Renewal fund wins reprieve but concerns with other spending plans

    The government appeared to have listened to concerns over the
    winding down of the Neighbourhood Renewal Fund this week as the
    chancellor announced that the fund would be extended for a further
    two years, to 2007-8.

    Delivering his three-year spending review to the House of Commons,
    Gordon Brown said the £525m a year fund would “help to close
    the gap between the most deprived areas and the rest”.

    Regeneration experts had warned that if the fund had ended in 2006
    as planned, opportunities to reshape mainstream public services in
    deprived areas could be lost (news, page 14, 24 June).

    However, umbrella body Urban Forum called for clarification about
    whether the extended fund would continue to be shared between the
    original 88 most deprived areas or be used to cover a wider
    area.

    News of the government’s plans for an additional 10,000 social
    housing units a year for the next three years was welcomed by
    homelessness charities as “a clear signal of their intent to
    deliver”.

    Commenting on his department’s budget, deputy prime minister John
    Prescott said the investment in social housing and homelessness
    prevention would mean 11,000 fewer families with children living in
    temporary accommodation.

    But Shelter director Adam Sampson said the investment would only
    “slow the rate at which the housing crisis deepens” rather than end
    it.

    Local Government Association chair Sandy Bruce-Lockhart also voiced
    concerns about the impact of the plans outlined in the spending
    review on crucial local services.

    “We welcome the spending plans into areas such as neighbourhood
    renewal and housing. But local authorities, within these spending
    plans, cannot fund public services and keep council tax
    down.”

    Association of Directors of Social Services president Andrew Cozens
    added that he was “disappointed” at the level of funding made
    available to social services over the next three years compared
    with the amount allocated to health.

    Funding for social services will rise from £10.6bn in 2004-5
    to £12.5bn in 2007-8, including money to provide alarm
    technology to 160,000 vulnerable people to help keep them safe and
    out of hospital.

    Cozens warned that the government’s preventive measures outlined in
    its vision for adult social care would “almost certainly need
    funding over and above the sums announced in the spending
    review”.

    Spending review summary

    • 7.2 per cent per year real terms rise in health spending
      confirmed.
    • Education spending to rise from £52bn in 2004-5 to
      £64bn in 2007-8, including 17 per cent average annual real
      terms rise for Sure Start.
    • 2.7 per cent annual real terms increase for social
      services.
    • Three-year funding settlements for local authorities and an
      average annual real terms increase in local authority grants of 2.7
      per cent.
    • Extension of free part-time nursery education to two-year olds
      in 500 areas and 120,000 new child care places by 2008.
    • Extra £100m to increase the number of children’s centres
      by 2008 from the planned 1,700 to 2,500.
    • Improvements to Social Fund, including a lower repayment
      rate.
    • New Financial Inclusion Fund to develop affordable credit.
    • 10-year plan for affordable child care to be published later
      this year.
    • 10,000 additional social housing units a year by 2007-8,
      representing a 50 per cent increase in funding.
    • Continuation of the Neighbourhood Renewal Fund.
    • Additional investment in police IT to take forward the
      conclusions of the Bichard Inquiry.
    • Loss of 1,960 civil service posts at the Department for
      Educaton and Skills, including 500 at Ofsted.
    • Loss of 720 civil service posts at the Department of Health,
      plus at least 5,000 job losses at arm’s-length bodies.
    • Loss of 400 posts at the Office of the Deputy Prime
      Minister.
    • Green paper on the reform of services for young people in
      England later this year.
    • 20,000 community support officers by 2008 to tackle antisocial
      behaviour.
    • Reduction of asylum support costs by at least £450m a year
      by 2007-8.
    • Total efficiency gains in local government of £6.45bn by
      2007-8.
    • 3.5 per cent annual real terms increase in spending on
      Scotland.
    • 4 per cent annual real terms increase in spending on
      Wales.
    • 3 per cent annual real terms increase in spending on Northern
      Ireland.

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