It’s shocking, isn’t it?

A supposedly humanitarian endeavour sucks up vast quantities of public money, pursuing unrealistic goals and without ever having the effectiveness of its methods properly evaluated.  Unbelievably, cash is simply handed out to vulnerable individuals without any attempt to monitor what it’s used for.

The organisation keeps growing beyond the ability of its senior staff to manage it properly or bring its finances under control. However, thanks to the high profile public support of politicians, celebrities and the media – the circus carries on, until, finally, the government of the day is forced to act.

But enough about the British welfare state, let’s talk about Kids Company.

In a thought-provoking piece for Cap X, Steve Moore considers the lessons to be learned. It could be said that there aren’t any – at least none that can be applied more widely – because Kids Company is one of a kind (as is its founder and leading light, Camila Batmanghelidgh):

“Kids Company was always an outlier and Camila was always an iconoclast. She should never have been running a multi-million pound charity but it could never have become one without her singular dedication.”

However, Moore goes on to argue that the way which Government provides support  to charities – in particular through the Office for Civil Society in the Cabinet Office – is misconceived:

“With no tradition of grant making within the Cabinet Office, and little evidence of any real core capability to manage such processes, this new direct grant funding of charities can only be seen as something of an oddity. Myriad services, such as student mentoring, anti-bullying websites, community sports events, all delivered by a variety of charities and community groups, came to be funded.”

As well as questioning the capabilities of the Cabinet Office in this endeavour, Moore believes that it isn’t something that the department should be doing anyway:

“…it is preposterous to have a dedicated department making grant payments to individual charities delivering services that cut right across the work of other government departments.”

The trouble is that enabling charities and social enterprises to play a bigger role in tackling social challenges is a job of reform that the incumbent state monopolies can’t be trusted with. On this and other issues, Whitehall heads need banging together and the Cabinet Office has become the default location to do it from.

Of course, it’s not just a matter of removing bureaucratic obstacles within the public sector. We also need to build up the capacity of the voluntary sector – just as government provides advice and other kinds of support to private sector companies to help them expand.

In this respect, it is entirely right that government should take risks – especially with the most innovative and groundbreaking voluntary organisations. In any process of research and development, you need to try and fail many times before hitting upon success.

Let’s not forget that by far the biggest source of failure in social policy is the welfare state itself, which has wasted billions on programmes that have not delivered the real progress that we so desperately need. Instead of expecting the state alone to find new and better ways of meeting social needs, we should open up at least part of this funding to the diversity and creativity of the voluntary sector.

Whether the Cabinet Office is the right place to manage the funding of social innovation is a separate question and a debate worth having. For instance, Steve Moore argues that it is politically too close to the hurly-burly of Downing Street.

Perhaps there’s a case for combining the Office for Civil Society with the universities and science functions of the business department (DBIS) and the whole of the Department of Culture, Media and Sport (DCMS). That way there’d be a reasonably-sized department, under a dedicated Secretary of State, and within which government expertise in grant giving could be pooled: a one stop shop for public investment in the brilliance of others.