Capacitybuilders and Futurebuilders 'a waste of money', MPs told

Labour MP Don Touhig challenges witnesses at Public Accounts Committee hearing into infrastructure quangos

A Labour MP has suggested that the voluntary sector would be better off if the Government had spent the £446m it has channelled through Capacitybuilders and Futurebuilders directly on front-line charities instead.

Don Touhig, who represents Islwyn in Gwent, south Wales, spoke out during an evidence hearing yesterday by the Public Accounts Committee into the Government's attempts to strengthen the voluntary sector over the past six years.

The hearing was called after the publication in February of the National Audit Office report Building the Capacity of the Third Sector, which said the Government's attempts to strengthen the sector's infrastructure through the ChangeUp and Futurebuilders programmes had had some positive effects but had failed so far to demonstrate value for money.

Touhig said he could not understand why the funding trail for ChangeUp, which has been managed by the non-departmental public body Capacitybuilders since 2006, was so complex.

ChangeUp money flows from Parliament to the Office of the Third Sector to Capacitybuilders and finally to local consortia, which then advise charities on issues such as IT and accounting.

"This structure could have come from an episode of Yes Minister," said Touhig. "Millions of pounds are being spent and voluntary organisations are getting advice.

"Well I'll give them advice. They can come to my surgery and I won't charge them anything.

"Isn't this just another series of quangos wasting public money when front-line services actually need it?"

Campbell Robb, director general of the Office of the Third Sector, said distributing funds directly to charities would have limited impact because there were 200,000 charities and 500,000 voluntary organisations. "The amount of money they would get would be small," said Robb.

He added that the OTS already awarded money directly to charities through its Grassroots Grants programme.

Robb, along with Matt Leach, chief executive of Capacitybuilders, and Jonathan Lewis, chief executive of Futurebuilders, had been summoned to answer questions by the committee, which consists of a panel of 15 MPs chaired by Conservative MP Edward Leigh.

When the NAO report was published, Leigh said both ChangeUp and Futurebuilders had suffered from "administrative failures" and the financial administration of ChangeUp was "a mess".

He said yesterday that the NAO report was a matter of great concern. "I expect a lot of taxpayers' money has been wasted," he said.

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