CONTRACT v GRANT

Question

I have a problem with one grant we pay which is about £20k per year.   What are the criteria when deciding whether to fund something via  a contract or a grant ?

Answer 1

I would argue that a grant is a discretionary payment i.e. the recipient body has no guarantee that it will be paid and each year (or whatever period) they should apply in accordance with your grant policy, their application will then need to be discussed and agreed or otherwise.  A grant is not a payment made in exchange for something other than some community benefit.
A contract implies the provision of some kind of benefit for the payment, for example for goods or services.  Normal procurement rules would apply (seeking alternative quotes for example) although it would be possible to agree a contract for more than a year in some circumstances.

Answer 2

A contract is initiated by the donor, whereas a grant is initiated by the recipient. In other words, the council says "We need somebody to do this for us" and awards a contract to the successful bidder, or an organisation says "We would like to do this, but need financial support" and the council gives them a grant to enable them to do it.