Voluntary Services: Funding (Hansard, 20 March 1991)

Viscount Astor
My Lords, there have been no cuts in the funding of local government from central taxpayer sources. The Government increased aggregate external finance for next year by 12.8 per cent. It is for local authorities to determine their priorities for spending.

§ Baroness Ewart-Biggs
My Lords, I am grateful to the Minister for that Answer. It will bring little comfort to the increasing number of voluntary organisations which are facing substantial or total reductions in funding. They are carrying out invaluable work in giving advice and providing housing and community care. Indeed, they are carrying out the increased role that the Government have wished of them. Will the change announced in the Budget yesterday enable local authorities to reinstate some of the funding previously given to voluntary organisations?

Viscount Astor
My Lords, the Government value highly the great contribution made by the voluntary sector and already support it on a large scale. In 626 1988–89 government grants exceeded £2 billion. The Government will continue to provide funds for effectively-managed organisations that are providing worthwhile services which meet the Government's objectives. It is up to local authorities to decide which local voluntary organisations to support and they are best placed to determine local priorities.

§ Baroness Ewart-Biggs
My Lords, will the Minister please answer my question? Will the change announced in yesterday's Budget mean that local authorities will be able to reinstate some of the funds that they previously gave to voluntary organisations?

Viscount Astor
My Lords, I am not sure to which change in the Budget the noble Baroness is referring.

§ Lord Moyne
My Lords, is my noble friend aware that the allocation to the community volunteer scheme in Northern Ireland is being cut by more than 25 per cent? Does he appreciate the importance to the long-term unemployed of the practical skills acquired in working as volunteers and of the confidence given by the training in eventually finding work in that area where it is so tragically scarce?

Viscount Astor
My Lords, I am grateful to my noble friend. We appreciate the work carried out by all the voluntary organisations. However, as I said, it is for local authorities to decide how they wish to spend their money. They are best placed to choose how to do that.

Viscount Tonypandy
My Lords, will the noble Viscount bear in mind that the community voluntary service represents almost everything that is good in our national life; namely, the young unemployed who do not wish to waste their time and who are giving their services to help the old, the frail, the sick and the needy? There is a crisis in the community voluntary service. Will the Minister's department look at this matter and consider either the possibility of increased help for local authorities or advising on the matter?

Viscount Astor
My Lords, to put the matter in perspective, each year the Government announce the aggregate needed to spend in the following year to provide a standard level of service by local authorities. The total standard spending for 1991–92 is £39 billion —an increase of 19 per cent. over 1990–91. The aggregate external finance for 1991–92 is about £26.05 billion of that—an increase of 12.8 per cent. I shall certainly look into the point raised by the noble Viscount, Lord Tonypandy, and write to him.

§ Lord Jenkins of Putney
My Lords, is the noble Viscount aware that while it is true that local authorities determine their expenditure in an endeavour to remain within the limits laid down by the Government they have had to impose cuts? Is he aware further that those cuts have fallen heavily on the voluntary sector? In particular, some local theatres are in grave difficulties, which adds colour to the Question asked by my noble friend. Will the changes made yesterday enable local authorities to remove the imposition of such cuts?

Viscount Astor
My Lords, it is up to local authorities to balance their books and choose how they wish to spend their money. The voluntary organisations have a turnover of about £15 billion per year of which the Government finance centrally over £2 billion. The rest is raised from tax concessions of some £800 million and local government spending of over £600 million.

§ Lord Stallard
My Lords, is the noble Viscount aware that the crisis mentioned by a number of your Lordships as regards local government finance is a direct consequence of cuts to local government finance? A direct result of that is that the local authorities now face serious difficulties. Is the noble Viscount aware that voluntary organisations rely on local government for what is called their core funding?. That then allows them to request and receive matching funding from business, commerce and private sources. That core funding is now being cut and in some cases abolished altogether. My noble friend who asked the original Question is asking whether, following yesterday's announcement of relief for local authorities of some poll tax expenditure, the Government will permit local authorities to reinstate funds originally made available to voluntary organisations.

Viscount Astor
My Lords, the purpose of the new community charge grant announced yesterday is to provide for a reduction in the level of the community charge and not to boost local authority spending. The 1991–92 settlement provides already for resources which are adequate for realistic levels of spending. I said earlier, and I will say again, that it is for local authorities to ensure that their services are run efficiently. They must decide how to provide funds for the many voluntary sector organisations in their areas.

§ Lord Elton
My Lords, in order to clarify the present discussion and possibly to remove a misapprehension which is constantly repeated in this House, can my noble friend confirm that central government's subvention to local government has not been reduced and that the cuts do not consist of an intentional reduction by central government to a particular form of local authority expenditure because the local authorities remain free to make their own decisions?

Viscount Astor
My Lords, I confirm the point made by my noble friend Lord Elton. As he pointed out, the Government are giving more money to local authorities.

§ Lord McIntosh of Haringey
My Lords, perhaps the Minister will join with me in expressing pleasure at seeing my noble friend Lady Ewart-Biggs again on these Benches after her illness. Is he not at risk of misunderstanding the questions put to him about central government contributions to local authority expenditure? He has answered as to last year's changes but is it not a fact that over a number of years central government's contribution, as a proportion of local government expenditure, has declined considerably? Therefore, the anxiety expressed by the National 628 Council for Voluntary Organisations is not answered in the way in which the noble Viscount has answered it.

Viscount Astor
My Lords, standing spending assessments include provision for a range of services which include the voluntary sector. We believe that the amount of money paid by central government to local government is sufficient for their needs.

§ Lord Skelmersdale
My Lords, is not the real problem not so much the amount of money going from central government to local government—or, indeed, from local government to the voluntary organizations—but the timing of the money going from local government to voluntary organisations, as was established by my noble friend Lady Blatch in response to a recent question? Have we not become perilously close to the equivalent of fixing a date for a rate when we should legislate for local authorities to give a date for the amount of money which they will give to charities in the following year?

Viscount Astor
My Lords, I am not sure that I understand fully all the points made by my noble friend. He may be referring to an area in London where local councils have not been able to agree a budget. We hope that they will be able to do so later this month.