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London homeless services in limbo over £3.28m cuts

December 08 2010
Boris Johnson comes out against what others have called "a political and flawed process"

On October 22, New Horizon Youth Centre was named runner-up in the prestigious 2010 Andy Ludlow Homelessness Awards. Just weeks later, the Camden-based day centre for homeless young people is facing a 75 per cent cut in the funding it receives from London Councils - the same organisation that runs the awards.

And New Horizon is not alone. London Councils is set to slash provision for many of the services it funds under its Grants Scheme. Currently, the scheme provides £26.4million in grants to more than 300 volunteer and community organisations across London every year. This funding comes from all 33 London boroughs, whose contributions vary according to their population.

However, in a meeting on 25 November, the members of the Grants Committee - one from each of the 33 London Councils - recommended the scheme be cut by £16.9million. An estimated 22 frontline groups delivering services to tackle homelessness are set to lose funding to the tune of £3,280,000 per year, with some having agreed funding streams cut short.

These organisations are now anxiously waiting for 14 December, when the Leaders Committee will decide whether not to approve the Grants Committee's recommendations.

 

Pan-London vs local

The recommendations from the Grants Committee include a re-classification of each of the services currently funded, dividing them into 'London-wide' (Category A), 'sub-regional' (Category B) and 'local' (Category C). According to Noella Bello Castro, media officer at London Councils, the recommendation is that "those services which can only reasonably be run on a London-wide basis (Category A) continue to be commissioned on a pan-London basis.  For those services in Category C, the recommendation is that there be an additional three months of funding after March to allow more time to establish which services should continue to be funded locally ... the review of the grants programme has not been about whether a service is important or necessary. It's about deciding what services should continue to be provided on a pan-London basis and which ones can be commissioned locally."

In a letter (dated 12 November) to Lewisham Mayor Sir Steve Bullock, who is Chair of the Grant Committee, Boris Johnson frankly expressed his reservations at this system: "In focusing your grants programme on those services you have identified as pan-London (category A), you are overlooking many important 'local' services (category C) which do actually operate across borough boundaries and which I fear would not be commissioned locally. For example, I am committed to ending rough sleeping in London and am concerned that almost all the homeless services have been categorised as local in nature."

Ironically, it was the same Sir Steve Bullock who presented New Horizon Youth Centre with its award (plus a cheque for £10,000) in October. At the time, the Grants Committee was still considering its recommendations regarding the future of the Grants Scheme. New Horizon had been busy lobbying the leaders and members of London Councils, so the centre's director Shelagh O'Connor took the opportunity to speak to Sir Steve. "I said to him: 'Steve, what is your position and where do you think the consultation is going to end at?'", she told The Pavement, "And he said, 'Well, I can reliably inform you, Shelagh, that homelessness will go from being regarded as a local category into the pan-London [category]'". When she later heard two of the services provided by New Horizon (Service 44 - day centre and drop-in facilities for homeless people and people at risk of homelessness, and Service 52 - Reduce youth homelessness through targeted prevention activities with at risk groups) had been classified as 'Category C', Ms O'Connor said "I was very disappointed and kind of saddened by that". The only New Horizon service that has been classified as Category A is Service 65 - Provide routes out of prostitution and associated violence and abuse through outreach, counselling, and support and advice for women - which does not even relate to homelessness.

This wasn't the first time Sir Steve had advocated re-classifying homeless organisations. In the Grants Executive meeting on 19 October, he is reported in the minutes as having said "there were a number of areas emerging, like Homelessness, that were clearly of a London-wide basis."

In a statement from London Councils, Sir Steve Bullock said: "Members of the Grants Committee have recommended the continuation of a grants programme focusing on pan-London commissions within a set of agreed priorities. These include services, such as those to do with homelessness and domestic violence, where there is often no clear relationship with an individual borough."

This would seem to indicate that the homeless services provided by New Horizon and other homeless voluntary organisations have been reclassified as 'Category A' (pan-London). However some attendees of the Grants Committee meeting on 25 November found that 'prioritising' a service didn't necessarily mean it would continue to be funded under the Grants Scheme. The Voluntary Sector Forum (VSF), the independent network of all the voluntary and community organisations funded by London Councils, for instance, reported "anomalies in the funding priorities and categorisation, for example frontline homelessness services, specialist legal and advice services, crime reduction and hate crime services, which are priorities but categorised C."

According to the VSF, the meeting was "a demonstration of a political and flawed process clearly motivated by budget considerations... The discussion was focused on 'balancing the books' of future priorities rather than the priorities themselves. This is a conflation of different agendas - budget vs priorities, which is leading to confusion and lack of transparent decision-making."

 

Funding fall-out

In theory, the cuts to the Grants Scheme will mean more money for London authorities to invest in the services within their borough, such as those whose funding has been cut. However, Ms O'Connor is dubious that this will happen: "You will not see the money that they are saving, repatriated from the London Councils pot back to the boroughs [and] focused on delivering services for homeless people, it's going to be eaten up, as we well know."

Boris Johnson's letter to Sir Bullock made the same point, adding "I recommend that the proposed changed should not reduce London-wide funding disproportionately to reductions in borough-level funding." He also warned that a move to local commissioning "may well result in additional costs, unnecessary disruption or complete loss of services."

The drastic cut in funding is a real concern for New Horizon. "The prospect of increasing our fundraising from, say, £600,000 a year to £1million a year is really daunting," said Ms O'Connor. New Horizon Youth Centre is currently three-quarters of the way through a four-year London Councils Funding Stream and faces losing 75 per cent of its funding from the Grants Scheme. This constitutes 45 per cent of its annual budget - in real terms, a drop from £400,000 a year to around £100,000.

"We understand we're not living in isolation here, and we understand all the pressures and cuts," Ms O'Connor said. "We are doing everything to make efficiency cuts here, examining every strand of expenditure and looking at ways of increasing income, for example through renting out bits of the building. But this is an unprecedented cut."

Recently, the government's My Place funding stream enabled New Horizon to secure a £1.5million capital grant from the Lottery to refurbish and expand the day centre. Implementing cuts so soon after this positive investment has been questioned by many, including Channel 4 broadcaster Jon Snow, who worked at New Horizon Youth Centre for three years back in the 1970s and has been chair of its management board since 1986.

"Our recently rebuilt centre is a superb state-of-the-art facility with kitchen, launderette, counselling rooms, recreation, computer and literacy provision, and a lot more that enables us to get young people housed, employed, educated and rehabilitated," he said. "Cutting off New Horizon's revenue funding in the immediate aftermath of a brilliant capital development doesn't feel very 'joined up'. This is a £1million-a-year project employing 34 staff seven days a week 365 days a year. We achieve results that the state is candid about being unable to achieve."

For Mr Snow, the centre's work is vital: "When we see these young people, they have fallen through every other element of the welfare state. Very often they have been failed by the care system; they have no tangible family, and are extremely vulnerable. Some are caught up in sex working, others have turned to drugs and alcohol, and still others are suffering from clinical depression. Nearly all are neither housed nor employed... It [cut in funding] will of course threaten the scale and quality of what we can do at a very profound level."

 

Response and action

A consultation process, closed on 10 November, gave service users and providers a chance to have their say on the Grants Committee proposals. Many took up the offer, says Ms O'Connor: "Every homeless organisation, every member of staff here, the management council, young people... contributed to the consultation. But it seems to have been a paper exercise that nobody's taken any notice of."

The responses received in the consultation mirror the concerns and issues currently being raised. Of the total responses received online, a dramatic 73.5 per cent oppose the proposals for changes to the Grants Scheme. A summary of the feedback even advises: "it is important to note the concerns raised in the consultation exercise that services where mobility of clients is key to delivery (eg, Domestic violence, homelessness) should not be commissioned at a single borough level".

As well as contributing to the consultation, many of the volunteer organisations have been busy lobbying, protesting, writing letters and organising petitions. Outside of the homelessness sector, three voluntary sector organisations even launched judicial review proceedings against London Councils, saying they had no choice but to act now as the process to date has been so unfair and the timetable so tight. However, according to London Councils, the judge has said that this is premature and has asked that they resubmit after 22 December.

Meanwhile, VSF has been contacted by many groups who feel that the service they have been commissioned to deliver has been wrongly categorised and that they should be able to appeal against that decision. It is now calling on London Councils to "rethink its approach to the future role and scope of the London Boroughs Grants Scheme and to give sufficient time to assess the needs of Londoners, evaluate the current commissioning programme and its achievements, think through options in an informed way and develop a new scheme that meets all these requirements."

It also requests that if this revised scheme requires a transition period for the cutting of funding, it should be at least six months - although ideally calls for London Councils to honour all existing arrangements.

For now, New Horizon just wants all its services to be regarded as pan-London. "We're based in between Euston and St Pancras [but] we're seeing young people from throughout London," explains Ms O'Connor. "We've got to realise - and I'm sure councillors do realise - that actually homeless people are transient, and regarding homeless people as fixed to one borough is ridiculous."

 

The Voluntary Sector Forum, which is coordinated and hosted by the London Voluntary Service Council, together with the BME Advice Network are organising a peaceful protest to take place outside the London Councils building at 591-2 Southwark Street, London, on 14 December at 10am.

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