§ Mr. Ian Cawsey (Brigg and Goole) (Lab)
I am grateful for the opportunity to raise this issue and to tell the House of the concerns in north Lincolnshire about cuts in the council budget to support the following local voluntary organisations: Voluntary Action North Lincolnshire, the Humber and Wolds Rural Community Council, the citizens advice bureaux, the Crosby Community Association and the Humberside law centre. Last year, the organisations' funding from North Lincolnshire council was about £350,000. Most seek no real-terms increase, but the decision to cut the budget to £250,000 was a devastating blow to those groups and to people in need throughout north Lincolnshire who rely on their services.
I shall begin by putting the matter into perspective: starkly, the reduction in funding is the political choice of a new administration. In 2003, in an extremely exciting, all-out election, which is not the norm, the council switched from a Labour to a Conservative administration. There was a good turnout and the Tories won 22 seats to Labour's 21, winning two wards by a single vote. Whoever said that their vote did not count?
As all new administrations do, the incoming Tories inherited the budget set by their predecessors, so for a few months there were no great problems. Indeed, the Government's settlement for that year was, to quote the council leader, Don Stewart, when he was in opposition, "a good settlement". Having taken that good settlement, the administration received a 6 per cent. increase this year—about double the rate of inflation.
Why, therefore, has the council run into problems so quickly? The short answer is that the local Conservatives ran on a simple election pledge: to cut council tax by £40 when they came to power. First, they said that there would be no immediate refund, which would have to wait until they set a budget; then the issue became dependent on the settlement; and finally it was simply abandoned. Services and charges have been sacrificed on the altar of political expediency as a result of at best foolish and at worst devious pledges to the electorate.
The 6 per cent. increase on the good settlement was castigated as a poor settlement, and a mythical black hole in the finances suddenly appeared. It was originally claimed to be £3 million, but it grows with every news release and everything is blamed on the outgoing Labour administration, about whose finances I quote the following statement:The council achieved a net underspend of £300,000 … more importantly, the council is facing significant cost pressures … and has identified savings to achieve a balanced budget. These savings will not affect the council's … service priorities.Those words on the position of the outgoing Labour administration are not mine or those of a Labour party member, but those of the council's external auditors. Not only is there no black hole, but there is an underspend to boot, which is not a bad start for a new administration.
The voluntary sector is among those that have had to carry the can for the new administration's pursuit of their poorly costed and unlikely pledges. With only two 435WH weeks' notice, the groups were informed of the £100,000 cut in their budget and the law centre was told that there would be no funding at all, which did not surprise me. It was originally set up and funded by the former Humberside county council, of which I was a member, and it was opposed by the Tories, including the current leader of North Lincolnshire council, on the ground that it would put local solicitors out of work. It may have given access to the law to those who did not have it, but it did not seem to close any local practices many years later. I was the leader of new unitary authority of North Lincolnshire council when it had its first shadow elections in 1995. We had to decide again whether we wanted to fund the law centre. Yet again, the Tories opposed it, saying that many of the cases that it took up were against the very authorities that funded it. To this day, I find that extremely hard to believe, because it suggests that it is okay for councils to act unlawfully against local people so long as those people have no redress against them. As I said, however, it is unsurprising that the funding will go now that the Tory councillors have the power.
Some of these organisations, such as the community councils and citizens advice bureaux, are well known to many people. Voluntary Action North Lincolnshire, for example, used to be known as the community and voluntary service, and everyone involved in voluntary organisations has heard of the councils for voluntary service. These organisations play key roles in advocacy and service delivery on issues such as social inclusion. However, less may be known of the local Crosby community association, which is based in the constituency of the Minister for the Environment, my hon. Friend the Member for Scunthorpe (Mr. Morley), who very much supports its endeavours and those of the voluntary sector in general in the area, as does my hon. Friend the Member for Cleethorpes (Shona Mclsaac), who also represents part of north Lincolnshire.
As my hon. Friends and I know, the association helps people not only in the Crosby area, as the name might suggest, but throughout north Lincolnshire. Last year, it helped to obtain £1.6 million in unclaimed benefits for the most disadvantaged in our community, as is acknowledged in this quotation about the funding cuts:Families with children in the most deprived wards in North Lincolnshire will be badly affected, putting at risk years of hard work by a range of partner organisations to improve the area in and around Scunthorpe Town Centre".I agree, but, amazingly, that was said by the council leader who is cutting the voluntary organisations' funding. The council's defence is that the association has lost Government single regeneration budget time-limited funds. The association tells me that that is not the case, but that it has had various external funds and seeks to ensure they are replenished so that it can continue its work. In essence, North Lincolnshire council's choice is simple. Is it willing to spend what would amount to thousands of pounds, but which will in turn involve millions of pounds, on the most needy people in north Lincolnshire, and what will it say about its priorities if the answer is no?
436WH My hon. Friend the Minister will know all about compacts, which are Government-inspired, locally based agreements between those in the voluntary sector and those who fund them and rely on their services to deliver their agenda. I am pleased that a compact exists in north Lincolnshire, and much praise must go to Voluntary Action North Lincolnshire and others for the proactive way in which they approached the issue. I had the great privilege of speaking at the initial meeting at St. Bernadette's hall in Scunthorpe when the idea was first mooted. We all scratched our heads and wondered why no one could think of a better name than "compact", but that is the name. I also spoke about a year ago at the launch of a compact at Scunthorpe baths, and much more recently at the update seminar, when we spoke about the progress that has been made since.
Funding is one of North Lincolnshire council's most critical areas. No one would disagree that councils can decide on funding—after all, they are elected by the local community and they set the council tax. However, the compact is intended to establish that a respectful relationship will be maintained; that groups will be involved in discussions; that funding will not be cut without good, clearly explained reasons; and that due notice will be given.
Every principle of the compact was disregarded by North Lincolnshire council. The previous Labour administration gave groups the safeguard of 18 months' funding and full discussions, and it was a willing signatory to the compact, because it believed that it enhanced the good practice that it wanted to establish. The cuts that I am concerned about were announced with only two weeks' notice on a take-it-or-leave-it basis.
It is little wonder that the protests were so loud and strong and that, yet again, the public gallery in the council chamber was full of angry residents, although that has increasingly become the norm in recent times. It does not seem to matter whether the subject under discussion is cuts to voluntary organisations, cuts in leisure services, cuts across the council agenda or increases in charges—we have a very angry community.
The council responded that as the Labour administration had signed the compact, it had nothing to do with the Tory administration. That is an interesting take on all the treaties that any incoming Government inherit from a previous Administration; apparently, somehow they no longer count. It was pointed out that. notwithstanding the date of final agreement of the compact, it had received all-party support when it was passed at a full council meeting. The current position is that the council supports the principle of the compact, but not necessarily all the details.
In the meantime, a welcome decision was taken that groups would be given six months' funding at last year's level. However, that was not quite as good as had at first been hoped. It was pointed out that there would not be any expansion in the £250,000 allocated by the council to the funding of voluntary organisations this year. That means that if six months of increased funding were taken up, there would be even larger cuts later in the year. Anyway, the council has now reduced the period in question to three months.
437WH I do not want to pretend that all that I have outlined is happening after a time when summers were hotter and longer and the grass was greener. Voluntary organisations are used to difficult times and to having to chase around to fund worthy projects. Golden eras sometimes exist, but golden eras in funding are often apparent only long after they have passed. However, having been involved with the voluntary sector since 1989, when I was first elected a councillor, I have never known that sector to be as bruised, and with such low morale, as it is now following the treatment that it has had this year over funding from North Lincolnshire council.
What is the point of a compact? Why did all those groups from throughout north Lincolnshire spend so long negotiating with the council for it all to be tossed out on the whim of the ruling group? If the Home Office wants such arrangements as the norm and wants them to succeed, what can the Department do to try to influence the decision makers at North Lincolnshire council?
Most importantly, it is via voluntary organisations that much of the Government's agenda—social inclusion is the most obvious item—will be put into practice. The funding often comes via the council, in that the Government put the money in with an expectation that certain things will be delivered, and it reaches the voluntary sector through the halfway house of the council. Given this year's experience, we know that even when councils receive a 6 per cent. increase in their funds, that is not guaranteed to have a positive impact on the voluntary sector. Indeed, our experience in north Lincolnshire this year is quite the reverse.
Is it not time to tell councils that sign agreements and compacts and then tear them up that such irresponsible actions could have an impact on their future settlements? The comprehensive performance assessment is one method of judging councils on their delivery of agendas and formation of local strategic partnerships, and on their involvement of the voluntary sector and others in providing good-quality services in their area. Decisions are made through that assessment on the funding that councils will receive. There seems little point in the Government pumping money into that process if there is no good will from the local authority at the other end.
The compacts are rules that the councils have helped to set, and they now need to abide by them. It seems incredible that just over a year ago in an area of some 153,000 people only two votes were the difference between the ongoing Labour administration and a Conservative one. Those two votes were the difference between a fair council and an unfair one, between being interested in inclusion and causing exclusion, and between being progressive in what was trying to be achieved in north Lincolnshire and being regressive. All that happened simply because of a failed pledge on the level of council tax.
The people of north Lincolnshire deserve better. We need compacts with teeth and compacts that work so that voluntary organisations and the needy people whom they represent are protected from the political whims of an incoming administration that simply does not value what the voluntary sector is doing. I look forward to the Minister's response.
§ The Parliamentary Under-Secretary of State for the Home Department (Fiona Mactaggart)
First, I thank my hon. Friend the Member for Brigg and Goole (Mr. Cawsey) for drawing the attention of the House to this important issue and for demonstrating his understanding of the vital and unique contribution that voluntary organisations make to community life. He talked about community life in his own and a neighbouring constituency. His account is common to constituencies throughout the country where the impact of voluntary organisations in tackling poverty, which is one example that he used, is second to none. He also demonstrated, in common with many other hon. Members, a familiarity and a connection with the detail of the work of local voluntary organisations that show how assiduously he represents his constituency.
The Government recognise the vital and unique role of voluntary organisations in delivering services to communities. We have put in train a number of mechanisms to support, underpin, enhance and enable them to do that. In many ways the most important factor is to recognise something that is expressed in the compact as the cost of doing business or the important costs of the infrastructure to deliver services to people. At least one of the organisations that he described as being at risk is one of those classic infrastructure organisations. Much of its work is in enabling other voluntary organisations to do their business, which is the traditional role of the council for voluntary service.
We recognise that those organisations are not always the most obviously popular in terms of local funding, yet many other local organisations simply cannot do their business without that support. That is one of the reasons why, following the 2002 cross-cutting review of the voluntary and community sector in service delivery, we have developed a framework for infrastructure and are developing investment in infrastructure, which are designed to enable those more locally focused organisations to do their job well, rather than to supplant local investment in very local organisations.
The job of ensuring the local dimension of funding is partly done by central Government in providing a generous and secure settlement for local authorities, providing an appropriate national framework in which voluntary organisations can thrive and enabling local authorities to invest in the contribution that local voluntary organisations make. As my hon. Friend demonstrated, the local dimension of the funding relationship is particularly important. Indeed, 70 per cent. of voluntary and community sector organisations operate at the local level. That is where the problems that he described arose, despite the fact that North Lincolnshire council received a generous settlement from the Government and that its books were, as he said, left in a healthy state by the previous administration.
I think that my hon. Friend will agree with the Government that local funding priorities should be decided at local level. The Government expect local authorities to value and support the essential role that a strong local voluntary and community sector infrastructure plays in helping authorities to develop and deliver community strategies and to build the capacity of local groups to fulfil their role in 439WH strengthening communities and delivering services. I am therefore disappointed that my hon. Friend's local council seems not to be investing in such infrastructure.
Such problems are one reason why we developed the local compact, which now covers the overwhelming majority—89 per cent.—of local authorities. The compact provides a basis for building and enhancing the relationship between the local voluntary and community sector and public sector bodies. Published compacts must be used—this is Government policy—to improve the way in which business is done locally. They are about making commitments, calling partners to account and resolving differences. I am disappointed to hear that a locally agreed compact appears to have been disregarded. It is not right that a local council should seek to tear up commitments that it has made, even if it was under different political leadership at the time. As my hon. Friend said, the compact is like a treaty, and Governments cannot simply tear up treaties that have been entered into on their behalf.
We have instigated the compact mediating scheme to resolve disputes over compacts between the local voluntary sector and local public sector bodies.
§ Mr. Cawsey
Perhaps I can just say two things. First, I fear that we have a lot of work to do on getting the current administration to see the benefits of the principles of the compact. When asked about those principles at a meeting with voluntary sector representatives, one councillor said, "You can't have principles without cash." I am not certain that I would accept that statement, but it was made quite clearly.
Secondly, I, too, have mentioned the mediation scheme to local voluntary organisations. Although they are very interested in it as a possible route to resolving disputes, they are concerned about who will pay for the service, because their funds are declining and they have precious little money of their own to do so.
§ Fiona Mactaggart
I understand that that is a problem with the scheme, but I nevertheless urge voluntary organisations seriously to consider it because the investment can pay dividends and has done so in other cases. It is difficult for voluntary organisations facing a crisis of the scale that my hon. Friend described to consider taking such steps, and the compact mediating scheme does involve costs, but I would urge organisations to use it. Where it has been used to date, it has frequently produced a resolution that has made a real difference for the organisations involved.
The compact must be made to work. If 89 per cent. of the country is covered by local compacts, it is certain that local government organisations of the same party that is in power in my hon. Friend's local authority have devised, developed and signed up to them. It is neither right nor sensible for his local authority to pretend that the local compact is a creature of another political party. It is a creature of all political parties.
440WH I look forward to the annual compact meeting tomorrow, which I shall jointly chair with Sir Michael Bichard. One of the reports will be from the Local Government Association on the commitment of local government to the compact. It will be interesting to draw the attention of my colleagues in local government to the example that we have discussed of the failure, perhaps, of one part of local government to live up to the ambitions of the compact.
I also take on board my hon. Friend's point about whether other measures to test the commitment of local government, such as the comprehensive performance assessment, could have embedded in them some way of measuring, for example, commitment to compact. That is already being done. In the newly developing comprehensive performance assessment, there is a greater emphasis on partnership and leadership. Formerly, the assessment of performance involved individual service areas being drilled down and focused on the precise outcomes.
As the scheme is being developed, however, there is a much greater recognition that much of what local government delivers is delivered not by local government itself through either its social service or education departments, but through its partnerships with voluntary organisations and other statutory bodies. At the heart of those partnerships is a relationship of mutual trust and respect. If North Lincolnshire council has decided to tear up the relationship of trust and respect that is embedded through a compact, that puts its ability to deliver at risk.
The council is held to account not, fundamentally, by national Government. but by the local electorate. My hon. Friend's account of the local electorate's response to the way in which his council has not upheld the relationship of trust that is at the heart of the compact suggests that the electorate may well tell the council that they will not tolerate such failures. That is the fundamental resolution of the compact. Nevertheless, I undertake to raise such issues in the compacts annual general meeting tomorrow, so that we can consider whether there are more practical ways to enable voluntary organisations to use the resources at their disposal, such as the mediation scheme, when they are faced with problems of the kind that my hon. Friend faces.
The Government's belief is clear: at the heart of our provision of a public life that engages and involves citizens is a vision not of the local council or the national Government doing everything, but of delivering change in partnership with voluntary organisations and enabling them to be active partners. That might mean disputes over funding, but those disputes should be operated within a framework of trust and mutual respect. That is what we have sought to deliver in the compact and what we shall continue to seek to do—
It being Two o'clock, the motion for the Adjournment of the sitting lapsed, without Question put.