Services under pressure as funding rules change

News Stories

1 May 2008

VOLUNTARY sector services for drug users in many parts of Scotland are under pressure as major changes to funding arrangements take effect and threaten to undermine efforts to bring about the Government’s new focus on drugs “recovery”.

Organisations in many parts of the country are being forced to lay off staff and withdraw or reduce services as projects are hit by the end of protective council ring fenced funding and implications arising from switching funding of employability services from the New Futures Fund to the Link opens in new window Fairer Scotland Fund (FSF).

Growing concern among MSPs has led to the Scottish Parliament agreeing on the “pressing need” to Link opens in new window review the system to provide more stable funding for the voluntary sector, including longer-term contracts and a national contracts framework.

MSPs have also called for a review of the new Link opens in new window Concordat involving Single Outcome Agreements (SOA) between Scottish local authorities and the Scottish Government, under which councils spending is freed up in exchange for delivering key Scottish Government priorities, after the first year of operations.

And it wants to see “greater dialogue” between the voluntary sector and councils on the operation of the Concordat.

One of the worst hit has been the homeless charity Link opens in new window Aberdeen Cyrenians, which has suffered a cut of almost £900,000 - a quarter of its budget - by the city Council as part of a wider package of cuts of £27 million. However, Finance Secretary John Swinney says that the Council’s problems are a direct result of previous administrations of the council not living within their means.

Other places hit by the crisis include Dumfries and Galloway, where Independent Living Support which helps people with drug and alcohol problems sustain their tenancies has lost £90,000, according to local MSP Elaine Murray.

appeal

In Dundee, the Link opens in new window city’s Cyrenians have launched a £75,000 public appeal to recoup underwritten cash diverted to keep open employability services based at their Wishart Centre; However, their homelessness crisis service have been forced to close. (see below for details of how to contribute to the fund)

In Edinburgh – hype, the citybased drugs charity for 18s and under - has lost two specialist posts for looked after/accommodated young people as a result of the city council’s decision to bring the function in-house. Edinburgh Cyrenians has also suffered a £30,000 cut, according to city MSP George Foulkes.

Meanwhile, the future of several employability projects in Glasgow – including ones run by Aberlour Child Care Trust, Move On, Blue Triangle Housing Association, Glasgow Simon Community and REALISE – is in doubt as they wait for new tendering processes to take shape as part of the switch of funding to the new Fairer Scotland Fund, which allocates the cash through Community Planning Partnerships.

The projects have already been forced to seek emergency funding to fill the shortfall between the end of the New Futures Funding and the commissioning of new employability services by the city’s Community Planning Partnership.

However, the projects will face renewed problems when this money runs out at the end of June unless the tendering process has reached the sub-contracting stage at which these projects make their bids to provide the frontline services.

cuts

In a Holyrood debate, North East Fife Liberal Democract MSP Iain Smith said that “the sector provides vital services to some of the neediest in our community, and this Government is simply not respecting it.”

Dumfries Labour MSP Elaine Murray said that the new arrangements were making “cuts in funding to real organisations that provide real services to real people.”

The issue, she said, was being compounded by uncertainty about eligibility for new funding streams, such as the Fairer Scotland Fund. Ms Murray said this would flatline at £145 million over the spending review period, meaning a real-term cut of 8 percent by 2010-11.

Meanwhile, major national charities have expressed concerns about the demands that will be placed on them if they are required to apply to 32 different local authorities instead of to one national fund, she told the chamber.

pressures

“There could be worse to come. In the face of the uncertainties that exist about future funding, many councils have, for the time being, rolled forward existing spending commitments, but that approach may be impossible to maintain if funding pressures build further.

“Voluntary sector organizations cannot survive being put on hold while details of single outcome agreements, the Scottish Investment Fund and the Fairer Scotland Fund are being worked out.

“The consequences of delay for them are redundancies, demoralisation of staff and, ultimately, reduction of services.”

Ms Murray, who called on the Government to provide transitional funding for organisations that are affected to enable them to survive until the new funding streams are in place, also highlighted Scottish Trades Union Congress concerns about:

• the insecurity of third sector employment contracts
• lower wages and poorer conditions of employment as organisations compete to secure contracts.

auctions

“The practice of reverse auctions, for example, whereby authorities advertise care package requirements to attract the lowest bidder, encourages undercutting not only of the public sector, but of other third sector organisations.

“The third sector’s voice needs to be heard, and voluntary sector interests must be represented in the single outcome agreement negotiations.”

However, Enterprise Minister Jim Mather said that the Scottish Government wanted the voluntary sector to thrive and grow, and accused the Labour Party of inculcating “groundless fears, uncertainties and doubts.

He told MSPs that the Scottish Government wanted local authorities, community planning partnerships and the third sector to work together increasingly closely and collaboratively to
deliver better services to their communities.

“New opportunities exist for councils, which are now free to decide what their priorities are and are free to choose how to secure those priorities.

“Our approach also creates the opportunity and the motivation for councils to scope and assess both the needs in their areas and the capability of the communities to be involved in meeting those needs.

“That demands a new and positive approach from councils and communities.

“Consequently, we are focusing strongly on how the third sector plays into this burgeoning sense of localism.

“The new arrangements bring a strong focus on the community planning partnerships, offering
them a heightened sense of purpose and the means to increase community spirit.”

Dundee Cyrenians
Pay a Pound and Save the Wishart Appeal

Donations – including cheques made payable to Dundee Cyrenians – can be forwarded or handed in to:

The Wishart Centre
50 Constable Street
Dundee
DD4 6AD

For further details contact: Richard Howat, Head of Service, Dundee Cyrenians,
tel 0783 4481033 or email richardhowat.cyrenians@virgin.net