London Councils Grants Scheme -under threat.

[McCatllar]

A ?28m London-wide scheme providing funds to voluntary sector organisations providing services for Londoners for the last 25 years.

All the London boroughs contribute annually to a central pot...things funded include services for the homeless, women and chidren who have been subject to sexually violence, domestic violence projects, free legal and advice services, work in schools. Most services would not be economically viable if only supported by one borough. Southwark benefits from these and other services equivalent to around ?1m per year.

It is proposed that the boroughs will stop contibuting to the Scheme from 1 April 2011. Only one borough so far has said they will spend their share on the voluntary sector locally (Lewisham). The likelihood is that most of the money the boroughs would no longer give to the Grants Scheme will go straight into the big black hole of their deficit cuts.

360 organisations providing vital services face closure...so much for the Big Society.

To register your opposition, contact the London Voluntary Services Council http://www.lvsc.org.uk/ ,write to your councillor and the Chair of the London Boroughs Grants Commttee [email protected]

For more information about the Grants Scheme, including what's funded in Southwark, visit:

http://www.londoncouncils.gov.uk/grants/default.htm

[DJKillaQueen]

Aye, it's a sad sign of what's coming. In fact councils will be required to cut by 27% over the next four years and I don't think any amount of opposition is going to have any impact.

[Ridgley]

That is the Tories for you

[Marmora Man]

Ridgley - too simplistic. If you object to certain cuts then, given the overall state of public finances, you must propose an alternative cut elsewhere.

[Bellenden Belle]

These cuts are likely to affect voluntary organisations working with some of the capital's most vulnerable or disadvantaged groups.

What is so important about these grants are that they provide funds for London- wide services which simply don't exist in every borough. Not every borough can provide targeted work for specific vulnerable groups, yet by contributing to a general fund they can currently ensure their residents can access the specific services for their particular needs.

So a charity in Camden might also receive referrals from Hackney, Islington and even further afield. And this funding is heavily monitored with boroughs receiving detailed figures of exactly how many of their residents have accessed the services they've paid for.

Even if councils ringfence the money to support local voluntary groups, it will mean charities in that borough may receive support, but what of the other services across London their residents might need to access? For a charity, how do we approach upwards of twenty boroughs to negotiate funding? Essentially this will signal a cut in many targeted services.

And how ironic that as the coalition applauds the sharing of services across local authorities and talks of The Big Society, it appears to be cutting off one of the most important funding resources available to charities working across the capital.

[SeanMacGabhann]

Sometimes, JUST opposing is enough tho Marmora Man, if only to prevent things getting worse

I see the model adopted by Barnet council (the easyjet model) is failing pretty badly

at least compared to the targets they set

The worry about these cuts is that they will cause all of the pain, deliver few if any of the savings and make the whole economy worse. But because the cuts are driven by ideology as much as pragmatism about the debt, opposing them for teh sake of opposing them is appropriate

[Ridgley]

I am not objecting, to cuts I understand the country is in financial crises it is where the cuts will lie and normally with the Tories is the worst off that are most affected.

[Marmora Man]

Ridgley, Sean,

The problem is tho' that the country cannot go on financing all the nice / good / laudable activities previously funded on what was, effectively, an overdraft.

I dispute the claimed ideological nature of the current savings programme - the Tories I associate with are mostly "one nation" tories and regret the necessity of reducing gov't spending, their preferred stance going forward would be the "shared proceeds of growth" model that is, regrettably at present impractical - growing public spending at a slower rate than the growth in GDP. Conversely the libertarians I associate with accuse the Coalition of timidity.

I can see the argument for retaining some / all / much of the spend on local grants schemes, tho' in passing I'd comment that if they're funded from gov't sources they are not, strictly, charities but more like quangos.

My alternatives would include reducing funding set aside to maintain free access to museums and other arts events / funding, to reduce the growth in overseas aid, to fight tooth & nail to restrict EU donations (topical today). I'd probably also bring forward the troops out of Afghanistan to enable a reduction in the Army budget (spending half that saving on retaining Harriers for the aircraft carriers)

[Bellenden Belle]

Marmora Man:

Firstly, I would question your description of funding services as "nice/ good / laudable". Many of these organisations respond to an actual social need - whether it be responding to homelessness; hiv in families and children; or helping people with severe and enduring mental ill health (all examples of London Council's funding). Take those services away and there will be a far greater demand on other resources - including health, social services, and possibly even policing.

Your comment that charities funded from government sources are not strictly charities but "more like quangos" does not fairly represent the current voluntary landscape or indeed the future plans for using the expertise of charities and voluntary sector more effectively as part of the The Big Society.

Charities often receive government funding as one of their income sources. Charities in recent years have been supported and encouraged to apply for government tenders because it has been acknowledged they are often a cost-effective way of delivering outputs and outcomes - for example supporting peopleto return to employment. That does not belittle their charitable status and in all the charities I have worked in, funding received by government resources has funded only a fraction of the work delivered.

[SeanMacGabhann]

But your implication there MM, is that many of the things being cut are desireable, they just can?t be afforded

I would rather more people were honest and said we don?t want them, we can?t afford them so there

If they are desireable, I don?t think an overdrdaft is required to fund them. They are not extravagences and this is a country with means to support them (current situation possibly notwithstanding). What is lacking is the will for people who can stump up, to stump up. The rest (pro or anti) is just politics but if the question is CAN the country (as a whole) support the things that are being cut, then I say it can

It?s analagous to people who bemoan good food, and say they don?t have the time or money. Your argument is often that that isn?t really true they just choose to spend those things elsewhere or can?t be bothered

Now getting the hands on the cash is the hard part ? the people with it by and large cry and sqeal and say they will leave the country. (people without cash who bemoan anything lesser such as shift patterns get told they are selfish ? no such mass judgment on the well-off)

But the means are there

[Jeremy]

The means are indeed there. Income tax in the UK is relatively low by European standards.

[Marmora Man]

But Sean & BB - you're are both arguing against the grain.

For more than 40 years the average UK gov't spending has been on / around the 40% of GDP mark. Other countries have a higher or lower acceptable level - USA is probably closer to 35% (or perhaps lower), Scandinavia maybe closer to 50% (or perhaps higher) - the level is not a matter of what can be afforded but what is socially acceptable - the actual level is neither intrinsically good or bad.

This 40% mark seems to represent the acceptable level for the majority of UK tax payers. The recent splurge has taken gov't spending to closer to 47% of GDP and the Coalition savings plan is aimed at getting back toward the 40 year trend.

To shift from the "norm" a country needs to be persuaded of the benefit in some fashion. The last administration took us to the higher proportion of GDP spent on public sector not by persuading taxpayers it was a good idea to increase taxes (and a case can be made if enough choose to do so) but by extending borrowing - which is unsustainable.

So, in my view, something has to go and the problem is about making decisions - not about the need to reduce gov't spending.

Perhaps Ed Milliband will persuade voters that all of us paying more taxes is a sensible move, perhaps some extreme libertarians will persuade David Cameron to create the small government I have often proposed. However, until either event comes about UK is stuck on or around the 40% of GDP spending trend and the problems this creates.

I personally don't think that the taxpayer can be pressed much further. 85% are taxed at roughly 22% or less and are finding it hard to get by. 15% of the country are higher rate tax payers - meaning that every penny they earn over ?44K is taxed at 41%, if they rise to the 3% earning over ?100K the rates increases to about 45% with progressive loss of tax free thresholds such that if they earn over ?150K (a very small % of the population) they are taxed at 51%, with no tax relief at the lower level, taking a marginal rate to close to 60%. All those figures ignore the impact of indirect taxes such as VAT, pension taxes, petrol taxes, green taxes etc.

Increasing taxes on bankers or businesses won't generate enough by itself, the targets represent too small a fraction of the total tax paying community. Solid growth with low gov't borrowing is the way out of the problem - combined they may mean there are enough funds to support again some of the critical areas you have both described.

[McCatllar]

@ Bellenden Belle...and anbody else interested, you can give your thoughts on the proposals for the future of the London Councils Grants Scheme by taking part in the consultation (closing date 10 November).

http://www.londoncouncils.gov.uk/grants/aboutourfunding/futureofgrants.htm

[SeanMacGabhann]

Oh I don't need to be told I'm going against the grain - that much is obvious to me.

But to take the recent Vodaphone 6 billion tax bill as an example. They dispute and blah blah blah. And probably from an accounting perspective they may well be correct. But for the sake of argument, this company (and let's take as a given there are many many like them) earned enough money to come on the radar for that tax bill. What if, and I know it's bonkers, but what if they paid it. Similarly other companies in the same bracket

that isn't a lot of social engineering, expensive legistlation or anything else - that's just pointing out that the "taxpayer" needn't be broken down into 15% on this, and 85% on that and they already pay x, y or z

Just companies, earning that much money, should pay the tax nominally due

[SeanMacGabhann]

And rather than have a government make them, what if they sold it to customers as a USP. What if they found a way of saying they played their part in the debt reduction?

[Jeremy]

You think more customers would use Vodaphone if they voluntarily paid extra into the public purse? Really?

[McCatllar]

Actually, if there were the choice of purchasing goods and services from more not-for-profit social enterprises, I would definitely go for it in the same way I would bank with only ethical investors (if I had anything to invest).

I would also go for a company which guaranteed it wasn't on the tax-fiddle...or practising 'creative accountancy' (AKA 'theft').

But hey, this thread is supposed to be about the plight of the London Councils Grants Scheme...have you tackled the consultation questionnaire yet???!!!

[DJKillaQueen]

I'm with Sean on this issue. I think we can afford things - we are not a poor country but we are an expensive one. There is definitely an ideological edge to the distribution of cuts about to be made (that is basic politics) and it is an ideology that will reduce upward social mobility for the poorest and inrease the gap between rich and poor (we already have one of the biggest gaps). Any society that squeezes the poorest (who are poor through no fault of their own) in the way the recent spending review does, is a bad society, and what angers me is that no-one really cares.

[SeanMacGabhann]

Is there another reason companies are so keen to sell us how ?green? they are? They must think we, the public, can be appealed to via our better nature?

Regardless, they should do it anyway. They earned the money, pay the tax. It doesn?t matter how much they are already paying if they should be paying more. I can?t pay half my tax and tell the treasury ?but if I left the country you wouldn?thave had the thousands I?ve paid in this year?

TO tackle the subject of the debt itself tho ? this idea that we spent our way into it, throwing money around willy nilly really bugs me

TO quote Jonathan Freedland (and I?m happy for people to correct him on any of the points, but I?d rather it didn?t descend into newspaper name-calling)

?A quick look at the figures confirms that, until the crash hit in September 2008, the levels of red ink were manageably low. The budget of 2007 estimated Britain's structural deficit ? that chunk of the debt that won't be mopped up by growth ? at 3% of gross domestic product. At the time, the revered Institute for Fiscal Studies accepted that two-thirds of that sum comprised borrowing for investment, leaving a black hole of just 1% of GDP. If the structural deficit today has rocketed close to 8%, all that proves is that most of it was racked up dealing with the banking crisis and subsequent slump ? with only a fraction the result of supposed Labour profligacy. After all, even the Tories would have had to pay out unemployment benefit.

This is why Ed Balls was right to declare in his summer Bloomberg lecture ? which remains Labour's most robust effort yet to redirect the finger of blame away from itself ? that "it is a question of fact that we entered this financial crisis with low inflation, low interest rates, low unemployment and the lowest net debt of any large G7 country".?

http://www.guardian.co.uk/commentisfree/2010/oct/19/osborne-public-wrath-labour-blame-game

Going against the grain isn?t necessarily wrong either btw. Mass-delusion is not without precedent. It?s like a meme that has become so widespread no-one ever questions it

[Marmora Man]

I've posted this comment elsewhere but it goes to Sean's JOnathan Freedland quote.

If you look at the graph it can be seen that the last 10 years have seen a significant acceleration in the rate of gov't spending. It is this acceleration that has caused the structural deficit which we are all now having to "pay" for in cuts to gov't spending.

The long term trend is inexorably upwards - fine if it matches Britain's economic growth as it demands no more than taxpayers can afford. Essentially this is what UK can cope with. Bad if the spending rate exceeds economic growth as someone, somwewhere has to fund the gap. In the short term borrowing can cover off the shortfall but not forever.

From roughly 1982 through to 1998 the short term trend was less than the long term upward trend, public sector spending was growing but at a slower rate than economic growth. From 1998 till recently the rate at which gov't spending was growing looks to have been about twice the long term rate - unsustainable in the long term, it was bound to end in tears.

There have been periods in the past when gov't spending growth exceeded the long term trend and the areas above the line therefore represent "unacceptable / unrealisable" spending rates. The areas below the trend line represent periods where though slower gov't spending the tax payer was retaining more of their money.

I would suggest that any government can only change the long term trend with the agreement of the electorate - and since the long term trend hasn't changed in 50 years perhaps the electorate doesn't want it to move much in either direction, one being toward sustained higher taxes and higher gov't spending or alternatively, lower gov't spending and lower taxes.

It would be nice to think that post 2014 when this era of austerity may be coming to an end that it can be used as a platform to get back under the long term trend.

[SeanMacGabhann]

years of not paying for the things that need paying for will, unsurprisingly, lead to a period when those things get fixed and then you can draw a graph saying spending is inexorably rising. yes you can do that but it doesn't prove anything other than that

Spending rose and would probably have plateaued were it not for the banking crisis (speculation! I know) but few would argue most of it needed doing. So let's just pay for it next time

[SeanMacGabhann]

I?m not advocating full-scale socialism here btw. Just a little bit more balance in the debate. The whole ?tories fix the economy, labour wreck it? is way too simplisic

[The Chair]

Could I kindly ask that this thread be returned to the original topic of the London Councils grant rather than an extended debate on economics (as interesting as that is). I don't mind threads moving off on a tangent occassionally but it seems a little unfair on the OP for his or her thread to disappear into a Sean McG vs MamoraMan vs DJKQ Battle Royale.

Thank you. Carry on.

[DJKillaQueen]

Noted ;-)

[James Barber]

London Councils grants are a collective attempt by councils in London to create pan London funding for worthy projects.

But we have pan London government in the form of the Greater London Authority.

I've not check the timings but suspect these grants programmes started with the demiss of the GLC and tried filling that gap.

It seems long overdue for the GLA to lead on such schemes and grants.