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Concerns over co-financing greets new round of ESF funding

Fundraising | 10 Sep 2007

The tendering process for a new programme of European funding aimed at helping disadvantaged people into employment will launch in October amid renewed concerns from voluntary and community groups that they will have difficulty accessing the funds.

For the first time, the 2007-13 programme for the European Social Fund will be delivered entirely through co-financing, using a competitive tender process open to both the private and public sectors.

However, the funding available to England for the period has been halved from £4bn to £2bn since the 2000-6 programme, because the European Council decided to focus funds on the new member countries of the EU. A further £2bn will be raised through co-financing.

A full list of co-financing organisations will not be available until October, although a spokesman for the Department of Work and Pensions (DWP) said it was expected that Learning and Skills Councils, and the DWP's Delivery Directorate would be the main co-financers alongside some Regional Development Agencies and local authorities.

Sandra Turner, director of umbrella group the Third Sector European Network (TSEN), said it was "touch and go" how the voluntary sector would access the funds through co-financing as there were concerns that some co-financers may lean towards their existing clients. "We need to wait and see who's going to be left out," she said. "There are low expectations in the sector. I think the morale is very low."

In a survey last month the London Voluntary Sector Training Consortium (LVSTC), which helps voluntary groups in London access European funding, found that 41 per cent of its members were not sure about how to access the next ESF programme and 16 per cent were not at all confident of securing funding.

One respondent said the new programme might be good for large providers but it could not see how smaller organisations could take part. Another said: "The new ESF system does not give the voluntary sector much encouragement. It looks as if the sector is being overlooked in preference to private and public sectors."

Tamara Flanagan, director of European affairs at CSV and chair of the TSEN, raised concerns that the co-financers would look to fund projects that could deliver firm outcomes designed around getting people into work. She said this could leave funding "fairly scant" for smaller organisations working with excluded people such as those with mental health problems who dipped in and out of training programmes and could not guarantee outcomes. "I think not only will it be difficult for those working with the excluded, but co-financers will be slightly risk-averse and the way they organise will be against outcomes."

Flanagan said CSV was concerned that national projects that were previously able to access ESF funding would no longer be able to because of the devolution to regional agencies. "The regions are going to be very much in the driving seat" I think there will be whole tranches of our constituents that won't be able to benefit from the ESF." She said CSV was considering forming consortia with other regional organisations in an effort to secure funding.

A spokesman for the DWP said the regional delivery of the 2007-13 programme of ESF funding completed a process of decentralising delivery to the regions begun in 1997. "Third sector organisations will continue to have an important role to play in delivering ESF to people who are disadvantaged in, or excluded from, the labour market," he said. He added that there were no guidelines on how much ESF funding should be delivered through the voluntary and community sector as this would be against European tendering rules.

Delivery of the ESF programme will be based on a prime-contractor approach, meaning organisations can either bid to deliver services using sub-contractors or as a sole provider. Bidders will be required to submit an electronic Pre-Qualification Questionnaire (PQQ), followed by a more detailed tendering document if they are successful at that stage.

The PQQs will be published on the DWP's website on 3 October and will be followed by a series of PQQ briefing events. A full timetable for the tender process can be found at www.dwp.gov.uk

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Directory: Office of the Third Sector