VOLUNTARY ORGANISATIONS

HC Deb 08 July 1975 vol 895 cc345-405

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Pendry.]

4.1 p.m.

Mr. Norman Fowler (Sutton Coldfield)

In opening this debate on the plight of voluntary organisations, I am conscious that there is in the House a great fund of knowledge of voluntary organisations. Some, like my hon. Friend the Member for Liverpool, Wavertree (Mr. Steen), have taken a leading part in forming new organisations such as the Young Volunteer Force Foundation. Many are heavily involved in the running of voluntary organisations and—dare I say it?—there are even some who not only help to run voluntary organisations but walk 17 miles for charity at weekends. I can think of two Members of the House who took part in that activity during last weekend, and I pay tribute to them.

The immediate cause of this debate is the financial crisis which faces many voluntary organisations, but the debate raises wider issues, including the place of voluntary organisations in this country and the place of the volunteer. There are some who claim that with the growth of Government and local government social services provision the need for voluntary organisations will become less and less. I fundamentally disagree with that argument. We do not need a great deal of skill with a crystal ball to forecast that our statutory social services will be under intense pressure over the next few years. It would be well for the House to appreciate that cash limits will result not in a reduced rate of expansion but no expansion and, indeed, possibly in reductions in local government and central Government staff.

The case for voluntary organisations goes way beyond their rôle in filling gaps. Even if this were a period of economic prosperity, I would still argue the fundamental case for voluntary organisations because in an age of centralised organisa- tions and spawning bureaucracy the effort and inspiration of the volunteer are needed even more.

We in this country are extremely fortunate in the range of voluntary organisations that we have. There are the big voluntary organisations which work in partnership with central Government and local government—organisations like the WRVS, the NSPCC and the Red Cross. There are the voluntary organsations which provide services which Government or local government largely fail to provide. The community law centres are a good example. There are voluntary organisations which have risked money and staff in promoting new objectives—for example, the National Council for One-Parent Families—organisations which have pioneered new and important work. There are voluntary organisations which have responded with a flexibility that is often their characteristic to new needs which appear in society—organisations like CHAR, the Campaign for the Homeless and Rootless.

In the social services sector the contribution of voluntary organisations is immense. They provide services to care for the mentally ill and the mentally handicapped and campaign to make the Government and the public more aware of the problems that society faces. They look after children in care, they defend children's interests in court and seek to protect them against cruelty and ill-treatment. They help to campaign for the disabled, the deaf and the old. Taken by itself, the contribution made by voluntary organisations in the social services sector is immense.

Of course, the contribution of voluntary organisations goes way beyond social services. They enter into the difficult areas of race relations—in which I know the Minister of State takes such a close interest—employment and the environment.

The volunteers span the age range. The volunteer spirit is not confined to one age group. The established voluntary organisations work side by side with the new and young organisations such as the Community Service Volunteers and the Young Volunteer Force Foundation. It is an impressive partnership which provides a whole range of services on which the country relies. But voluntary service is now under threat.

Inflation has pushed up the cost of heating, lighting, postage, telephones food and staff, although it is fair to and that many who work for voluntary organisations do so for well below what they could earn in other jobs. As costs have gone up, the real income of many organisations has been reduced. The public, who are also battling against inflation, find it more difficult to give. Donations from commerce and industry have been reduced, and income from the big trusts has been eroded by the slip in the value of shares. The public should clearly understand that many voluntary organisations now face a crisis.

I will give some examples. One common effect is that many voluntary societies are cutting back on staff or not filling vacancies which occur. An area of concern to all of us in the House is cruelty to and ill-treatment of children. Ill-treatment in several tragic cases has led to the death of a child. On each occasion when such a tragedy is revealed, society is appalled, and rightly so, for what price can one put on a child's life? Let us also remember that children who have been grossly ill-treated but have survived will sometimes bear the emotional scars for the rest of their lives. As Dr. Kelmer Pringle pointed out, had Maria Colwell lived the effects of her all-treatment could not simply have been washed away.

I say that to emphasise how tragic it is that, at a time when public concern is running so strong, the NSPCC is being forced to cut back on its staff on the ground. Once it had 260 inspectors, but that number has now been reduced to 220, and I am informed that it could go even lower. That means in practical terms that the number of NSPCC local offices will be reduced. At present the NSPCC fulfils what all hon. Members on both sides of the House agree is a vital rôle. The organisation is a natural centre for reports of child ill-treatment, a centre to which some undoubtedly prefer to go rather than to the police or the local authority. The result of the economic crisis that faces this society, like so many others, is that that coverage will be reduced.

Let us take the example of the Spastics Society. In the current year it will suffer a loss of £200,000. Next year it has budgeted for a loss of £500,000. In part this budgeted loss is due to inflation, pure and simple, driving up costs, but in part it is a realisation that inflation is driving up building costs at such a rate that if the society does not build now it is never likely to build at all. Therefore, the society is budgeting next year for development. But in the year after that it is very unlikely that much development will take place. This will mean that there will be no building of day centres for severely handicapped children and hostels for children who might otherwise have to be housed in the big subnormality hospitals. That is another effect of the crisis.

In yet other cases the financial crisis has led to doubts about the future of the voluntary organisations themselves. I think that the Minister of State, Home Office, will confirm that this is affecting, in particular, voluntary societies working in unpopular and unfashionable areas such as drug abuse or rehabilitation of ex-prisoners. They are working in areas where progress in raising money has never been easy, where often there are enormous gaps in local authority provision and where often there is—let us face it—little public pressure to improve the position. If these voluntary organisations go under, it is difficult to see where the substitute effort will come from.

Only this morning I received from the National Council for Social Service a list of 25 societies which are in financial difficulties. Of course, this is by no means a complete or definitive list of the total number of societies which are currently affected by inflation. The list includes the NSPCC. The Helping Hand Organisation is also referred to. That organisation runs 12 hostels for drug addicts and alcoholics. Its chairman has reported a lay-off of 50 per cent. of the staff. The list includes the Joint Council for Welfare of Immigrants. That organisation has had no paid secretary for the last six months because of lack of money. The London Council of Social Service is also mentioned. That organisation has not filled four vacant posts. The list also includes the National Council of Social Service, which has taken the decision not to fill vacancies for three months and then to consider whether to fill them in the next six months after that.

Other organisations are facing difficulties as well. The list that I have been supplied with includes Shelter, the National Council of Civil Liberties, the Multiple Sclerosis Society, the Standing Conference on Drug Abuse and the Council for Children's Welfare. I quote these examples so that we shall not just generalise about the problems that face voluntary organisations. The problems are very real and very urgent. However, the list gives some idea of the range of organisations which are at present in serious trouble.

Clearly, the only long-term solution will come with a reduction in the rate of inflation. As my hon. Friends and I have pointed out month after month in social service debates, the overwhelming problem that the country faces is inflation. Bearing in mind that view, I do not think it would be consistent for the Opposition to press for a massive increase in public expenditure, and I should like to underline that fact. The hon. Member for Sheffield, Heeley (Mr. Hooley) is laughing. It is because I believe that the inflation that this country is suffering is indeed the major problem that I have said that I am not pressing the Government to spend more and more in terms of public expenditure. Surely the nation expects that kind of consistency from the Opposition, and, indeed from the Government. We have yet to see the Government's hand on this matter.

I should certainly hope that Government expenditure and, indeed, local authority expenditure, will be maintained. I say quite frankly that I think it unrealistic to believe that Government expenditure or local authority expenditure will be increased in real terms. However, I am bound to say that I do not think the Government can get off the hook as easily as that. The major part of the crisis faced by voluntary organisations results from the inflation which, until the last few days, the Government have shown no signs of combating. We shall obviously wait to hear their plans. But, irrespective of the Government's economic strategy, there is certainly one area where they can already act. They can at least avoid, by their actions, damaging the interests of voluntary organisations, which it should be their duty to protect.

It was one of the rôles of the Voluntary Services Unit set up by the last Conservative Government—I am sure that the Government Front Bench will agree with this; Lord Windlesham is particularly associated with it—to maintain coordination between Government Departments. It is certainly true that the unit had money to spend, but then, as now, the main part of funds for voluntary organisations came directly from Government Departments, like the Department of Health and Social Security and the Department of Employment. Its main task was to co-ordinate volunteers with the opportunities available for voluntary effort and to co-ordinate Government effort itself. In the words of Lord Harris in another place, the aim was to ensure that: departmental policies do not disregard the voluntary sector".—[Official Report, House of Lords, 25th June 1975; Vol. 361, c. 1415.] Unhappily, it is the complaint of voluntary organisations that all too often Government policy, apparently by oversight, hits at the voluntary organisations that it should be supporting. One example is value added tax. As the Minister knows, it has long been a claim of the voluntary organisations that they should be completely zero rated. This is not the time to raise that subject again, hut I hope that the Government will be able to tell us what the cost of that is, because I have always found it difficult to extract that figure from Government Ministers.

While I am dealing with this point, I wonder whether, when the Chancellor of the Exchequer raised VAT to the new luxury rate of 25 per cent. on television sets and radios, he considered the interests of charities. Did he realise that there is a long-established charity called the Wireless for the Bed-ridden, which provides television sets and radio sets for old people? Did he realise that, in addition to this national organisation, there are many local organisations which do a similar job, providing televisions and radios for the elderly and disabled? There is no doubt about the value of their work, although I notice that Government Ministers seem to be slightly sceptical on the subject. Maybe the Home Office knows better. However, the Chancellor's policy means that such work will have to be curtailed. The charities are paying a luxury rate of VAT for seeking to help those who are in need.

Let us take as another example the Community Land Bill. Many hon. Members, on both sides of the House, will have received representations about the Bill As drafted, its effect will be to penalise those charities which own land or buildings. Yet it is often only by selling land which is adjacent to buildings, thus realising the development value, that organisations can afford to modernise their premises, or perhaps by selling the old headquarters building in London they can use the proceeds to pay for new premises outside. Those of us who have worked in the social services will know of a number of organisations that have done that. We now hope for a concession from the Government on this, and we wait with interest to find out what it will be.

Even if a concession is finally wrung from the Government, like the concession on capital transfer tax, it is at a price. The price paid by the voluntary organisations is the cost to them not only of employing expensive legal counsel but of the man hours devoted to fighting for that change. It is here that the Government can directly help the voluntary organisations. If the effects of Government policy were better thought through in relation to the voluntary organisations the financial saving to these organisations would be immense. That is a saving which could be effected for the benefit of the voluntary organisations without any public expenditure being involved. It would simply involve better co-ordination within the Government.

There is one further aspect of Government policy with which I would like to deal. I refer to the Common Market Social Fund. This is available for providing help in some areas covered by the social services, although by no means all areas. It includes help for the training and rehabilitation of mentally and physically disabled people. I raised this question when we debated the mobility allowances. I asked what approaches had been made to the fund for finance. At that stage the Minister did not reply.

Perhaps the Minister was still labouring under the Secretary of State's policy as explained to the Select Committee on Violence in Marriage, which was to the effect that, while Britain's future in Europe was still in doubt, the Department did not intend to go out of its way to publicise the fund. We can agree that Britain's future in Europe is in doubt no longer. I hope that the Minister will say exactly what funds his Department receives.

There is a bigger and more fundamental question here, and that is the Government's overall policy in this respect. This has been questioned, notably by the Sunday Times. In essence, it seems to be that the Treasury and the other Government Departments are not treating social fund allocations as extra money to be passed on to the bodies concerned. Instead they are treating the money as reimbursement to the British Treasury. The charities are not getting direct additional help from the European fund. All that is happening is that the Government are reimbursing themselves for any money they have paid to individual organisations. Only today I received confirmation from the National Association of Youth Clubs. It runs a project called Community Industry which provides employment opportunities in areas of high unemployment. Currently it is providing 2,000 jobs. Even now the association would like to expand the number of jobs available. Clearly, at a time of high unemployment with little prospect of its falling but every chance of its increasing, there could hardly be a more relevant aim for a voluntary organisation.

Application was made, as I understand it, by the Department of Employment to the European Social Fund on behalf of the association. A total of £600,000 was made available. The Department of Employment has taken the whole of that for itself. This is clearly a policy which we shall want to explore much more deeply. At this stage I simply ask the Government to confirm that this is a policy being pursued by them. Whatever view we take, we need to be clear about what the Government are seeking to do. Assuming that this is correct and this is the declared policy of the Government, may I ask the Minister to state clearly what criteria are being used?

Many people will see this as a way of depriving voluntary organisations of much-needed resources at a time when they are unable to obtain resources from elsewhere. This is fundamentally a serious question. I hope that the Government will be absolutely frank about the implications of their policy. I give a warning that this is certainly a matter to which we shall want to return.

This debate will have served a valuable purpose if it tells the public of the crisis facing voluntary organisations and of their desperate need for funds. We can argue at length about what is a charity. We can argue about greater efficiency, although I am bound to say that there are few organisations which are more cost-effective than the voluntary organisations. Whatever is the outcome of our longterm debate, the fact is that the problem is now and the crisis is immediate.

That crisis has consequences for us all. For the Government it must mean that at the least they do not make the job of voluntary organisations more difficult. For local authorities it must mean that they should co-operate with local voluntary organisations rather than put bureaucratic obstacles in the way of fundraising. For industry and trade unions it means that there must be generosity. Here let me mention the PEP report on voluntary service in society, published recently, which says that it hoped that trade unions would become more and more involved in the work of voluntary bodies and in the advocacy of voluntary service. That is certainly an aim that I share. There is a clear lesson for us all as members of the public. It is that we should give as generously as we can afford.

The encouragement of spontaneous but relevant personal service should be a major national objective. President Kennedy once said: Ask not what your country can do for you—ask what you can do for your country. Thousands of people in Britain are putting into practical effect that high ideal by working unstintingly for the voluntary organisations. They deserve our support.

4.26 p.m.

The Minister of State Department of Health and Social Security (Dr. David Owen)

The whole House is united in its commitment to the value of voluntary effort and to the spirit of voluntarism that exists in society. It is appropriate that at this time of great economic difficulty the House should debate a subject which is not primarily about legislation but about a spirit that exists in society. At times we are too reluctant to talk about the values in society. There is not sufficient talk of altruism, the rôle of Governments and the position of Parliament in fostering and nourishing the spirit of altruism that exists in society.

We should not be afraid of putting it into the centre of our policy making. It is the cement for a good deal of our social policy. It is in that spirit that we should conduct this debate. Much has been done. It is easy to forget how small were the resources given by Governments to voluntary organisations even such a short time ago as the late 1960s. In December 1971 the then Prime Minister said that direct grants to voluntary services from Whitehall were estimated at £2½ million. He said that it was hoped to double that figure by 1975–76. Allowing for inflation, that proposed £5 million would now be £7½ million. Actual expenditure by the Government on voluntary services in 1974–75 was more than £16 million, and the estimated expenditure for 1975–76 is currently about £20 million.

It would be wrong to use these figures as exact comparisons because there is no exact definition of voluntary services and the bases of calculation may have differed over the years. However much they have differed, there can be no doubt that the Government's contribution to the voluntary services has increased extremely rapidly in the past few years. We face problems in the future.

The hon. Member for Sutton Coldfield (Mr. Fowler) was right to indicate the limitations that will come with the controls on cash limits. The rôle of the Government in support of voluntary organisations is, first, to do nothing to damage their independence. They are often important critics of the Government. We should not get into the situation where, because of inflation and the financial situation, they have to come to the Government for grants and thus feel in any way inhibited in criticising the Government.

The rôle of the paymaster is slightly dangerous when it extends to a large proportion of any one budget. Many voluntary organisations are worried about that aspect. In times of inflation, they must devote more attention to fund raising and to inspiring the voluntary efforts to attract more money. The voluntary effort can often be used to raise money. However, in many cases it is most useful in providing the services by contributing the skills and scarce resources of manpower and womenpower.

On the question of altruism, the 1973 family expenditure survey showed that only 35.8 per cent. of the 19 million householders in the United Kingdom made contributions to charity. If that could be raised to 50 per cent., with the same average contribution, the incomes of charities, which are voluntary organisations, would be increased by £20 million a year, even though half of the households in the United Kingdom made no financial contribution.

Perhaps we should look at the question of fostering the spirit of altruism. I remember a lecture given by Michael Young in which he attached importance to having a box on tax forms in which we could say what percentage of our income was being contributed to voluntary organisations. We have not paid attention to those elements.

In difficult financial circumstances, each Department must make its choice where to put the money. There will be occasions when it will decide that it is better, in revenue terms, to support the statutory services. There will be other times when it will decide to keep an even balance between funding the revenue demands of the statutory services, which are hard pressed, while keeping the same level of support for voluntary organisations. There will be other areas in respect of which they will decide that the voluntary organisations have a unique contribution to make and that that contribution must be held and expanded.

I attach great importance to variety as I believe in the innovation which often accompanies voluntary effort. I am against too strict a criterion for the application of central Government funding as I believe that we should ensure the freedom and independence of voluntary bodies.

The voluntary service unit, which will be dealt with by my hon. Friend when he winds up, has played a valuable rôle in co-ordinating Government Departments. I shall speak mainly about the Department of Health and Social Security and how we see its rôle in helping voluntary organisations.

I should like to deal with one or two specific points raised by the hon. Gentleman. First, he raised the question of the European Social Fund. In spite of its all-embracing title, it is in effect an employment and training fund which may meet up to half of the cost of training and resettlement schemes. The primary interest in the fund lies, therefore, with the Department of Employment. The fund extends to general social provisions only for the purpose of integrating migrant workers and their families into the social and working environment. The Home Office is involved in the latter area because of the work done through the Community Relations Commission and the Race Relations Board and the assistance given under the urban programme and Section 11 of the Local Government Act 1966. The Department of Health and Social Security has made applications. It applied, for instance, for a further provision for the disabled.

Applications to the social fund may be made by private bodies, including voluntary organisations, if the operations for which money is sought are already supported financially by a public authority. Applications must be submitted through official channels, which in this country means the Department of Employment. Alternatively, the Department may make application to the fund for 50 per cent. of the money spent in grants for purposes within the scope of the fund.

To date, it has been Government policy to apply to the fund for assistance towards the grants which they make to voluntary bodies and others rather than to encourage individual bodies to make applications. There are several reasons for this. In the first place, all the money paid into the European Social Fund from the United Kingdom comes from overall Exchequer funds. If some of this money came back into the economy directly in the form of grants to individual bodies instead of to the Exchequer, it would raise questions about the control of public expenditure. I do not claim that they are insoluble, but that is one factor.

Secondly, we need a considerable amount of detailed, knowledge and work to enable an application to be made in an acceptable form. It is obviously easier for a Government Department to undertake that than a voluntary organisation. I do not exclude voluntary organisations. But there are considerable delays. There is also no certainty that any individual application, even if eligible, will necessarily succeed, and, if it did, when payment will be received. Sometimes it is better that the voluntary organisations should obtain a definite Government grant and then reclaim the money on a national basis rather than take the risk of remaining for some time in a state of uncertainty as to their future funds, and perhaps finally being refused.

Those are the practical reasons why the Government acted in that way. To some extent, they arise from the initial entrance into the European Community and a wish to see how the organisation went.

No voluntary organisation has yet put forward an application within the scope of the European Social Fund for transmission to it. But there is no reason in principle why that should not be done or why the Department of Employment should not forward any application which seemed to fulfil the European Social Fund criteria.

Mr. Bruce Douglas-Mann (Mitcham and Morden)

Is my hon. Friend correct in saying that no voluntary organisation has made such an application? I was under the impression that the National Association of Youth Clubs had received a grant of £600,000 from the Social Fund. Does he agree that at a time of acute financial stringency in public expenditure it is desirable to obtain as much as we can from the Social Fund, even if that contribution must be topped up from public moneys to the extent indicated? That will alleviate some of the pressures inevitably resulting from a cut-back or a limitation on public expenditure.

Dr. Owen

The National Association of Youth Clubs acts as an agent to the Department of Employment for the Government-funded Community Industry scheme. The Department of Employment claims 50 per cent. of grants made to a number of organisations, including the NAYC. No individual voluntary organisation has yet made a formal application to the ESF through the Department of Employment. That is the reason for the misunderstanding of the unique relationship of the National Association of Youth Clubs to the Department of Employment, although I may be mistaken.

Mr. Anthony Steen (Liverpool, Wavertree)

I was fortunate. The race relations committee visited Brussels a few weeks ago, where we tackled the departmental officials on the question of the fund. It was clear that they were confused as to how voluntary bodies in this country should apply. I invite the Minister to consider ways of informing voluntary organisations, as they are even more ignorant than the officials in Brussels as to how to go about it. I request the Minister to add a clause about the European fund in the urban aid circular so that voluntary organisations will know the procedures which they must adopt.

Dr. Owen

Today the policy is to make application through the Department of Employment, to do so in the way which I have outlined and for the reasons I have mentioned. This is not a matter about which we have fixed policy views. Ministers are now becoming more interested in and more involved with the social fund. The social fund is changing. The United Kingdom submitted applications totalling £52 million for the year 1974. We were allocated about £26 million. In addition to the broad national schemes covered in the previous year, other operations, which are often smaller in scope, submitted requests for assistance. I could enumerate some of them. The applications for 1975 total over £54 million. These include additions to those schemes covered by 1973–74 applications, and a number of fresh applications in respect of schemes for training in rural areas under the auspices of the Forestry Commission, for training newly recruited workers on their own premises by two private companies in Great Britain, and the provision of vehicle services for disabled persons in Northern Ireland.

The social fund is changing. It may be in the interests of this country that it should change. We must consider not only how we can handle applications in this country but the direction in which we would wish to see the European Social Fund move. The Government have no firm view. I am describing the practice which was started by the previous Conservative Government and which the Government have carried on. There are good reasons for doing it in this way. I am ready to look at the matter with an open mind on a cross-departmental basis to see whether there is another way of doing it. If we made a change of policy, it is obviously important that the voluntary bodies should know.

Mr. Norman Fowler

The Government must have formed a view about what they are doing themselves, but this is still obscure. The NAYC and the Community Industry project are cases in point. I understand that £600,000 has been given for the project, and it has all be taken by the Department of Employment. I would like the Government to tell us what happened in this case. It involves a lot of money.

Dr. Owen

I described what I understood to be the situation. We will look into the matter to see if I was right. I think the hon. Gentleman will find that I was right.

The hon. Gentleman referred to the question of the way funds were backed and drew attention to the fact that some categories could not rely on being able to get funds themselves—I am thinking for example of drug addiction, alcoholics and down-and-outs in society. There is a responsibility here on the central Government to support these local projects. One example is the Department of Health's Alcoholics Recovery Project which operates in Lambeth, Camberwell and Lewisham. We are able to support that as a local project, but it would be wrong for us to support too many local projects. Most of them can get help from local authorities.

Sometimes national organisations can best go forward by putting their efforts into regional staffs and training. One example is the Pre-school Playgroups Association which receives a development grant of £65,000 to support the appointment of development and training officers in, for example, Birmingham and Newcastle. Their task is to initiate training, with the co-operation of education authorities, for volunteers to work in playgroups. The grant is intended to benefit deprived areas in particular, and the aim is to develop greater social competence in young mothers. Child minders also attend and benefit from these courses.

I do not like the tendency to think of grants to national organistions in terms of funds for headquarters. I have been attracted by the idea of directing money for the specific purpose of training volunteers. I dislike the term "professional" which is used to refer to paid workers and highly trained workers, but volunteers should work in association with professional people and they will need to develop their sense of professionalism, skills and training even if only in a limited sphere of activity.

When I look at voluntary organisations, either in my constituency or those I have been involved with in my Ministerial capacity, I find that those who place the greatest obligations and responsibilities on their volunteers seem to thrive the most. These organisations believe that the skills of volunteers can contribute to community service and that they need to be developed.

I do not lay down particular criteria, but if we look at the way we try to allocate resources, there are difficulties. Voluntary organisations are increasingly asking for more resources in order to meet existing demands, simply because of inflation and increased costs. Funds that help to attract more volunteers are money well spent, and so too is money which improves the skills and professionalism of volunteers.

The partnership between voluntary organisations and statutory bodies has been one of the most encouraging developments of recent years. Previously, there were suspicions that money given to voluntary efforts could always be better spent by being put into statutory efforts. There has now been a marked change in opinion and an increased willingness to work with voluntary people, particularly those who will accept obligations.

Funds which help to ensure that volunteers spend their time contributing to the service and not in raising more finance is money well spent. There can be too much effort put into raising money to keep activities going.

The central Government, when looking at their criteria, are faced with difficult choices. The Central Council for the Disabled, in dealing with the question of the new mobility allowance, has set up a working party on which my Department has an observer. It has met 2,000 disabled people throughout the country. This close working between statutory and voluntary work is very welcome, and my hon. Friend the Under-Secretary of State, who is concerned with the disabled, is very pleased with the cooperation between the Department and outside voluntary bodies. This is a rather novel example of working together.

The hon. Member for Sutton Coldfield referred to the NSPCC. The society is facing very real problems and provides an important statutory service in an area of growing concern. In March we made an emergency grant of £60,000, which was intended as a once-and-for-all payment to help the society overcome its immediate difficulties and to give it time to think out ways of increasing its income and making any changes in its activities. A grant of £127,000 over three years has also been made to help set up three battered baby units and pay for the salary of a research and playgroups officer. There have been a number of other grants. I have the highest regard for the work of the society, particularly in the area of non-accidental injury of children. It is now facing great difficulties. We met representatives of the society on 25th June for a further talk about its problems, and there will be another meeting. We are to look at its finances and figures. I cannot promise any assistance, but I attach a great deal of importance to the society's work and am very sympathetic to its plight. We shall do our best to help.

The hon. Member for Sutton Coldfield also referred to the Spastics Society, which has a long and well-established reputation as being self-supporting and raising considerable funds. We do not give the society any support. The fact that societies with a previously very good track record in raising funds are now getting into difficulties demonstrates our difficult and growing problems.

On the question of inflation-proofing, we estimated that our expenditure for 1974–75 would be £1,968,000. Considering that it was only £38,000 in 1968, this shows the substantial growth we have experienced in recent years. The actual provisional out-turn for that year is £1,778,000. This is closer to the estimate than in recent years, when there have been rather big gaps. We estimate that spending in 1975–76 will be £2,550,000.

I would like to be able to tell the House that this represents real growth, but I suspect it will only be keeping up with inflation. At this savage rate of inflation there is no question but that in order to fund at existing levels the central Government are very hard-pressed to keep them going. We shall therefore have to re-examine priorities and be selective about where we can help. However, the will is there. The belief exists that the voluntary organisations make a genuine contribution to the whole range of social activity, and we will arrange our commitments to try to protect them from inflation as best we can.

Of course, the best way to help voluntary organisations—and I believe it is the only way in view of the quite intolerable levels of inflation—is to reduce inflation. Wherever one looks one sees inflation as the dominant challenge. It erodes the standards of living of those least able to afford it and take defensive action, whether they are the very poor in the community or the voluntary organisations. They do not have the ability simply to raise charges. They have to provide their own revenue, and inflation is making life very difficult for them.

It is therefore right for the House to ask the Government to do everything possible to contend with the growing difficulties of the voluntary organisations. We shall do that. We shall bear in mind the European Social Fund, but hon. Members should not run away with the idea that this is some vast new source of money which can be drawn upon immediately. The subjects with which it has been concerned are very much the responsibility of the Department of Employment. The commissioners of the fund and the various other people involved in it in Brussels have said that this is an area of activity which will expand. The direction of that expansion is something which we in Britain should influence, and it is our firm intention to do so.

Under current practice Ministers consider whether they can use resources more effectively, and they alert the voluntary organisations, but there are practical difficulties, and many of the voluntary organisations that we help and fund have extremely limited secretarial assistance. Quite rightly, they run their headquarters organisation on a shoestring, and to put upon them the burden of having to go to Brussels to follow through all the arrangements there in a bid to secure grants may not serve their best interests. We should ensure that the opportunities represented by the European Social Fund are made more widely known. This is certainly an area for innovation and, I hope, for expansion.

What comes out must go in, and what comes out of the European Social Fund will have to go in in the form of contributions from the United Kingdom. The fund is not some new source of money. Relative deprivation is judged by other countries, and we may at times be able to put forward a case for a greater allocation of resources, but, on balance, we have to pay for them somehow. I warn the House against thinking that the fund is a magic cure for our present problems. It does not help them.

What is needed for the next few difficult years is a critical look at the activity of voluntary organisations, both by themselves and by the central Government, and a recognition that they will need special funding. At the same time there must be a recognition on their part that Government funds are not limitless. We shall be faced with severe stringencies in our revenue budgets on many essential programmes in the national community services. The Government will at times face a difficult choice of whether to put money into the statutory services or the voluntary organisations.

We believe that the voluntary organisations have a very important and expanding rôle. I echo the comment by the hon. Member for Sutton Coldfield that even if we had not been facing economic difficulties we ought still to have been discussing voluntary organisations. Even if we had a great deal of money we should be doing our utmost to try to expand the voluntary movement. It is not just a source of manpower—an increasingly scarce commodity—but in many areas it brings to bear the practical experience of people who have lived with some of the problems the organisations are seeking to deal with. The reformed alcoholic might devote a lot of time to helping alcoholics. A mother might want to help with children and will have the practical experience of rearing three of her own. Often people have old skills, which they wish to reactivate, but not on a full-time basis. All these people have a contribution to make to society which assumes even greater importance at a time when resources are strained.

Above all, however, this activity increases the number of people who are aware of the problems of their fellow citizens. In a real sense the voluntary spirit endorses the community spirit which is so essential if we are to live together in fairness and understanding over the next few difficult years when resources will be greatly strained.

4.56 p.m.

Mr. John Cordle (Bournemouth, East)

I am glad that the Government have found time to discuss this important matter—

Mr. Normal Fowler

It is we who have found the time.

Mr. Cordle

If the Opposition have found the time I am even happier. I am sure our debate will cause relief and hope among the voluntary organisations, which are facing a very critical time in the present stringent circumstances. A most remarkable and valuable debate took place in another place, and it was yet another pointer to the fact that many hon. Members in both Houses are seriously exercised and worried about the future of the voluntary services.

There have been two excellent speeches this afternoon from the Front Benches, and they covered a great deal of ground. They both dealt with inflation and its effect on the voluntary services. I sincerely hope that when our inflation problems level out, the Government will at least promise that these matters will be looked into and that some of the pressure on the voluntary services will be quickly eased. If we believe in voluntary services, and very few of us fail to admire 100 per cent. of the work which is done, and if we want this spirit of contribution to the life of the nation to continue, we must consider how we can quickly give help where it is needed.

It is universally recognised that there is a very real human need for people to be able to serve their fellows in the community. The various voluntary agencies are a vital medium through which many of our citizens fulfil that need. Many of the agencies plug gaps which are left by the services of the Welfare State. Discharged prisoners, need assistance not to drift back into crime, for example. Such voluntary agencies act as a supplement to the Welfare State and are spurred towards a higher standard of care.

The Government therefore have the duty to encourage the ideal of service within the community and to ensure that as many people as possible can devote their leisure time to constructive activities. In voluntary services we need to complement rather than supplement our great statutory services. The voluntary services fulfil this desire on the part of all sorts of people to serve their fellow human beings without thought of gain or recognition for themselves. When we were children my mother taught us that the rate for our room while on earth is service. Without that quality of life or service to others in life, it would be a very boring and unrewarding existence. If ever there was a need for more voluntary service and not less, it is today.

There are those who argue that statutory service provides all that is needed. Let it be clearly understood that without the voluntary services in Britain much of the work in our statutory social services would cease to function. Years ago there was the discipline of National Service. There are few ways today in which our young men and women can find that necessary discipline, which does so much to help them face the temptations and pitfalls of life. Therefore, through the voluntary service unit we have to make more opportunities possible so that adolescents in particular can discover themselves and their individual capabilities through the challenge of adventure and hardship.

It is a fact that so many of the problems from which society suffers today—the crimes of violence among the young, the muggings and general anti-social behaviour—are, in part, due to lack of outlets into which pent-up energy, frustration and desire for adventure can be properly channelled. The excellent Gov- ernment Voluntary Service Unit, which was brought into being a short while ago—

Mr. Steen

By us.

Mr. Cordle

By us, indeed. This unit could be utilised a great deal more than it is. There should be a greater effort to publicise it so that in local authority areas, and even down to ward level, young men and women are aware of what co-ordination work can be undertaken. These young people could then join a voluntary service unit or a voluntary service in their own community.

We recognise that the traditional voluntary services such as the Fire Service, the Coastguard and the Mountain Rescue Service are the glamorous services for youth to join, but there are ordinary forms of service to the community which can still be a great blessing for the young. His Royal Highness the Prince of Wales said in the other place when speaking in the debate two or three weeks ago that this service would be "… good for the soul" of the nation. Although we have anti-litter collection groups, we could have more such groups. We should organise more groups to remove the dangerous and abandoned pieces of old iron in the countryside and around our towns—the old abandoned motor cars and agricultural implements that are left lying around and cause so much danger and harm. With just a little training in group control and only a small outlay by local authorities, great areas of our towns, cities and countryside could be cleaned and cleared up to the benefit of the nation as a whole. This could be another dimension for the young—a way to provide other positive and constructive activities rather than activities that lead to trouble.

Youth cries out to prove itself. Any enthusiasm for voluntary service should be jumped at by our county and district councils and harnessed for the good of both those who give and those who receive.

Is there a way in which greater publicity can be given to the voluntary service unit, and can it be brought down to the level of the local authorities? If funds can be given to local authorities to enable them to use this facility, so much the better. I accept that it is quite unrealistic to expect the Government to increase the real level of grants to voluntary organisations at preesnt. Voluntary organisations have been squeezed by inflation. Their funds have failed to increase at the same rate as their costs of operation and administration. Two things should be done. First, we should enable the societies to make fuller use of the funds they receive for the purpose for which they exist. Secondly, we should enable societies to attract additional funds from sources other than from the Government.

There are four areas of action. First, the voluntary societies should be able to reclaim the VAT which they pay on their telephone bills and on the many other services which they purchase from day to day. Administratively, it should be quite simple to allow this type of rebate when dealing with a tax matter in respect of all taxable persons claiming input, that is, VAT paid by them in producing goods and services as a deduction from VAT due from them.

Secondly, the Government should recast the law of charity to extend charitable status to many of the modern voluntary organisations which fail to fulfil the Elizabethan criteria of charity because they cannot be said to be within the spirit and the "intentment", as they said in those days, of the preamble to a statute of 1601. A fresh look should be taken at the question of charitable status to ensure that all voluntary societies, which exist to serve the public, to benefit the environment and to preserve our heritage, are freed from the burden of taxation of all sorts.

Thirdly, the Government should announce a commitment to drop from the Community Land Bill those parts which prevent voluntary societies from exploiting the development value of their land. If the aim of the Bill is to divert money from the unholy—that is, the speculators—to the community, it would be totally ridiculous to divert funds from the voluntary societies to local government, which would then be expected to provide grant aid to the societies. A more baseless and useless administrative process is difficult to conceive.

Fourthly, the co-ordination of voluntary societies means that authorities should encourage cohabitation of various societies in one building so that their overheads can be cut and wastage dealt with effectively. This would mean positive action by local authorities which could achieve a great deal in this area.

The Government cannot give more grant aid. Therefore, perhaps individuals and corporations could be encouraged to give more. The very rich could be bribed by further tax relief to devote more of their wealth to the voluntary services and societies. Surely the principle of the seven-year covenant could be and should be extended? The cost to public funds would be a mere pinprick's loss of revenue in comparison with the enormous benefit to the voluntary societies in terms of finance and in boosting their sagging morale, because it would indicate positively the Government's determination to enable them to assist themselves.

The Government's record in giving grants to many voluntary organisations is good. I can only trust that the Government will avoid taking any steps which would have the effect, even unintentionally, of spoiling that splendid record.

Mr. Deputy Speaker (Mr. George Thomas)

Before I call the next hon. Member to speak, I should like to tell the House that, so far as back benchers are concerned, I fear that time may run out in one hour and 10 minutes, and that about 10 hon. Members wish to speak.

5.10 p.m.

Mr. Frank Hooley (Sheffield, Heeley)

I shall endeavour to observe the spirit of your warning, Mr. Deputy Speaker, and be as brief as I can.

I suppose that most hon. Members have served or currently serve in voluntary organisations of one kind or another. I have been involved in the work of the United Nations Association for nearly 30 years. That is one body of which I have some fairly close knowledge. Ten years ago the United Nations Association had a headquarters staff in London of 21 people, from the director down to the typists and office staff. Today that number is down to 11. That is not because the United Nations Association considers its work any less necessary or desirable now but simply because of the ruthless pressure of costs. Likewise, a few years ago we had a field staff of regional officers in England, Scotland and Wales amounting to nine or 10. That number is now down to seven.

I remember a ferocious argument a year or two ago in the finance committee as to whether we could afford to pay for five or three persons dealing specifically with youth matters and the promotion of interest in and knowledge of the United Nations and its agencies among students and young people. Today there is no argument about five or three. There are none. We cannot afford to employ any staff for that specific objective. The reason for this, as has been mentioned in the debate, is the ruthless pressure of increasing costs—the costs of office space, staff, secretarial assistance and so on.

Office space in London is an enormous problem. It may be argued that voluntary organisations ought not to maintain head offices in London. But a body such as the United Nations Association wishes to keep close contact with the Foreign and Commonwealth Office, the Ministry of Overseas Development and sometimes, on race relations and human rights problems, with the Home Office. We have hitherto considered it essential to have some headquarters post in London, but the cost in terms of rent, rates and services rises year by year.

Likewise, as regards staff, we have a very dedicated and valuable group of people working as the professional staff of the association. Although we make some effort to keep the salaries abreast of the rising inflation, this is becoming a more and more impossible job as years go by. Consequently we are having to reduce the number of people we can employ. This applies not only to staff with special qualifications and interest in international affairs. It applies even more acutely to the secretarial and office staff who are absolutely essential for running the day-to-day work of the office.

The problem in respect of travelling is similar. Obviously an organisation such as the United Nations Association, which has branches all over England and in Scotland, Northern Ireland and Wales, must take steps to see that the staff travel around and keep contact with members. Equally, lay members of the association wish to take part in national committees and some of their travelling expenses must be paid. The costs of petrol and of train and bus fares and so on go up and up all the time. Running costs such as stationery, postage, telephones and particularly publications become a heavier charge year by year.

Publications are a very serious problem. A body such as the United Nations Association, which has primarily an educational objective, clearly wishes to put over to its members and the public information and views about the work of the United Nations and the great range of agencies which have developed under the United Nations. The cost of doing this is becoming almost prohibitive.

One of the obstacles or penalties in trying to deal with this kind of work derives from the operation of value added tax. We now find that if we have a dinner or a social function for the purpose of raising funds, VAT has to be charged on tickets. We have found that VAT has had to be charged on a section of our membership subscriptions simply on the ground that by supplying a certain group of our members with publications we are giving them a service, and "service" is subject to this iniquitous tax. There is VAT on telephone charges, as mentioned by the hon. Member for Bournemouth, East (Mr. Cordle), and on stationery and petrol. This pushes up the cost of travel and so on.

This is one sphere in which the Government or some corner of the Treasury could perhaps be induced to study whether, by some technical arrangement, voluntary bodies could be exempted from the impact of this tax.

It can be said that everyone has to put up with inflation. However, the great difficulty for voluntary bodies is that they simply cannot put up their prices. They can raise their subscriptions and increase charges for publications, but the result may simply be a diminution of income.

One possible way out of the difficulty would be a request for an increase in Government grant. It has already been pointed out by a number of speakers in the debate that the prospects of this are not good. There are, in any case, certain difficulties and disadvantages in relying on public finance of that kind for a voluntary body. First, the grant itself is quite uncertain and in some respects quite capricious. Looking down the list of bodies with interests in international affairs, the bodies which appear on the list in the Estimates for the Foreign and Commonwealth Office, one can find the most extraordinary range of sums given to different bodies which are concerned with the promotion of understanding of international relations either in a global sense or for particular regions. There seems to be no special rhyme or reason why one body should get a grant and another should not, nor does there appear to be any reason for the actual amount of grant to particular bodies, which in some cases may run to £100,000 or so and in others just a few thousand pounds. Therefore, there are clearly difficulties in expecting to support voluntary bodies by means of Government grants.

There is, however, one very important area in which some steps could be taken to improve the situation of voluntary bodies which do not enjoy charitable status. The present law on charities is a complete muddle. There is no rhyme or reason about it. As the hon. Member for Bournemouth, East has mentioned, it derives from the preamble to a statute on charitable uses of 1601. Very little that is effective has apparently been done to clarify the law since that date.

The advantage of charitable status is that it gives to a voluntary body certain important exemptions in relation to taxation. Charities do not pay income tax, corporation tax or capital gains tax on their investment or other income. Donors to charities are exempt from capital gains tax on gifts to charities, and bequests of up to £50,000 are free of estate duty. Charities can obtain 50 per cent. relief from paying rates. However, under the wierd laws we have at present a voluntary body such as the United Nations Association—and there are a great many such bodies—does not qualify for charitable status and cannot enjoy any of those advantages.

In 1967 the Charity Commissioners themselves said: Charity law is not always governed by logic nor are the decisions entirely consistent. Being so vague, the law is open to arbitrary interpretation by the commissioners. They are virtually free from any possibility of appeal. I understand that between 1960 and 1971 there was only one appeal resulting from 1,380 refusals of charitable status. The reason for that is the enormous expense of an appeal. In any case, an appeal might not he successful.

Mr. Steen

Is it the hon. Gentleman's view that the Charity Commissioners should be abolished? If that is his view, what would he put in their place?

Mr. Hooley

No, it is not my view that the commissioners themselves should be abolished. What I want to put forward is an idea that might create a new category of voluntary bodies which would not be charities under the old definition and which could enjoy, subject to the control and supervision of the commissioners, certain advantages which other charities at present enjoy.

Mr. Steen

Is the hon. Gentleman suggesting that any organisation that is not aimed at private gain and which is concerned with the benefit of the community should receive financial help?

Mr. Hooley

If the hon. Gentleman will allow me to get on, I shall come precisely to that point.

The major defect in the present law is the exclusion of political activity on the part of a charity. Of course, political activity can be defined in a very broad way. It has been suggested by the Charity Law Reform Committee that a new category of voluntary bodies should be created called non-profit distributing organisations. I do not care for that title very much but it indicates the sort of body that the committee has in mind—namely, a voluntary body which has no intention of making a profit for its own members who are doing important voluntary work but which under the existing law on charities cannot qualify for charitable status.

As I said in answer to an intervention from the hon. Member for Liverpool, Wavertree (Mr. Steen), such bodies would still be subject to supervision by the Charity Commissioners. There would be clear and definite rules under which they would have to conduct their affairs. For example, they might be required to pay an annual registration fee to the commissioners. Their accounts would he subject to audit, filed with the commissioners and made available for public inspection. The constitution of these bodies should provide a method of appointing a governing body and should lay down their objects. The issue of any dividend or other distribution of profits or assets would not be permitted.

I shall not go into all the detailed suggestions for the regulation of this new category of voluntary body. I think the House will understand that what is desired is that voluntary bodies whose purposes are not charitable in the rather narrow philanthropic sense but which have an important contribution to make to our social life in putting forward ideas, studies and thoughts should be able to enjoy tax advantages subject to registration, supervision and the control by the commissioners. Subject to those conditions, they should be able to enjoy the advantages that the more orthodox charities currently enjoy.

It would be a serious loss to our society if voluntary organisations were to be seriously reduced in their activities or if they were to disappear altogether as a result of the pressure of inflation and increasing costs. Many of them have played a pioneering and experimental rôle that has often been extremely important in alerting the public to social and political problems over many decades.

5.26 p.m.

Mr. Richard Luce (Shoreham)

I agree with quite a number of the points made by the hon. Member for Sheffield, Heeley (Mr. Hooley). He referred to the need for an examination of the law on charities. He rightly said that the law has not been reformed since 1601. I think I am right in saying that a committee has been established already to consider this problem under the umbrella of the National Council of Social Services and under the chairmanship of Lord Goodman. I agree that this is a matter that needs examination, and it seems that it is already being examined.

To me and, if I may say so, to Mr. Speaker this debate is very timely. On Sunday I had the privilege of accompanying Mr. Speaker on a sponsored walk in Sussex on behalf of the NSPCC. I might say that it was a 17-mile walk. Having seen the pace which Mr. Speaker set, I nearly asked you, Mr. Deputy Speaker, to give me leave to make my speech sitting down because I am extremely stiff.

There were two things that came out of the walk that struck me in particular. The first was that there are enjoyable ways of raising money for the voluntary movement. The second was the number of children taking part in the walk and the great spirit among the younger generation. It seems that there is a great desire among that generation to make a contribution to society. Now is probably the time to test the voluntary spirit of the nation against a background of inflation, pressure on public expenditure and pressure on individual members of families.

It is clear that there is a serious threat to the voluntary movement. It has already been clearly said that individual charities have been affected. For example, there has been a fall in the number of NSPCC inspectors because of the lack of finance available to that society. There has been a fall from 260 last year to 220 this year. My hon. Friend the Member for Sutton Coldfield (Mr. Fowler) highlighted the dramatic reduction in the income of the Spastics Society. Those are only two examples of the problems that are faced by large and important voluntary charities.

The voluntary movement faces a situation in which there is bound to be a cut-back in the availability of public funds to assist them. That applies not only to central Government funds but to local authority funds. It puts an additional burden upon the voluntary movement at a time when its own resources raised from individuals on a voluntary basis are under pressure. The voluntary movement faces the additional pressure of increased costs at a time of inflation—for example, postage and petrol charges. There is the problem of rates and also the problem of VAT. I think that the Ministers responsible need to take a co-ordinated look at the variety of problems that are facing charities.

We should try to tackle this problem on a co-ordinated basis. One example is provided by VAT. Is there not a way whereby the Government could try to alleviate the charities' difficulties? There are three aspects of the problem that require careful examination. First, there is fund-raising on a voluntary basis. Every encouragement must be given to finding new methods of raising funds. I was involved originally as the Director of the National Innovation Society, of which Dr. Michael Young was Chairman in the late 1960s, in trying to persuade successive Post Office corporations to begin an experiment in the sale of charity stamps. The experiment was eventually launched after seven years of hard work by many people in January and February of this year.

The Home Office has some responsibility for the charity stamp and its sale to the public. It is an idea which has been put into practice for many years in New Zealand, Switzerland and France in connection with the Red Cross and other organisations. Perhaps the Minister in his reply can give some idea whether the carity stamp has been a success.

The Minister of State, Home Office (Mr. Alexander W. Lyon) indicated dissent.

Mr. Luce

The Minister is giving an indication that he cannot give that information. However, in the time that remains to him in the debate he may be able to dig out some information on that score, because it would be of great help. Every encouragement should be given by the Government to conduct experiments in finding new methods of raising funds for charity.

I should like to refer to the pressure of costs which is being experienced by voluntary organisations. It is right to say that most charities are extremely good in containing their administrative overheads, and the more encouragement we give them to enable them to share costs and cut down on administrative overheads the better. We should try to persuade more charitable bodies to take a lead in finding new ways of sharing overheads.

In the United States, for example, a number of charities combine to share buildings and staff and thereby cut down administrative costs and wages. It would be a good thing if encouragement were given to the National Council of Social Service or some other suitable body to take a lead in finding ways of enabling charities to share costs and cut down on burdens. I am not against competition among charities in raising money for a similar cause—the deaf, for example, have a number of charities to assist them—but ways must be found to ensure that there is no duplication of effort.

I wish to turn to the question of practical help given by individuals in our society. There is an enormous voluntary spirit in this country. People need to be told how they can help. Some of us looked with a degree of anxiety last year to the growth of what might be called the voluntary civil defence organisations, but many people joined that movement largely out of a sense of frustration. They want to serve their country, but they are not being given a sufficient lead. They are not being told how they can serve the country. Therefore, if only the Government, local authorities and the charities can set the right lead and channel energy in the right directions, the sense of frustration will be relieved.

The local authorities have a most important rôle to play. I accept that they cannot give out more money in grants, but what they can do—this happens in Sussex—is to co-ordinate the efforts of both voluntary and statutory bodies in seeking to ensure that all the needs and requirements of, say, the retired population are generally monitored and catered for.

At a time when unemployment is rising many school leavers are finding it almost impossible to obtain a job, although there are voluntary bodies which give assistance, such as the task forces and similar organisations. Should not the Government and leading charities try to take a more positive lead in channelling their energies into assisting the community in ways that fit particular interests? Now of all times, in this great economic crisis, is the time to tap the voluntary spirit of the nation. If we do so, I am sure that the people of the country will respond.

5.35 p.m.

Mr. Bruce Douglas-Mann (Mitcham and Morden)

I had not expected to take part in this debate, and I have only been able to do so by virtue of Mr. Speaker's consideration and also by having deferred a meeting. Therefore, I hope that it will not be considered discourteous of me if I leave the House soon after concluding my remarks.

I was anxious to speak in this debate because I am a vice-chairman of the National Council of Social Service and a member of the board of Shelter. I am sure that the problems mentioned by my hon. Friend the Member for Sheffield, Heeley (Mr. Hooley) in respect of the United Nations Association are duplicated in Shelter and, indeed, in the vast majority of voluntary organisations at the present time.

I have a somewhat ambivalent attitude towards voluntary organisations although my attitude has changed in the last few years. I believe that 10 years ago the rôle of voluntary organisations was somewhat superfluous in a properly organised society. I felt that the Government and local authorities should be taking on the great majority of the responsibilities fulfilled by voluntary organisations. But I have substantially changed my view. The extent to which voluntary organisations can provide flexibility in an area where Government operations have to be conducted within fairly rigid rules provides opportunities to remedy many ills which otherwise would remain unmet.

I have found frequently that voluntary organisations can pioneer a service which is gradually taken over by local authorities. We have only to think of the law centres as falling within this category. The North Kensington Law Centre, for example, was begun as a voluntary service and funded entirely by charitable money. Above all, voluntary organisations provide an opportunity for those who wish to serve the community by contributing towards it. They provide an outlet for service which not only benefits the community by the work done, but allows people to work together and so create a community in the full sense of the word.

In housing, matters the Government imposed by the Housing Act 1974 placed great responsibilities on the voluntary housing movement. Clearly the private landlord will inevitably disappear. I do do not wish to enter into the politics of the matter, but I do not want to see the local authorities acting as the only providers of rented accommodation. The effort must come from housing associations.

It has been emphasised in almost every speech in the debate that the plight of the voluntary associations is bad and is growing steadily worse. Specific remedies have been suggested, and I am sorry that we do not have on the Government Front Bench a Treasury Minister to deal with the tax aspects of charities. At present it is not likely that there will be any increase in Government assistance to voluntary organisations. The tax relief is as much a contribution from public funds as is a direct Government grant, but it does not have quite the same effect. We must seek to resolve some of the problems caused by the imposition of value added tax and examine the question of rate relief for charitable shops. A number of charities derive considerable income from such shops and they would like to know where they stand. I hope that in the near future the Government will find time to put the situation right.

Mr. A. J. Beith (Berwick-upon-Tweed)

Would not the hon. Gentleman agree that one of the tax difficulties which could be resolved with the least direct impact on public expenditure problems is that which arises in the case of capital transfer tax in relation to voluntary organisations which are not charities? In this case, one would be dealing with a new tax and not making an increase in Government expenditure. That tax is a new form of revenue.

Mr. Douglas-Mann

Capital transfer tax is not a completely new tax. It is a foolproof way of levying estate duty. Do not let us pretend that it is a new form of revenue. I would not rule out changes in that direction also, but I accept that there is a great deal that can be achieved by remission of tax, because in many cases the money that goes to a charitable organisation produces far more, pound for pound, than money spent directly through local or central Government.

I should like also to echo the point made by my hon. Friend the Member for Heeley on the law relating to charities and voluntary organisations. I shall not go quite so far as he did, since I feel that it is desirable that we should have two categories. The first is the voluntary organisation which is a nonprofit-making organisation—which would include inevitably all the political parties—and which would have some of the benefits of tax relief and of relief from being treated effectively as a commercial organisation, and also another category with full charitable status. This, however, as was pointed out, is a matter that is being considered by the committee set up under Lord Goodman. Bearing in mind the degree of expertise and expert evidence that that committee is receiving, I have little doubt that a viable and sensible proposal will be made for amendment of the law. As long as the Government are considering the matter very carefully and find time to deal with the proposal when it is made known, I think that it can be left like that for the time being.

The social fund of the EEC was dealt with to some extent by the Minister in his opening speech, but he did not make quite clear that what the Government are actually doing at the moment with the United Kingdom allocation from the fund—at £26 million it is quite a lot of money—is substantially, as I understand it, to relieve the Government of some of the burden of supporting voluntary organisations rather than increasing the total amount of contribution to such organisations. To a certain extent that is desirable and legitimate, but at a time when public expenditure is necessarily being limited, and when charitable and voluntary organisations are under quite unprecedented strain, the opportunity of using this fund to assist voluntary organisations is one which should be developed by the Government to a very much greater extent than it has been so far.

There has been extraordinarily little publicity about it, and I think that a very large number of voluntary organisations are unaware that they might even be considered as eligible for assistance from the fund. It is a fact that any additional money coming from the social fund will come only if the Government or public funds are providing the other 50 per cent., and understandably the Government do not wish to see their own contribution being increased in order to top up what is contributed.

I think that there could be a greater degree of flexibility concerning the applications which are considered and channelled by the Department of Employment to the social fund. I accept the case made by the Minister that such applications should normally be channelled through the Government, but they should be chan- nelled not filtered. Where there is an appropriate case for consideration by the social fund, the Government should channel it, even if they do not feel enthusiastic about it, and leave it to the administrators of the fund to decide whether to accept it. Perhaps the Government can find out—I know that the National Council of Social Service has not been able to do so, and I do not think that any of the voluntary organisations have done so—what are the priorities exercised by the social fund.

I am informed that the social fund categorises the applications into four priorities, and that if an application comes into priority one or two there is a good chance of getting it accepted but that if it comes into priority three or four it has scarcely any hope. That would be fair enough if one knew what were the criteria, but, as I understand it, the voluntary organisations have been quite unable to ascertain—even if they come within the area of eligibility in relation to employment and so on—exactly what these criteria are.

Will the Government try to encourage the administrators of the social fund to review its criteria when they find out what these are? I am informed that for example, the Commission is keen to encourage social fund applications for the training of women over the age of 35, but this also has to fit into the fact of the scheme being operated in an area of high unemployment. The problem is that in an area of high unemployment the retrained women do not find prospects of employment after their retraining. The difficulties resulting from this are that beneficial schemes are frequently unable to get the support which should otherwise be available from the social fund.

I hope that the Government, following on this debate, will be able to look into some of these difficulties and find out the relatively minor steps which need to be taken to alleviate the difficulties of the voluntary organisations at this time.

5.47 p.m.

Mr. Anthony Steen (Liverpool, Wavertree)

If the Minister of State, Department of Health and Social Security was in the Chamber now, I am sure he would agree with me that it is inconceivable that the Government should wish to destroy or take over voluntary organisa- tions or to show disinterest in the provision of opportunities for volunteering and individual acts of altruism. But if he were to feel that it is inconceivable for the Government to take that view, it is quite clear that the Government's policy is somewhat at odds with his own view, because the policies of the Government have been increasingly aimed at destroying the effectiveness of voluntary organisations, not only by stifling them of sufficient resources, on the one hand, but also by failing to give them sufficient status or to recognise and understand the underlying moral qualities of self-sacrifice which are inherent in acts of service. A cursory look at the Government's legislation leads to this conclusion.

Perhaps the Government resent voluntary organisations as a form of private enterprise. Perhaps Cabinet Ministers do not agree with Lord Beveridge's definition of voluntary work as a distinguishing mark of a free society. Perhaps Ministers need to acknowledge that voluntary effort is an answer to the proposition that the State cannot do it all and that the State must not be allowed to do it all.

It would be useful to start by looking at the capital transfer tax, which, I believe, was the first warning note of the Government's intentions towards voluntary bodies. If the Government had not bowed under the wrath of the voluntary organisations' concerted attack, a situation would now exist whereby donors would not only have lost tax advantages if they gave to charity but would be penalised if they gave too much.

Although the evils of the tax have been modified in relation to registered charities, there are still a series of disadvantages suffered by voluntary organisations not registered as charities, such as the Disablement Income Group, Amnesty, the Brent Law Centre and the United Nations Association and which are placed outside the provisions of the Act.

Prior to the Act, gifts made up to one year before the donor's death for charitable or public purposes were exempted from aggregation for estate duty purposes. This definition dates from 1881 and has been confirmed in a number of cases as encompassing a wider range of organisations than those registered as charities.

Under Schedule 6 to the Finance Act gifts to registered charities only will be free of capital transfer tax and no relief of any kind will be given on gifts for other public purposes. The financial effects of this change are potentially most serious, since all gifts to unregistered bodies will be liable to the full rate of capital transfer tax, subject only to the overall allowance of £1,000 on gifts of all kinds per year. Not only will the net value of gifts to unregistered organisations be reduced severely but potential donors will be discouraged from supporting such groups at all.

It is not, however, merely the financial effects of the new arrangements which are of concern but the implication that this Government wish to discourage support for the wide range of community and pressure groups which for various reasons are excluded from charitable status. Since the value of the contribution which such groups make to the community can hardly be doubted, one would have hoped to find the Government prepared to improve their financial position or at least to impose no further financial disadvantage.

The only conclusion that we can draw is that by making a fundamental change in the existing law the Government wish to discourage support for such organisations. If the Minister wishes to rebut my allegation that the Government are not in favour of unregistered charities which do essential work in the community, he should urge his colleagues to do something about it.

Mr. Alexander W. Lyon

Is the hon. Gentleman saying that because his Government did not make a concession in relation to VAT on such bodies which were not charities, his Government were opposed to voluntary organisations which are not charities?

Mr. Steen

What in fact has happened is that, in preparing new legislation, the Government of the day had an opportunity to correct anything which they felt needed amendment. The fact that they continued something which clearly was an injustice showed that they were not minded to improve the situation.

I take as another example the Community Land Bill. There a medieval situation existed, with the Archbishop of Canterbury begging the Prime Minister to exempt church land from a crippling land tax—something more suitable at the time of the Reformation than in 1975. There is still no firm answer about whether the Church or charities will be exempt from this crippling tax.

If the Government are indignant about this alleged anti-charity posture, how do they explain the invidious distinction between "worthy" and "unworthy" charities? It is hard to imagine a more divisive proposal than that which undermines certain educational charities.

I turn next to the urban programme. It was designed to bring additional resources to the deprived areas and to stimulate greater community participation through action projects. It has ended up with the local authorities getting the lion's share, and that it not really surprising because most of them have been so curtailed in their development programmes that they have had to use the urban aid programme to do the work which they should have done out of the rates.

Similarly the voluntary organisations have found that in terms of priority they have been well down the line, and with the Home Office as the final arbitrator it is not surprising that they have chosen those schemes which local authorities put at the top of their lists, namely, their own schemes. If the Minister is so concerned about voluntary bodies, he might well consider publishing the list of criteria on the basis of which officials decide which schemes they will choose. This is a matter which the Opposition have been pushing for over many months and for which I pushed over many years as the director of a national voluntary body.

The Minister will perhaps also look into the abuses of the urban aid programme, where local authorities are known to say to voluntary bodies "If you raise the 25 per cent. which has to be found, we shall submit your application to the Home Office for the 75 per cent." As the Minister knows, that is not the way the urban aid programme was designed. The local authority was supposed to put up the 25 per cent. and not the voluntary body to raise it.

It is not surprising that voluntary work at the grass roots has not been promoted and stimulated more, and I fear that in the present economic situation more local authorities will use the urban aid programme merely to maintain the level of grants which they have been giving rather than to make fresh grants. As for the EEC's social fund, the impression we got when in Brussels was that the Government were considering recouping the money which they were already giving in grants out of the social fund rather than making fresh money available.

I turn to the Government's attitude to the urban deprivation unit, which links up with the urban aid programme and which was designed to help voluntary bodies. What has been achieved by this unit to help voluntary work and self-help groups in deprived urban areas? What practical implementations of its recommendations have been put into effect by the Government? What is the Government's attitude to neighbourhood work in deprived urban areas, where voluntary effort can help to assist the statutory workers? I have in mind the Southern Neighbourhood Project in Liverpool, which is one of the most successful neighbourhood projects in the country. How could the Government cut off the grant which they gave under the urban aid programme a year or two after giving it, leaving this group of residents high and dry? Then, again, there is the the project known as SLAB near Bristol, providing intermediate treatment for deprived and disadvantaged teenagers. The Home Office gave one year's grant to this voluntary body, only for it to find a year later that the grant was cut off, leaving it in great financial difficulty.

Although the Government pay lip service to voluntary work, all the facts support the view that a new boost is necessary to keep the organisations afloat. Perhaps the answer as to why these things have not been done before can best be found in how the Government see voluntary work. Perhaps they see it as a legacy of the wide gaps between rich and poor and the class distinction of the past and they think that community spirit, as the basis of modern social action, is best expressed through publicly-provided services.

It is the very growth of statutory services which has been at the root of the decline in personal responsibility and the increased dependence on the State. The preponderance of professional social and community workers, despite their best of possible intentions, has often gone to perpetuate the apathy of those living in deprived circumstances and has helped in many ways to break up families rather than keep them together. If the housing accommodation was right, how often would we see the extended family, with grandparents looking after children and children looking after grandparents, rather than the grandparents being carted away to an institution and the children being pushed into care?

I suggest that the fundamental mistake of this Government has been that they are concerned with building up the State rather than with encouraging voluntary effort. It is curious that this Government should take that view, because the so-called working classes have always had strong, close-knit communities. Now that the State has taken over, those communities, especially on new housing estates, have tended to break up.

If the Government seriously believe in promoting voluntary effort, why do they not make some practical gesture towards voluntary bodies such as giving a penny off the rates to the promotion of voluntary work? Why do not they sponsor the idea of a town hall for voluntary work, running side by side with the statutory local authority town hall, so that there is a dual operation? Why do not the Government encourage far greater use of honours to voluntary workers in the Honours List? One assessment which I made revealed that 1 per cent. of honours went to voluntary workers. Another showed 8 per cent. Why should not greater encouragement be given to the voluntary worker?

Let us concede, therefore, that the concept of charity—stern, morally selective and reformatory—has gone and that a new concept of social welfare has taken its place and recast the social philosophy which the voluntary bodies inherited from the past. Welfare now goes far beyond the relief of material distress. We now aim at the enrichment of life for those who, from whatever cause, are missing or losing what lies in our power to give.

We are concerned now with the quality of life, and this is work for the community as a whole and not for the welfare authorities alone. This is the working basis for partnership between the two, the blend of public and private service typical of doctrinal conflicts in our society between collective action and free enterprise. The two somewhow must live together.

I see no escape from overlapping between voluntary and State provision, for two reasons. One is that social needs will grow faster than the combined effort of voluntary and State action to meet them. The rapidly increasing numbers of old people, the consequences of early marriage and of no marriage which will bring larger casualties among women and children, the wider understanding of the plight of the handicapped and disabled and the growing menace of mental instability and illness are among the formidable prospects confronting us all.

The second reason is that the boundaries between the voluntary and statutory fields of action are nowadays blurred.

The existence side by side of voluntary and State services should stimulate mutual criticism and be of mutual benefit. Non-Government agencies have flexibility and freedom from tightly-drawn rules and regulations. They can pioneer and experiment. In the last analysis, voluntary societies call for no self-justification. That they exist, flourish and are unimpeded in their work is of itself enough. If they folded up we could despair, for the tyranny of Socialist bureaucracy would be on its way.

6.4 p.m.

Mr. Terry Walker (Kingswood)

It gives me great pleasure to follow the hon. Member for Liverpool, Wavertree (Mr. Steen) because he has long been associated with the Young Volunteer Force, and SLAB, which he mentioned, is in my constituency. I pay tribute to him for the work done there among young people. But obviously he would not expect me to follow his other comments about the rôle that the Government should play with regard to the plight of voluntary organisations. The problems of the inflationary trend have come out very strongly in this debate, which is taking place within the whole consensus of the economic situation around us, and one appreciates the plight of voluntary organisations as they see the "chopper" coming in public spending at national and local government level.

One must make at the outset the point that the voluntary organisations are doing very useful work that should be undertaken by local authorities, which in many instances are not facing up to that responsibility because of the financial constraints upon them. In the future the burden will fall upon the voluntary organisations. Not all of us are prepared to envisage a cut-back in local government services. I agree with the hon. Member for Wavertree that the Treasury must take a new look at the whole of the charitable organisations to see whether they can be helped in some way If help is not forthcoming, and if organisations like the Young Volunteers and NACRO go out of existence, it will mean, regretfully, that no help will be provided for those who sorely need help.

This is the situation in which we debate this subject tonight, and all hon. Members see the problems besetting us. We know that Exchequer funds are not available to any great extent to help, even though all of us, as politicians, involve ourselves as much as we can. Certainly, before I came to this House I involved myself tremendously, but, lamentably, when one gets into this House one is in a straitjacket, unable to play a full part. If a politician allies himself with a particular voluntary organisation, people generally tend to believe that he is doing so for political gain and not because he believes in that organisation.

We have to take a new initiative as politicians, to bring home to ordinary people the fact that the only people who can really finance charitable organisations are the public, by their contributions. As many hon. Members may know, I am an active churchman, and one of the great things about the Christian Church is that people still pay the same amount in collections as they did 20 years ago, an amount now quite inadequate. The sum that would buy a box of matches 20 years ago will now buy nothing at all. It is important to remember, when one covenants at the beginning of each year to give money to charitable organisations, that with the present rate of inflation more money is needed and, therefore, we must give more. Many people throughout this country would be prepared to give more if only they were made aware of the problems besetting us.

It is no good hon. Members saying in this debate that people should be exempted from income tax or given other small-fry concessions like that. We want ordinary people to face up to the commitments, to face up to the needs of society. In that respect I am quite sure that the Minister who is to wind up will bear out that we cannot rely on the central Government or local government to solve our problems. The solution is in our own hands. No one knows better than I the problems that have beset the Churches under the Community Land Bill. I have had many letters on that subject which I have been able to pass on. What has worried me was that the Churches appeared to be asking for concessions that were not available to charitable organisations. I feel that charitable organisations have as much right to help as do the Christian Churches. I hope that when the concessions that have apparently been made in Committee are brought to the Floor of the House it will be made abundantly clear that what is to apply to the Churches will also apply to the charitable organisations, which are doing a magnificent job and doing the things we want done.

In conclusion, I believe that the burdens that face us in the inflationary situation in which we find ourselves must be looked at by the Government, and I am sorry that there is no Treasury Minister here to wind up, for this is primarily a Treasury matter. It has to be understood that in this new situation we cannot rely on the charitable organisations to do the job to which this House ought to be attending and to which local government ought to be undertaking. We have a duty to help organisations that are helping the people outside.

6.10 p.m.

Mr. Robert Boscawen (Wells)

I agree with the hon. Member for Kingswood (Mr. Walker) that one of the most disquieting manifestations of the present inflationary situation is the way in which it hits those who are most in need of help. Because inflation hits the charitable organisations and the voluntary services, it hits those who are helped by those services. That is one reason why we have to do something about inflation, but that is not primarily the purpose of the debate today.

I am encouraged that we should have had the debate at this time of crisis, and that we should be considering the people who give so much of their time, effort and energy to helping those who are less fortunate than themselves. It is encouraging that my hon. Friend the Member for Sutton Coldfield (Mr. Fowler) has been instrumental in bringing about the debate at this time.

I was also encouraged by the speech made by the Minister of State, Department of Health and Social Security who is responsible for the great professional service which is charged with looking after health and social welfare. I was pleased that he readily supported the view that that great professional service has many gaps which can be filled only by the individual—not necessarily specially trained—devotedly giving up his time, energy and effort to helping where he can. What is important is to keep up the moral of the voluntary workers.

It is true that the voluntary organisations are in considerable difficulties because of financial stringencies and rising costs. It is also true that there is no shortage of troops on the ground in the form of volunteers who are prepared to do the work. There are certainly more volunteers among the younger generation these days, and that is one of the most encouraging signs. The parts of the health service which look after the mentally sick and the severely disabled are often referred to as the poor relations of the health service, and it is in those areas that there is a great need for voluntary help to supplement the services provided.

I hope that the Minister of State, Home Office will tell us more about the work of the Voluntary Service Unit. I suggest to him that much of the work done by voluntary societies involves the dissemination of information about what Government Departments are doing to help people, especially those who are disabled or mentally handicapped. When those people come out of hospital they are lost in their new environment and desperately need advice. Often, that advice can come only from a voluntary society. It is my hope that the Voluntary Service Unit will enjoin the various Govern- ment Departments concerned to provide in the simplest possible terms information about the help that is available to individuals.

Those of us who take part in social security debates know how desperately complicated these matters are becoming. We see the leaflets that are put out by the Department of Health and Social Security, the Department of Employment, and so on. Because we are familiar with them, we may think that they are quite good, but voluntary workers who are not so familiar with the workings of Departments as we are, or as civil servants and professionals are, need the information that comes from the Departments to be in simple, sensible language. I hope that the Minister of State will persuade his colleagues to act along those lines.

The Minister of State, Department of Health and Social Security referred to the relationship between the paid social worker and the non-paid social worker. I will not call the paid social workers "professional workers", but I will use the words which the Minister obviously chose with care. That relationship has improved greatly within the past few years. In some area health authorities the relationship between paid social workers and volunteers is extremely good, and there is a spirit of trust and understanding between them. The paid social worker recognises that the volunteer has experience and common sense to bring to the matter in question that the paid professional worker may not have, and the volunteer worker has trust and confidence in the training and the professional competence of the paid worker, There are, however, areas where that trust still does not exist. Nothing is worse for the morale of a voluntary worker than to feel that he is not wanted by the professional worker in local government service or in whatever statutory body is involved.

I hope that the Department of Health and Social Security and the Department of the Environment will give a lead, as the Minister of State gave this afternoon to those who work under him. The Departments need the help of voluntary workers, and it is up to them to show the voluntary workers that they are wanted and to encourage them. In that way the morale of the voluntary workers will automatically be raised.

All in the voluntary services is not so black as some people paint it. I was immensely encouraged to read last week the report by the Chairman of the Wells Youth Club in my constituency. He exemplified what many of us who take part in voluntary work feel in these words: Times are not going to be any easier in the immediate future; we are not likely to find a fairy godmother to wave a magic wand and banish all our troubles. I am not trying to paint a picture of gloom, merely to be realistic. Hardship is not going to stop the work of this centre; rather it is going to bring the people together and make our work more important. That is the spirit in which we should tackle the work. That is the spirit that is necessary for voluntary services and voluntary workers, and it is, I hope, the spirit behind the debate.

6.18 p.m.

Mr. Richard Crawshaw (Liverpool, Toxteth)

I regret that I was not here when the debate started, but I do not apologise because I was attending a national executive meeting of the NSPCC. Hon. Members will not be surprised to know that one of the items on the programme concerned how the society would be able to carry on its work over the next few years, despite the generous help which has been given by the Government. The difficulty that any Government experience in dealing with voluntary organisations is to achieve the fine balance of giving sufficient help to keep the organisation going without eroding the voluntary spirit which is so necessary for most societies.

When I was connected with the youth services in Liverpool, one of my main aims was to ensure that every youth club had a full-time trained leader, because that was thought essential for the proper running of a club. Ultimately most of the clubs got a full-time leader. One might think that that was a good thing, but unfortunately, the club having got a full-time paid leader, everyone else who worked in the club expected to get paid something for his or her services. Even the people who provided the tea ultimately had to be paid to come in to prepare it. In my view, this is an erosion of the volunteer spirit which this country has been proud of for many years. By giving too much money in the wrong places we can do more harm than good to the voluntary services.

I now turn to some of the difficulties which are experienced by the voluntary services and which have already been mentioned. When we argue that they should be excluded from VAT, the provisions of the Community Land Bill and so on, the difficulty is that there are so many of these charities. I want to reinforce the suggestion that there should be a special register set up but not just for charities. Every organisation that applies to be put on the register should be vetted and only a limited number should be allowed to go on it, and once they are on it, they should get the benefit of relief from VAT and so on. I do not believe that it is possible to give this relief to the number of organisations that are registered as charities, because some of them are very dubious in nature. I do not think any Government could give a carte blanche guarantee that they will exclude all charities from these particular types of taxation.

The other matter I want to stress to the Government is that it is in the Government's interest to ensure that volunteer organisations are kept going. So many of the organisations which have been started for the good of the country have been pioneered by voluntary organisations. For example, the formation of units known as non-accidental injury to children, or, in common parlance, battered child units, are being pioneered by the NSPCC, but one of the points raised today was: how can it manage to keep paying for these units when the help that is being given at present is withdrawn by the Government? Can any Government really say that, having set up these units, and day by day becoming more aware of the problem of the battered child, they would allow these units to go out of existence? If they do, they would be saddled with the whole burden of running these units. I ask the Government to look at this matter and try to help without doing away with the volunteers.

I should like to make a criticism. I see a great deal of social work being carried out by volunteers in large institutions such as the Royal National Life Boat Institution, the NSPCC, and so on. The volunteers claim no expenses for using their cars. They also pay for telephone calls, but they never think of charging a halfpenny to these organisations. That is the true volunteer spirit. We are seeing the growth of so-called social community workers. Every halfpenny out of their pocket is put on a pad and every telephone call is registered. Every allowance which can be claimed is claimed for every extra half hour's work and so on. This is a retrograde step. There is a great need to return to many of the volunteer workers who have been displaced by some of these social workers.

I have seen many clubs which have gone out of existence or which were going out of existence because they could not find a few hundred pounds. Often the local authority stepped in and spent hundreds and hundreds of pounds more than ever before on unnecessarily making premises more lavish. This is a retrograde step.

I believe that perhaps this economic crisis will bring the resurgence of the volunteer spirit which for so many generations has given this country the lead in bringing out reforms which have been vitally necessary for our society.

6.24 p.m.

Mr. Toby Jessel (Twickenham)

It is a pleasure to follow the thoughtful speech by the hon. Member for Liverpool, Toxteth (Mr. Crawshaw), not least because of his well-known activities in the NSPCC, including his walk two or three years ago which I believe covered 255 miles and took over 76 hours. His was a most impressive performance, but I do not wish to disparage the efforts last weekend of my hon. Friend the Member for Shoreham (Mr. Luce) and, of course, Mr. Speaker. We have not all got quite the same stamina for these things. My hon. Friend and Mr. Speaker certainly did better than most of us could have done.

I agree with the hon. Member for Kingswood (Mr. Walker) that it is regrettable that there is no Treasury Minister present, because the fiscal side is surely highly important for charities. We have the absurd situation today in which a children's home that is run by a local authority is zero-rated for VAT purposes, but a children's home run by a charity, such as Dr. Barnado's, has to pay VAT. One cannot possibly justify this on any rational ground whatsoever. I hope that the two Ministers of State, from the Home Department and the Department of Health and Social Security, whom I see on the Government Front Bench will make strong representations to the Treasury about this matter.

Despite the aid that has been given, I believe that charities have never had it so bad. Their work is hampered and frustrated not only by rising costs in these inflationary times and by falling real incomes but by a drop in donations and by a squeeze on spending by local authorities. It is quite wrong that they should be additionally penalised by taxation which seems to be unnecessary in the sense that the total sums involved are extremely small. If there could be some concession in this direction, the work of charities would substantially benefit.

The voluntary services fill a gap that the State is unable to fill. One or two Labour Members have said that in their early days they flirted with the notion that the State or the local authority should be the sole provider of social needs, but they have since rejected that point of view. That is quite right, although it is a view that is still taken by some people. Of course, the Government must be the basic and prime provider of social services in a modern country, but I believe that the scope for voluntary services remains virtually unlimited because there will never be enough State or local authority resources to provide for all the social needs that exist at any one time. There will never be enough State resources, for example, to provide sufficient extra comfort for the old, the sick and the handicapped. There will never be enough State resources to deal with the problem of lonelines among old people. There will never be enough State resources to provide skilled counselling on a large enough scale for people like alcoholics, discharged prisoners and other minority groups with special problems.

I believe that the voluntary services should receive the maximum possible support—not only moral but fiscal—from the people of this country and that Parliament and the Government should give a lead. We should all express our gratitude for what is done by charitable bodies throughout the country, both at headquarters level and through their numerous branches of supporters.

6.28 p.m.

Mrs. Lynda Chalker (Wallasey)

Everyone will agree that this has been both an interesting and worthwhile debate. It has been full of new ideas. We have heard some excellent speeches. However, it is not just a question of money. We all know that cars do not run without petrol. Voluntary organisations do not run without money, but they also do not run without the good will and the voluntary effort that we have heard so much about today.

The Opposition take the view that it is particularly notable that in times of greatest inflation the people who are hardest hit need the voluntary services more than ever. That is one reason why the Government must, at this time of high inflation, make sure that they protect as much as possible the people who are hardest hit. We only have to look at the example of housing stress and the 10,000 people who went to the Housing Aid Centre in 1974 for assistance—this was just one centre in one part of London. They were saying "Please help, we do not know what to do." So we realise that this is an increasing problem. The crisis is not confined to the voluntary organisations. It is a crisis for all of us. The voluntary organisations are among our few remaining hopes for encouraging self-help in society. As my hon. Friend the Member for Twickenham (Mr. Jessel) has said, we shall never have sufficient State resources to do everything that needs to be done. I am glad that this is so. I was glad to hear the Minister say so in his opening remarks.

I wish to dwell briefly on the activities of the voluntary societies first in the unpopular areas such as drug and alchohol abuse. There are young people from the St. Mungo's Trust who go out regularly to give hot soup to people sleeping under bridges and on park benches. This is not the pleasant side of life. It is an aspect with which only the voluntary societies can deal. They are also active in assisting people with psychiatric problems, especially those who have returned from an institution and are trying to re-establish themselves in the harsh outside world. Very often these people succeed only as a result of voluntary effort.

Voluntary societies are not just an adjunct of society but an integral part of a society which is caring and compassionate, and which we should be seeking to encourage in all our fiscal and legislative processes. We must remember not only those who are helped but the helpers. People derive an enormous amount of satisfaction from voluntary effort. It is a little like a stone being thrown into a pool of water. From the ripples the stone makes, friends see what satisfaction people have had as a result of helping someone else. It is a spur to a higher standard of care not just on the voluntary side but also in the statutory provision of services.

There is another vital reason for safeguarding the future of voluntary societies. They seem to manage to adapt to change faster than statutory bodies. If they fail to do so, another group starts up and replaces the original group. It was interesting to hear, in the commendable speech of my hon. Friend the Member for Liverpool, Wavertree (Mr. Steen), what a tremendous amount of good is being done in developing neighbourhood work and of the wealth of opportunity for voluntary organisations.

There is also participation by the nonprofessional in what was once the closely guarded professional world. This helps in an understanding of social change. I well remember that when a local hospital was closed down in South-West London the proposal was made that a hostel should be established to care for people who had alcoholic, mental and drug problems. There was a great outcry at the start, but after a few months, when some of the people in the neighbourhood had gone into the hostel to do their bit, the whole matter settled down. The ripples in that pool spread far wider than any of us would have imagined.

In the voluntary societies we have perhaps the finest example of the kind of service which a statutory body can never provide. The voluntary societies provide the person-to-person help in times of extremity. This is nowhere better illustrated than by the Samaritans, who are at the end of a telephone to help people in dire need. It would be impossible for our statutory services to afford to pay for such a service, which is also provided by many other organisations. Above all, these voluntary bodies appear to be able to do things on a cheaper, though no less good, basis.

I have often spoken in this House of the plight of the disabled. We all welcomed the Chronically Sick and Disabled Persons Act 1970. It has taken a voluntary organisation, the Outset Organisation, to survey 10,000 people to obtain the basis of the information which is required by that Act. The interesting thing is that the cost of the survey was about £1,000. It does not need a market researcher to point out that that is a cost-effective way of gleaning a lot of information. Here again is another example of a voluntary body playing a full part alongside the statutory body and being, pound for pound, truly cost-effective.

The other reasons why I am so concerned that voluntary bodies should survive are probably ones in which I should declare an interest. The voluntary organisations, be they called pressure groups or whatever, provide pressure points on our legislation. They provide a valuable briefing to back benchers and Oppositions when we have no Civil Service to support us. There is no doubt that the organisations that have been active recently on the Children Bill have exerted themselves in a fantastic way. There have been over 102 pieces of information and bits of evidence on one Bill dealing with one subject.

There is a cross-fertilization of ideas arising from these voluntary organisations. A lawyer who is normally engaged in a mundane practice looking after transfers of land and so on may be able to bring his experience to bear in quite another walk of life. Utilising specialists from different walks of life must be one of the ways in which the voluntary bodies continue to survive. We have heard about the NSPCC. We must remember that it came into being with two purposes, to alleviate suffering and to secure legislation for child protection.

I see here the need for a partnership between the voluntary organisations and the statutory bodies. We have had many debates on the latter. I want to use a mnemonic to bring home the plight of these voluntary organisations. I use the initials "DIG" because they sum up very well what I mean. "D" is for the despair which the societies feel at the moment. The directors of voluntary organisations are trying to keen their staff going but they cannot pay union rates. They are becoming full-time fund-raisers instead of problem-solvers. They literally have no more midnight oil left to burn. They do not know where funds are to come from.

Nearly 50 per cent. of SHAC's funds are in the third year of a three-year grant. It wonders where it will get housing aid from next year. We have heard of one charity after another cutting staff. The new postage rates have increased the burden of Help the Aged by £50,000 a year. That money would provide five sheltered housing schemes each for 40 elderly people. Local authority cuts are coming. This is worrying voluntary organisations. This is at a time of increased need and increased despair.

"I" is for indignation. The voluntary organisations are acting as unpaid tax collectors and not just for VAT, although this is the obvious tax to the man-in-the-street. The League of Friends in the local hospital, running a shop trolley, has to keep six separate records of tax categories for the benefit of the taxman. Since re-organisation local authorities have not managed to sort out rate relief on premises used by voluntary bodies for giving information to the public. This is a crippling burden on many local societies and one which we could cure. Most people in voluntary bodies are working for lower wages, often not claiming their petrol allowances because they know that the organisation cannot afford to pay them. They feel, despite all that, with all the hours that they put in and all the work that they do, that they will be squeezed out of existence.

I come to the letter "G" in the word "DIG". I referred to the despair and the indignation. I now refer to the Government response. I welcome the remarks made by the Minister of State, Department of Health and Social Security. The crisis has welled up in the past 12 months. We look to the Government for some response. We heard many well-meaning phrases in another place, but not one inch was given.

Many problems should be looked at. The Minister said that the Government would look more seriously at the working of the EEC Social Fund. I am delighted to hear that. However, we need something more immediate than "the years"—those were his words—which it will probably take for this country to receive full benefit from the social fund. Is it possible for the Government to issue to local authorities a guidance circular containing information from the volunteer centre saying that local authorities should not cut the small and least known projects as the most important work in a community may be carried out under those schemes?

Is it possible for us to benefit from the experience contained in the recent Volunteer Centre report "Bargain or Barricade" about the good and bad use of volunteers and make sure that the local authorities know the best way to make their cuts this autumn which least hurt the community?

The volunteer centre, through the local councils of voluntary service—many of which, regrettably, must still be reactivated—can embark upon a programme with local schools to discover where the volunteers can best be used. At present there are only 130 volunteer centres, although that is an improvement compared with the 28 centres which existed three years ago.

We cannot afford the weakening of voluntary organisations. We must take steps to ensure that they are not weakened at the national or local levels.

I am sure that the Minister will find acceptable the analysis which was made this evening by hon. Members on both sides of the House. There is a logical sequel. The Government should give the highest priority to the rescue operation and to the settlement of the VAT question, which has been discussed since its introduction into this country. The Government can help with the urgent grant situation, by increasing some of the activities of the volunteer centres and by encouraging more people to work on the problems which hits us hard now.

Professor Titmus said that giving was instinctive and sometimes impulsive. He spoke of the gift relationship. He said that it was part of living. If we do not increase our gift relationship the voluntary organisations will not continue to live. They are in danger of dying. For that reason the Government must give every possible encouragement to the development of the gift relationship both by their own example in encouraging voluntary activity—although that cannot be done without the necessary funds—and also by encouraging the development of gift relationship in the community.

6.44 p.m.

The Minister of State, Home Office (Mr. Alexander W. Lyon)

I agree with the hon. Member for Wallasey (Mrs. Chalker) that this has been an interesting debate, which was free for the most part, with one notable exception to which I shall come later, from any dogmatic abuse between the two sides.

We are all agreed that the rôle of the voluntary organisation is as essential now as it has ever been. My hon. Friend the Member for Mitcham and Morden (Mr. Douglas-Mann) indicated that at one time he was ambivalent in his opinion on this question. It may be that his feelings were shared by other members of the Labour Party and by those outside the House in the early days of the Welfare State. I should like the time to come when the Welfare State would apply resources over such a wide field that there would be no need for the voluntary movement. As the hon. Member for Liverpool, Wavertree (Mr. Steen) said, we have seen such an expansion of expectation of the social services that it never will be possible—it never has been possible—for the State to meet the need wholly.

Indeed, we have found that, contrary to his analysis, human beings were not deprived of the will to help by the existence of the Welfare State. On the contrary those people have found an increasingly active rôle in assisting the social services at many levels. The burgeoning of voluntary organisations is one of the most interesting aspects of the past 20 years. There are now far more people involved in voluntary work of one kind or another than ever before. Clearly, therefore, there is no dispute that we need to keep that spirit going through the next two or three difficult years. Everyone—I include the Government—is anxious to do that.

The hon. Member for Sutton Coldfield (Mr. Fowler), who opened the debate, rightly stressed that he could not ask in these circumstances for increased public expenditure to assist the voluntary organisations over this hump. I do not think that the point was taken by the hon. Member for Wallasey, who wound up for the Opposition, and who seemed to ask for just that. Clearly, it would not be possible for us, in the present economic climate, to raise the level at which the Government can assist voluntary organisations. My hon. Friend the Minister of State, Department of Health and Social Security gave figures in opening. We have done three times as well as was expected by the previous administration. We cannot expand that at a time of extreme stringency in public expenditure.

Equally the same argument applies to the calls we have received to reduce the incidence of tax either upon charitable organisations or upon the voluntary organisations which are not charities. As my hon. Friend the Member for Mitcham and Morden conceded, if we make a tax allowance we shall increase public expenditure, since the two go together. We may not increase it by quite as much as if we had given 100 per cent. support for the activity engaged in, although the outcome depends on the donor's incidence of tax. If the donor pays 98 per cent. tax and makes a contribution to a voluntary organisation which claims tax relief, it may he said that the State is making a contribution.

We accept that the voluntary organisations face a testing time. We are doing all that we can to assist. The Home Office Voluntary Services Unit is a liaison body for all Government Departments. It has a liaison officer in each Government Department with the objective of co-ordinating the rôle of Government policies in relation to the voluntary organisations, and to try to help voluntary organisations to get the best out of the Whitehall machine and not to be bogged down in unnecessary bureaucratic procedures. The unit gives advice, on request, to voluntary organisations. It also has a small amount of money which it can use to help voluntary organisations. It has considered the priorities to be applied in these difficult times. As was announced, it has decided that it must first meet the existing commitments, and secondly that it must make grants to projects and organisations of high social priority which are threatened with financial failure. Within this House, however, it will be possible to help only those organisations which come within its remit. Only then can it think of supporting plans for new services or for the expansion of existing ones.

The Voluntary Services Unit is faced with the same choice to be made by the Government, by local authorities and by the relevant voluntary organisations. The question for us, as was pointed out but not plainly answered in the debate, is that the pressure of economics is now applying to the voluntary movement the problem of priorities which it should have faced up to many years ago.

It is bound up to some extent with the argument, which was advanced on both sides, about a revision of the law on charity. I have been involved in this for many years. I tried to persuade the previous Government to set up a further study of the law on charity. It is not true that the law on charity has remained unchanged since the seventeenth century. In fact, the Nathan Committee which looked into this matter in the 1950s produced the Charity Act 1960, setting up the Charity Commission, which was intended to rationalise at least the procedure of charities. We are now awaiting Lord Goodman's report to the National Council of Social Services on what he thinks the future law ought to be.

Bound up in this argument is the question of which organisations ought to be regarded as charities, and, therefore, get Government assistance, and which ought not. The only purpose of being a charity these days is to get a tax allowance. The difference between one organisation and another is sometimes very difficult to define and I look forward to Lord Goodman's adumbrations on this subject. When I tried to do this job myself in 1957 I found it extremely difficult to make a judgment between what was a public benefit trust and what was not.

With the restricted finance now available charities must come to terms with what they need to keep and what they can get rid of. They can do this in a planned and orderly way or in a rushed way as a result of the high rate of inflation forced on them. To make cuts just for the sake of saving more money would not be a sensible way of looking to the future; when resources do become available again, they would have to restore an organisation which might have died.

Every encouragement is given to voluntary organisations to share their overheads—for instance, by renting the same premises, and there are two interesting experiments taking place in Newcastle and Manchester. We must ask whether it is necessary that there should be four or five organisations in an area all doing the same kind of work or whether they ought to see if they could do the job together, sharing out scarce resources in a much more meaningful way.

I thought the only churlish speech in the debate was made by the hon. Member for Liverpool, Wavertree, and considering his distinguished record on this subject I thought he was notably uninformed. The position of charities and non-charities has been written into our law for a very long time. When I first came into the House I had a long argument with my own Government about whether selective employment tax should apply to charities. We got charities removed, and that was when I first got into the argument about what is or is not a charity. The same argument applies to value added tax under the Government which the hon. Member for Liverpool, Wavertree supported. They did not make concessions to organisations that were not charities. It is difficult to distinguish between a voluntary organisation that is for the public good and another that is not for the public good. That is the inhibiting factor when we approach the question of charities.

Mr. Steen

The financial arrangements under the present Government are a penalty to voluntary organisations. Under the previous administration, organisations, whether charitable or not, received benefits from changes made in estate duty provisions. This is one area in which the present Government have made the situation worse.

Mr. Lyon

The Government are stopping up the loopholes in relation to death duties overall. Inevitably, if an organisation does not get the benefits of the concessions made to charities it will be hit by this tightening up, but this is not directed at the voluntary movement, but against the inequities of a tax which was not effective. We made concessions for charities under the capital transfer tax and propose to make concessions in rela- tion to the Community Land Bill. We have been made well aware of the need for concessions by the Churches and other charities and an announcement will not be long in coming.

Mr. Norman Fowler

We are glad to hear the Government have been aware of the problems for a long time, but even if a concession is made the voluntary organisations will have spent a great deal of time and money fighting for the change. Why could it not have been done at the begnning?

Mr. Lyon

For the same reason it was not done with VAT under the hon. Gentleman's Government. The complex legislation produced by a Government is subjected to the criticism of bodies it affects—in this case charities—and the Government have to make concessions to meet the legitimate demands of charities. I do not accept that there is anything different in the way this Government approach the matter from the way in which the hon. Gentleman's Government approached it.

Before concluding, I should like to say something about the grant to the NAYC and the rôle of the European Social Fund. The total grant to the NAYC was £1,200,000. It was not a question of taking the whole of the £600,000 grant available to that organisation. Application was made for 50 per cent. of the grant to the fund and it was paid to the Treasury which had paid out the £600,000 to the NAYC. The attitude that has so far prevailed—and this was ordained by the previous Government—is that the Government make a lump sum application, within the criteria, to the European Social Fund for all the payments it has made to voluntary bodies that fit the criteria. The Government take into account any applications made through the Department of Employment for grants to voluntary organisations. However, there appear to be anomalies about the position and we intend to investigate the matter more closely.

The only matter which has not been raised in the debate is the distasteful question of help which might be given under the new Lotteries Bill. I have a personal disinclination to this method of obtaining finance. I have always thought it better that society should make a coherent allocation of resources to voluntary organisations rather than that they should get it in this haphazard way. The opportunity is there.

Finally, I wish to stress the point, which was made by my hon. Friend the Minister of State. Real help for the voluntary organisations, if they are to continue on a voluntary basis, must come from the public. In the end it must be the public who help the voluntary organisations through the difficult crisis. That means that the public have to raise the level of their donations. On the basis that only 35 per cent. of the population are contributing in any way to the voluntary section, if that proportion went up to 50 per cent, another £20 million would go to the voluntary organisations. That shows what can be done if a larger number of people will give. If those who give at the moment were to increase their giving as their incomes increase that, too, would help to meet the inflationary spiral which the voluntary bodies face. Overall we recognise that there will be difficulties, and the Government will make it their policy to do all they can to assist the voluntary organisations in this.

Mr. Joseph Harper (Comptroller of Her Majesty's Household)

I beg to ask leave to withdraw the motion.

Motion, by leave, withdrawn.