What action is being taken to encourage sustainable public sector funding practices in relation to the voluntary sector.

The Scottish Executive recognises the need for long term, sustainable funding for voluntary organisations. To assist in this the Executive, as part of its review of its own direct funding of the voluntary sector, has committed itself to the provision of three-year funding packages where appropriate and three-year finance to local authorities, which should in turn enable them to offer three-year funding to voluntary organisations.The Executive has also recognised the need to develop new types of funding and has established Social Investment Scotland. In September 2001, the Executive, in partnership with Scotland's four clearing banks, Scottish Enterprise, Highlands and Islands Enterprise and Scottish Homes, launched the £5 million investment fund to support the development of the social economy. The fund will provide development advice and loan funding for social enterprises unable to access loan finance from traditional sources.Following on from its review of direct funding, the Executive is committed to conducting a strategic review of funding for the voluntary sector that will look at how public funding meets the needs of the sector. This review will consider whether it is possible for all funders of the sector to work together to ensure that they are operating in a way that meets their own needs and those of the sector. This review is due to commence in the summer, and discussions on how best to take work forward are taking place with SCVO and COSLA.In addition, the Executive is continuing to implement the Scottish Compact and Good Practice Guides, which include advice on best practice in funding of voluntary organisations.