Funding pledges 'will be honoured'

The Department of Health has said it will honour all Section 64 contracts for two or three-year grant holders after Acevo threatened legal action.

Voluntary organisations with two or three-year grants will this week receive confirmation that funding for their activities supporting the Government's health and social care goals will continue. Many organisations feared they would not be able to continue providing services after the department informed them earlier this month that a central budget review meant funding for 2006/07 could not be confirmed.

Hugh Taylor, permanent secretary at the Department of Health, gave an assurance the funding would continue in a telephone conversation with Stephen Bubb, chief executive of Acevo, last Thursday.

Three days earlier, Acevo had informed Taylor that it was preparing to take legal action if the contracts went unmet.

"It's ended happily," said Bubb. "But it still raises the unsatisfactory nature of the contractual relationships the sector has."

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