HC Deb 26 June 1987 vol 118 cc226-34

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

2.30 pm
Mr. Tony Banks (Newham, North-West)

While hon. Members are clearing off, I will congratulate the Parliamentary Under-Secretary of State for the Environment on maintaining his position in the Department of the Environment. Not everyone was so successful. He has managed that and will no doubt be appearing on other occasions during the next four years defending the indefensible in the way that he always does. No doubt Opposition Members will approve the comments made by the Minister's hon. Friend the Member for Ealing, Acton (Sir G. Young). The hon. Member for Acton said that all the great difficulties experienced by the Government have been on local government matters. The Government have clearly learnt nothing from the past eight years and are set fair for a rerun of past battles.

Great play was made during the course of the general election campaign about the need for policies to deal with problems in the inner cities. Towards the end of that campaign the Prime Minister specifically referred to such problems on several occasions. Indeed, there was mention in the Gracious Speech about policies for the inner cities.

I do not know why Ministers bother. If they only asked Opposition Members we would be able to tell them—as we have been telling them over the past eight years—all about the problems within the inner cities. I do not need to be a soothsayer to recount the problems. They are unemployment, poor housing, the high crime rate, general levels of poverty, vandalism, inadequate transport and, most of all, no hope. One of the greatest poverties that afflict the inner cities is the poverty of expectation. People have now reached the point where they expect very little or nothing and they are rarely disappointed because little or nothing is what they get from the Government.

The Government have created or exacerbated all the problems of the inner cities that I have just listed through constant attacks on local authorities and especially Labour-controlled local authorities and through the steady removal of central Government financial support through the rate support grant. Through the discriminating policies pursued by the Government since 1979 they have shaped the misery of our inner cities until many are now primed and ready to explode. Even the Government must now realise just how far they have gone. They must realise that they have gone too far and are worried about the increasing threat of social disruption within the inner cities. Having created a crisis they are now trying to gain a level of political credit by attempting to deal with the problem. Having considered the Gracious Speech and having heard the statements made from the Conservative Benches and during the election campaign, I believe that there is only one way in which the problems of the inner cities can be dealt with, and that is through the provision of more resources.

The Prime Minister said that problems cannot be solved by throwing money at them. However, problems cannot be solved by continually taking away money and resources. The Minister must bear that in mind. Resources, resources and more resources are the three things needed for the inner cities.

Central Government have steadily withdrawn support for inner city services and the voluntary sector has done its best to deal with the consequential problems. In London today the position of the voluntary sector is serious, and was made considerably worse by the abolition of the Greater London council. In its last year of operation the GLC funded about 2,500 groups to the tune of £82 million. As well as providing financial help, it attempted to develop a strategic approach to awarding funds by identifying areas of need both by client group and by geographical area.

The voluntary sector in London as elsewhere was understandably concerned about the abolition of the GLC and the metropolitan county councils. Indeed, in the face of widespread opposition the Government were forced to make substantial concessions. For example, the Government's contribution through transitional funding was quadrupled from £10 million to £40 million, and the original ceilings envisaged for collective funding of cross-borough or district projects by local authorities were removed. Those concessions were won from a reluctant Government, but they are simply not enough. London's voluntary sector now faces serious problems in maintaining its vital contribution to meeting the needs of Londoners.

There are various pressures on voluntary sector funding, and I shall shoot a few points at the Minister as I normally do. If he cannot reply in his summing-up, I know that he will continue to write to me. I want to ask him about the Government's attitude to urban programme time-expired schemes. We know that the Government have made an agreement about tapering arrangements, but the schemes throw, and will continue to throw, greater burdens on local authorities. There are also the special programme time-expired schemes. There have been a number of specific Government initiatives over recent years, one of which was the under-fives programme, but those projects are now expiring. However, the projects themselves will not just go away. Government support might go away, but the schemes will again look to local authorities to come in with additional funding. There are also the Manpower Services Commission schemes, with continuation and top-up.

Another problem area to which I should like the Minister to direct his thoughts is the European social fund and the way that voluntary sector funding from the ESF fell by over 30 per cent. in 1986. That created more demand on local authorities. A book called "After Abolition" was published by the National Council for Voluntary Organisations in conjunction with the London Voluntary Service Council. If the Minister has not seen it, his civil servants will certainly have seen it. The book came out in January 1987 and made 20 major recommendations. It was the subject of a debate in another place in May. At that time the Minister who summed up, Lord Skelmersdale, said that the Government would respond to the 20 recommendations in that report. Can the Minister tell us by what date the Government will respond to those 20 points?

One of the big areas of trouble in London in terms of the voluntary sector is the Richmond scheme, the London boroughs grant scheme. Last year it took the boroughs three months to agree a budget. This year it is even worse. In late November 20 boroughs agreed a proposal for expenditure of £32 million but ratification by two thirds of the boroughs is required. That means that 22 boroughs must agree. Despite many meetings, no agreement was reached until the middle of March and that came only after the Secretary of State had said that he was minded to set a limit of £28.5 million.

There was a great deal of uncertainty and a feeling of impending chaos about all this delay. Voluntary groups were faced with the prospect of having to lay off staff and close their doors on 1 April, the start of the new grant year. Even now, two months into the financial year, 150 to 200 groups in London do not know whether their funding will be renewed, and are currently surviving on three-month contingency funds. This is highly unsatisfactory and I am sure that the Minister recognises that. What proposals will he bring forward to make sure that the Richmond scheme operates more efficiently and effectively than it does at the moment? Perhaps a change in the two thirds majority would be of some assistance.

One of the serious problems that the scheme has thrown up is the inability of the scheme to award capital funding because section 48 of the Local Government Act 1985 makes no allowance for the collective funding schemes to have their own capital allocations. Although the committee of the Richmond scheme has pressed the Department of the Environment to provide the scheme with its own capital allocation, it has not met with any success. The bid for capital funding this year is about £12.75 million. During the past 12 months I have repeatedly asked the Minister whether the Government will make such changes to allow capital allocations to be made. Again, I should like the Minister to advise us on any further thoughts that he may have had about that problem.

An associated problem is the premises that are owned by residuary bodies. The London Residuary Body has more than 50 properties that currently house 123 voluntary groups. We know that the London Residuary Body is required to dispose of those properties at the best price that it can and to return the money to the London boroughs. However, many of the voluntary groups that are housed in those buildings pay only peppercorn rents and, given the lack of capital grants in the Richmond scheme to which I have already referred, the prospect of finding replacement premises will make their position wholly untenable.

The Secretary of State has the power to direct the London Residuary Body to do whatever he wants it to do. I put it to the Minister that under the 1985 Act he has the power to say to the London Residuary Body, "Transfer those properties that at the moment house those 123 groups to the boroughs so that the voluntary groups can remain there and continue to follow their projects from those buildings". There are plenty of precedents. The Secretary of State is currently directing the LRB in respect of Thamesmead. Therefore, there is no reason why he could not do so in respect of the 50 properties that I have just mentioned.

Transitional funding was designed to cushion the impact of funding local groups serving one borough and the Minister knows as well as I do that it is available on a taper basis. However, the point is that none of the problems go away. The Government are withdrawing themselves. That is the idea of the taper. Clearly, those groups turn to the borough council and say, "We are losing more Government money. What will you do?" The taper means that the boroughs and the Inner London education authority must find an extra £4 million this year. Some boroughs are especially hard-hit. Camden needs an extra £406,000, Hackney needs an extra £356,000 and Lambeth needs an extra £347,000. The Government should adopt a more flexible attitude to the tapering of their contributions. If it is not possible to maintain the 75 per cent. contribution across the board, the Government should at least allow extra contributions in those areas that are especially hard-hit. Again, I should like the Minister to advise us of his proposals on that.

We discussed section 137 at great length during the process of the abolition of the GLC and the metropolitan county councils. Abolition halved London's section 137 allowances. Despite the fact that doubling the limit for the boroughs was the only recommendation for immediate action in the Widdicombe report, the Government have so far refused to use their existing power to raise the limit. I remember that during the long hours in Committee on the 1985 Act Ministers said that if it was shown that the halving of section 137 would have a deleterious effect on the voluntary sector in London the Government would do something about it. However, they have not done anything about it. I should like the Minister to inform us exactly when an announcement is planned. In the debate in another place to which I have already referred, Lord Skelmersdale said that an announcement was pending.

The outlook for the voluntary sector in London is depressing. There is genuine fear that insufficient money will be available to consolidate existing services and that nothing will be available for new developments. There are major gaps in voluntary sector provision. There are, for example, still eight boroughs without the equivalent of an alcohol advisory service. The Government should think about that because I understand that there will be legislation for all-day licensing. No doubt that will mean that alcohol advisory centres will be that much more needed in the London boroughs.

London has a shortfall in its provision of advice centres. It has 14 per cent. below the national minimum. Some boroughs are especially poorly served and 14 have no specialist advice or law centre. Some advice needs are inadequately met. There is a 55 per cent. shortfall in the provision for housing advice. In addition, many agencies need more funds to support their core activities. In the mental health field alone, an estimated 10 per cent. increase in funding is necessary to stabilise current activities.

Central Government and private sources have invested large amounts in capital funding, which cannot be put to community use until staff are employed. That is a nonsense which even the Minister will recognise. It is especially true in housing. A need of £1.8 million has been identified to ensure that about 1,600 bed spaces provided through shared housing, hostel and care in the community schemes can be used. There can be no more crying need for such housing provision than in London. At present, about 7,000 families in London are housed in bed and breakfast accommodation, at enormous cost to the London boroughs. In Newham, homelessness is growing faster than in any other part of London. It is crazy that we cannot provide, through the voluntary sector, the bed spaces which the Government's contribution on the capital side has allowed.

The need for more resources for the voluntary sector is reflected in the demand for new funding from the London boroughs grants scheme. In this financial year, 206 new applicants applied for funding from the scheme, and the total bid for funding is almost £57 million. But the budget set by the Secretary of State was £28.5 million.

The demand in the voluntary sector is enormous, because the Government are inflicting an ever-increasing burden on the voluntary sector through their continual removal of resources. With regard to the provision of statutory services, they are transferring the burden continually from the statutory to the voluntary sector. Therefore, the voluntary sector in London has a right to say to the Government that, because the Government are exacerbating the problems experienced by the voluntary sector, they should provide the extra funds which we all know are desperately needed.

2.46 pm
The Parliamentary Under-Secretary of State for the Environment (Mr. Christopher Chope)

I thank the hon. Member for Newham, North-West (Mr. Banks) for his kind comments. I always enjoy our encounters across the Chamber. Indeed, during what was almost the last Adjournment debate of the previous Parliament, we debated the position after the abolition of the GLC. I have not checked the Offical Report, hut I recall that the hon. Gentleman was buoyant about the prospect of the Labour party doing well in London. We can now see that the predictions by me and by the Conservative party that the electorate would endorse the Government's policy of abolishing the GLC were more than vindicated in London. What is now called the "London effect" gave the Conservative party a bigger swing in London than in many other areas.

Mr. Tony Banks

I have the safest seat in London.

Mr. Chope

I do not dispute that. That is why the hon. Gentleman can speak more frankly from the side of his party for which he speaks than can some other hon. Members.

I congratulate the hon. Gentleman on featuring in today's Daily Express, where he is described as an old hand. I am sure that he will appreciate that description of him in a newspaper that has not always been to his liking. He is certainly an old hand at these Adjournment debates.

The voluntary sector in London is important. The Government take the voluntary sector extremely seriously and have an exemplary record of support and encouragement for that sector, but we do not believe that just because something is in the voluntary sector it is automatically desirable. The list of organisations funded by the GLC which were voluntary by description, but not necessarily by nature, is evidence that many of those organisations should never have been funded, whether they were voluntary or not, and that we should concentrate on the worthwhile side of the voluntary sector and give even more emphasis to the role of the volunteer. Much of the Labour party's policy is directed towards the role of the full-time worker in a voluntary organisation. We must encourage more true volunteers to give their service to local communities, especially in the inner cities.

Perhaps I can remind the House of the answer given on 2 March 1987 by my right hon. Friend the Prime Minister when she was asked about Government support for the voluntary sector. She said that, in 1985–86, the last year for which data were available, grants and payments to the voluntary sector by Government Departments amounted to £268 million, which represented an increase of 208 per cent. since 1979. That is an increase in real terms after allowing for inflation and it is quite separate from the payment of £500 million made to voluntary organisations under various employment programmes run by the Manpower Services Commission. This is a record of which the Government can be proud and for which we should be given credit. Indeed, we were given that credit by the electorate in the recent election.

The hon. Gentleman referred to a number of specific points and those with which I do not deal in my remarks I shall, as in the past, do my best to respond to in writing.

The hon. Gentleman referred to the problems associated with the Richmond scheme. This is a scheme whereby the London boroughs grants committee funds bodies whose activities are of benefit to an area larger than one borough. It continues, for the second year, to distribute its not insubstantial budget of £28.5 million. The Trust for London has received its endowment of £10 million, promised during the passage of the abolition Bill, from the sales of the assets of the London Residuary Body. That endowment has been invested and the first distribution of grants from receipts is expected later this year.

With regard to the Trust for London and the London boroughs grants committee, I am the first to acknowledge that, earlier this year, there was uncertainty because the London boroughs grants committee could not fix a budget. Indeed, that uncertainty was great, since a number of staff redundancy notices has been issued. Because of the timely intervention of my right hon. Friend the Secretary of State and his proposal to issue and order to limit the budget to £28.5 million for 1987–88, a budget at that figure was agreed extremely quickly. The hon. Gentleman is not correct to say that that budget was imposed by the Secretary of State, as I understand that it was agreed by the London boroughs grants committee. It concentrated that committee's mind and it is a pity that the committee was unable to reach such an agreement earlier in the year, as that would have removed much of the uncertainty. It was that continued uncertainty that caused my right hon. Friend to intervene. He wished to restate the support of the Government for the voluntary sector.

The uncertainty has now been removed and the redundancy notices were not exercised. I understand that the committee continues to fund more than 800 groups. I have seen the list of those groups and I support many of them, but I am bound to say that I would not support them all. The Secretary of State has already made it clear that he is not necessarily happy with the present arrangements under which it may fall to him to intervene in the proceedings of the London boroughs grants committee. For that reason my right hon. Friend invited the committee to suggest alternatives, and that suggestion is not limited to members of the committee. We wait to see what response there is to that invitation.

Within the budget level the boroughs have, through the Richmond scheme, no doubt by careful husbandry, been able to start initiatives. At the same time, very properly, they have exercised their discretion and decided that funding for some bodies should stop. It is inevitable that the funding of each voluntary organisation should be reviewed. That allows scope for new organisations to be developed and for those that have not served a purpose to be excluded from funding in future years.

The hon. Gentleman referred to the position of those voluntary bodies that are currently in premises owned by the London Residuary Body. I believe that there are some 120 occupying about 50 premises. I believe that those voluntary bodies are expressing unnecessary alarm and disquiet. The LRB is discussing with the Trust for London the transfer of those properties to the trust, which is well placed to undertake this task, since the City Parochial Foundation, which manages the trust, has its own property management facilities and staff.

In this short debate it is worth referring to the Department's urban programme. The voluntary sector continues to perform an important role in our urban programme, which is now concentrated on 13 boroughs in London, including the borough which the hon. Gentleman has the privilege to represent. Newham was incited to submit an inner area programme for the first time for 1987–88. That programme contains seven projects from the voluntary sector. That is one half of the total bid and is in line with one of the objectives of the borough to encourage and support the activities of the voluntary sector in the borough.

Mr. Tony Banks

When will we get the money?

Mr. Chope

Nobody has reached a decision on all the individual projects. As I understand it, a decision is still awaited on the projects for which applications have been made. The delay was caused as the result of the general election——

Mr. Banks

The Government called it.

Mr. Chope

The hon. Gentleman was arguing at one stage that there should be fixed-term Parliaments. It was implicit in what he was saying that he wanted a general election pretty quickly. I am prepared to accept that as a result of the general election those decisions have been delayed, but we hope to be able to announce them quite soon.

It is worth drawing attention to the new emphasis that we are putting on the inner area programme, which is to provide funding for voluntary projects which involve an element of enterprise, training and job creation. Already two projects in the London borough of Wandsworth are receiving funds under the urban programme, which I shall describe briefly. The youth enterprise centre is a scheme to provide 22 sheltered low-cost starter workshop units in a disused building in Tooting for young people wishing to start their own business. It will also act as a base for various business support training agencies to provide on-site advice and back-up services. That is funded by the Department of the Environment, Wandsworth and a group of private sector companies, led by Esso.

There is also the Wandsworth training agency, which is a 300-place youth training scheme and a 150-place community programme scheme, funded jointly by the Department of the Environment and the Manpower Services Commission. It runs several training workshops in a wide range of practical skills, including electrical skills and computers. It also runs a placement scheme with local employers in construction, retail, clerical and community care. A wide range of vocational courses are also offered, including City and Guilds and Pitman.

It is to such projects that the Government hope that local authorities and local voluntary agencies will direct their attention during the coming months, because it is by providing a start in business and employment for people living in the inner cities that we shall be able to revive the areas that have not yet been revived.

I take issue with the hon. Gentleman's suggestion that everything that was bad in the inner cities had been caused by the present Conservative Government. Of course, the reverse is true. The inner city areas that have been controlled for longest by Labour-controlled councils are in the worst despair and are the areas where there is an atmosphere of no hope. It is inner city areas such as Battersea and Wandsworth where there is hope and an expectation that things will get better. Indeed, they are getting better. We have seen from the results of the general election that in the inner city areas controlled by the Conservatives at local government level the policies have received the endorsement of the electorate and that the problems of unemployment are being dealt with effectively.

The hon. Gentleman said that he represents the safest Labour constituency in London. I hope that he will allow the ideas put forward by the Conservative party to take root in his constituency and will not be deterred from allowing that to happen by the prospect that it may cause more people in his constituency to wish to vote Conservative next time than did on this occasion.[Interruption.] There was a time when the hon. Gentleman could say that it was a 100 per cent. Labour council. In the past few months, that situation has changed.

Mr. Tony Banks

There is the SDP.

Mr. Chope

There has been the first break of that monopoly. As somebody who is very much against monopolies, I welcome that and look forward to the time when the Conservatives will also be represented in Newham.

I shall respond to the points that the hon. Gentleman raised in correspondence, as I have done in the past. I look forward with expectation to answering several further Adjournment debates during the coming months.

Question put and agreed to.

Adjourned accordingly at one minute to Three o'clock.