Relief for Children’s Fund: u-turn on cuts

The government has found extra money to rescue the Children’s Fund
from a 15 per cent budget cut in the coming financial year.

In a conciliatory and apologetic letter, Anne Weinstock who manages
the Supporting Children and Young People section at the Department
for Educational and Skills told programme managers and chairpersons
that cuts to the 2004-5 budget announced two weeks earlier would
not now take place.

The first letter, also from Weinstock, announced a 15 per cent cut
to Children’s Fund allocations in 2004-5, and a 30 per cent cut in
2005-6. The cuts were blamed on “over-allocation” last year by the
former Children and Young People’s Unit.

The latest letter says ministers have found new money from outside
the Children’s Fund in 2004-5 which means the total budget for the
year will be £160m.

There will also be a contingency fund to allow Children’s Fund
partnerships to respond to exceptional circumstances. This is
likely to include situations in which service providers had been
promised funds which were then clawed back by the centre from local
programmes because they had not been spent by the mid-year
deadline.

The change of heart follows publicity about the cuts in several
national newspapers last week.

There are no promises in the letter about 2005-6, although the tone
suggests the across-the-board 30 per cent cut announced two weeks
ago is now less likely. Weinstock said that ministers “wish to
approach these issues collaboratively with the sector” and that the
final decision will depend partly on the 2004 spending
review.

The letter also implies the Children’s Fund may survive beyond
2006. Final decisions and allocations for 2005-6 will be made in
the summer of this year, says Weinstock. “Our aim will be to give
you a firm planning basis for that and future years at that
time.”

The letter also lists a series of major concessions including
allowing programmes to carry forward underspend from this financial
year to next, and from next year to 2005-6. They will also be able
to “reprofile” from one quarter to the next – revise their spending
timetables during the course of the year in the light of local
developments.

The government is also thinking again about the rule forcing
Children’s Fund programmes to spend 25 per cent of their money on
youth justice projects, in conjunction with local youth offending
teams. The 25 per cent rule was announced at the end of 2002, and
was to apply in 2003-4 and 2004-5. It meant a major disruption for
local Children’s Fund programmes as service planning had to be
totally revised despite lengthy consultations with local children
and their families. Ministers from the Home Office and Department
for Education and Skills are currently in talks about the rule, and
“are looking to reach agreement soon,” says Weinstock.

Barnardo’s have welcomed the reprieve for this year but expressed
continuing concern about the Children’s Fund budget for
2005-6.

Chris Hanvey, Barnardo’s UK director of operations, said: “This
last-minute reprieve will allow us to defer planned cuts in jobs
and services, but we won’t know the effect of the reduced funding
until the regional allocations for next year are received. Nor can
we be certain of the future for services if the 2005-6 cuts go
ahead.

“We appreciate that the DfES has worked hard to resolve this
matter,” he added, “but the uncertainty over funding is putting
great pressure on our staff and services, and has undermined the
trust between government and voluntary organisations. There is much
ground to make up in the DfES’s claims that it works in partnership
with the voluntary sector.”