Sector will lose £110m in local authority funding, says False Economy

Union-backed website estimates that more than 2,000 charities will lose funding this year, with Liverpool and Birmingham making the biggest cuts

Liverpool among councils cutting voluntary sector funding
Liverpool among councils cutting voluntary sector funding

The voluntary sector will lose more than £110m in local authority funding this year, according to new figures obtained by the union backed anti-cuts campaign website False Economy.

It used the Freedom of Information Act to ask councils whether they would raise or cut their funding for charities and community groups in 2011/12, and by how much. It has today published the responses it received from 265 local authorities.

False Economy estimated that more than 2,000 charities would lose funding because of the cuts.

Liverpool City Council and Birmingham City Council are listed as making the largest cuts, with Liverpool slicing £18m from its budget for the sector, from £37m in 2010/11 to £19m in 2011/12, and Birmingham reducing its voluntary sector budget by £15m.

Sunderland City Council said it would cut £10m from funding for charities and community groups, and Sheffield City Council said it would cut £8.5m. Several councils said this was due to the loss of funding from national schemes run by central government, including area-based grants, the Supporting People fund and the Working Neighbourhoods fund.

London Councils, the umbrella body for the capital’s 33 local authorities, said its voluntary sector grants budget would fall by more than £11m over two years, from £15.5m in 2010/11 to £4.1m in 2012/13.

Some councils said they would increase their funding for voluntary groups. The City of London said it would increase the budget by £5.1m, although this included £5.4m of new funding for the Museum of London.

Ashford Borough Council in Kent said it would increase third sector funding by £837,000 and North Yorkshire County Council said it would do so by £780,000.

False Economy said the figures were obtained by sending requests under the Freedom of Information Act to councils between March and July 2011.

It said the figures should be treated as guidelines only, because some councils might have provided inaccurate information or revised the figures since submitting them.

In a statement, Clifford Singer, campaign director at False Economy, said: "Ministers talk up localism and say services will be better shaped locally, but the huge front-loaded cuts to councils mean that local decision-making simply gives councils the choice of which vulnerable people they should make suffer for an economic crisis they did nothing to cause."

A spokesman for Liverpool City Council said the voluntary sector cuts had to be seen "in the context of the city council having to reduce its budget by £141m over two years".

He said: "The city council still has one of the largest discretionary payment programmes and will be funding the voluntary sector by at least £19m in the next year, despite cuts of £18m."

Councillor Sue Anderson, third sector champion at Birmingham City Council, said: "Birmingham City Council is committed to providing more than £25m this year for approx 1,800 organisations.

"Decisions around funding have to take into account local and national priorities as well as budget restraints – Birmingham City Council has to save £212m this year and all spend is therefore being reviewed to ensure value for money."

The biggest cuts

Figures for the financial year 2011/12

- Liverpool City Council £18m

- Birmingham City Council £15m

- Sunderland City Council £10m

- Sheffield City Council £8.5m

- London Councils £7.7m

The biggest rises

Figures for the financial year 2011/12

- City of London £5.1m

- Ashford Borough Council £837,000

- North Yorkshire County Council £780,000

- Reading Borough Council £429,000

- Tendring District Council £390,000

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