In the 1980s, the Thatcher governments increased funding for nongovernmental organizations (NGOs) in Northern Ireland. This was partly a consequence of neoliberal policies that subcontracted public services to private bodies; as a result, NGOs became more firmly incorporated into the welfare state. However, increased entanglements of NGOs and state did not create passive state subjects. Instead, NGO activity remained rooted in local communities, animated by a common ethic of welfare as entitlement and changing nationalist and loyalist orientations to the state. When the government attempted to redirect NGO funding, cross-community opposition emerged, despite long-standing political polarization between nationalists and loyalists. This article describes how NGOs were driven by a local ethic and how their alliance successfully framed state subsidy as social justice. This example supports a broader argument that NGO practices are not neatly determined by a logic of global, universal neoliberalism but are profoundly shaped by local ethical regimes.