have even won a government contract, and it is never too early to start.

Engage in advocacy efforts to articulate the societal benefits of your work, address critical issues, and align with government objectives – it helps build your profile, and assist in mitigating changes to circumstances.

Collaborate with stakeholders, leverage media opportunities, and mobilise community support to amplify your advocacy efforts and influence policy decisions.

Stay Agile, Adaptive and Positive

In a dynamic funding environment, agility and adaptability are key attributes for organisational success. Stay informed about funding trends, policy changes, and emerging opportunities.

Remain flexible in your strategies, be open to exploring new initiatives, and adjust organisational priorities based on evolving circumstances. Embracing a culture of agility enables your organisation to respond effectively to funding challenges and seize new opportunities for growth and impact.

Embracing proactive and forward-thinking strategies empowers organisations to thrive and make a lasting difference.

My final reflection is the importance of staying positive, for your team, funders, supporters and beyond. Currently, some State & Territory governments in Australia are operating in almost “bankrupt” type conditions, meaning even “perfect” programs, which save money, benefit the community substantially, and are non-partisan are still being cut due to massive government deficits.

Neil Pharaoh

Neil Pharaoh has spent most of his voluntary and professional life in and around social purpose organisations, government, public policy, and advocacy. Neil has been behind many leading social policy and advocacy campaigns on gender rights, equality, medical research, and education, and ran for Parliament in Victoria in 2014 and 2018. Neil is co-founder and director of Tanck, which focuses on better engagement with government, and regularly runs workshops and advocacy sessions and advises leading social purpose organisations on their government engagement strategy and systems.