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NCVO has 'underestimated' cuts to devolved nations 1

Finance | Niki May Young | 9 Aug 2011

Scottish and Northern Irish umbrella bodies say figures in the NCVO's Counting the Cuts paper released yesterday have underestimated the level of cuts to the voluntary sector outside of England.

The Scottish Council for Voluntary Organisation (SCVO) has advised it does not think the NCVO's figures took into account the implications of reduction in the Scottish block grant (funding from the UK government to the Scottish government) and estimates that the Scottish voluntary sector could be down as much as £200m by the end of the 2014/15 financial period, rather than the £20.4m reported in the study.

Counting the Cuts estimated that the loss to the Northern Irish voluntary sector would be £7.9m. But Seamus McAleavey, chief executive of the Northern Ireland Council for Voluntary Action (Nicva) said he believes that the NCVO figures are based predominantly on "English, or real figures" because "the impact of cuts are much more advanced in England than Northern Ireland". When the coalition government came into power and set its budget almost immediately, he said, Northern Ireland elections did not take place until the next May and this delayed dealing with cuts by a year. The NCVO figures represent a "harbiture of things to come" for Northern Ireland, he warned.

Counting the Cuts analysed the government's spending commitments up to the end of the 2014/15 period and estimated that the voluntary sector would lose £2.8bn, or around £911m per year. This represents a fall of nearly 7.7 per cent over the four-year period. 

But the SCVO advised "this must be for England only". The Scottish third sector has a turnover of £4.4bn, it advised, £1.8bn of which comes from central and local government. If the 7.7 per cent figure were applied it would equate to £142.3m, significantly higher than the £20.4m figure given by the NCVO. 

"But the most important issue for us is the impact on the block grant," a spokesperson for the SCVO advised.

The Scotland Bill, designed to give Scottish leaders more say over the country's finances, is currently passing through parliament. Under the Bill the UK Treasury will deduct 10p from standard and upper rates of income tax in Scotland and give MSPs the power to decide how to raise cash. A corresponding reduction in the Scottish block grant will see Scotland's budget reduced by approximately £1bn. 

"If we assume that the Scottish government, and subsequently local authorities and government agencies, were to pass that cut on to the voluntary sector, the total cut would be £203,280,000," said the SCVO spokesperson.

The umbrella body does not, however, believe that will be the case. John Downie, director of public affairs, said:

"We are confident that the Scottish government will not pass on a cut of anywhere near this size but continue to invest in the third sector, to ensure that the sector can increase its economic contribution, have a stronger presence in delivering public services and to use its expertise in employability to create opportunities for our young people."

McAleavey advised that Nicva and other sector bodies in Northern Ireland are working closely with government on mitigating the cuts to avoid "damage by accident" to the sector.

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