Report warns on government cuts

Added on Wed 7th Jul 2010 by Trevor (Marketing and Communications Manager)

Government cuts will “inevitably” hit voluntary and community organisations, Regional Action West Midlands (RAWM) warns in a new report.

The report analyses the emergency budget and other announcements by ministers on how they intend to reduce the country’s huge debt.

It says that the freeze on council tax for one year “while assisting residents and local businesses will inevitably impact on the VCS/third sector, especially given the overall 25% cut in public expenditure.”

As an example, RAWM cites Walsall MBC’s review of ‘discretionary payments’ ie. grants, which will “undoubtedly impact upon larger third sector organisations in Walsall, creating a major challenge for those, such as Walsall Citizens Advice Bureau, which are seeing a steep rise in demand for services as a result of the recession.”
. The report says that changes to disability living allowance, housing benefit, and tax credits are also likely to impact on the sector as recipients, who are more dependent on the very (public) services that are being cut, seek the support of VCS organisations.

However, “the previously announced pledge to retain Sure Start children’s centres and expand the Family Nurse programme mean the VCS/third sector will be able to continue supporting low earner families.

“This may go some way to off-set the impact of freezing child benefit for three years,
abolishing the Sure Start Maternity grant, and compelling lone parents to seek work when their children start school.

RAWM speculates that while “therere was no express reference to the charitable sector the Chancellor started his statement by saying that the budget would promote a strong, enterprise-led economic recovery. This may indicate support for social enterprises which are seen as key to public service delivery by both Conservative and Lib Dem parties.”

Its report looks at planned changes to regional arrangements – including replacing
the regional development agencies (RDAs), set up by Labour to support local business, with local enterprise partnerships (LEPs) between firms and local government.

This has led Advantage West Midlands (AWM) to review “every one of its contracts.”

“While changes to regional arrangements won’t directly affect the local VCS/third sector, there are strategic implications, for example for routes to funding. Discussions and
negotiations are taking place amongst stakeholders within the region, and it remains to be seen if, and how the VCS/third sector will benefit.” Says RAWM

For further information contact Sharon Palmer, Chief Executive Officer, tel: 0121 359 9106, email (JavaScript must be enabled to view this email address)