The move to a new, reduced local fund has put over 80 roles at risk at charities delivering employability support services in Northern Ireland (NI).
In last year’s spending review, the UK government announced a new targeted approach to local growth funding to drive growth and strengthen communities across the UK.
As part of this, in April, it launched the Local Growth Fund, “with a focus on supporting each nation to deliver long-term investments for sustained economic growth”, it said.
The fund, which replaces the UK Shared Prosperity Fund (UKSPF), is worth £815m over three years in Northern Ireland, Scotland and Wales and more than £900m over four years in England.
In comparison, the UKSPF, which itself succeeded the old EU structural funds, was worth £3.5bn between 2022-23 and 2025-26.
In January, NIVCA estimated that under the new model, funding to tackle economic inactivity would fall by 64%, from £25m to £9.2m per year, due to an imposed 70% capital / 30% revenue split.
The membership body warned that this could remove life-changing support from over 11,000 people annually and put at least 400 skilled voluntary and community sector jobs at risk.
Action Mental Health told Civil Society that it is the lead partner of a pan-disability group of seven charities that delivered employability support services under the UKSPF in NI.
A spokesperson for the charity said the funding cuts “have put over 80 full-time equivalent roles at risk across the partnership”.
“The cuts also mean around 1,700 less people can be supported this year by our partnership,” they said.
Government mishandled local growth fund
In a recent debate on voluntary and community sector funding in the NI assembly, MLAs criticised “the mishandling of the local growth fund by the British government”.
Diane Forsythe, chair of the all-party group on the voluntary and community sector, said it is “appalling” that voluntary and community sector organisations, “which do essential work, have been left in such an uncertain position”.
“In particular, the 70:30 capital/revenue split has caused major concern that 11,000 people a year may lose support,” she said.
“Put simply, there isn’t enough capacity within existing statutory services to replace the loss of the programmes, and that’ll undoubtedly mean that individuals will be denied access to services, resulting in negative consequences for health, well-being, economic development and skills growth across our province.
“We want to see the previous spending power under the EU structural funds be replicated and enhanced.
“The UK always paid more into the EU than what it received back in structural funding. There therefore can be no excuse for any shortfall in funding now.”
Public consultation
Earlier this month, the NI Office launched a public consultation on the proposed £129m three-year investment plan for the new Local Growth Fund in Northern Ireland.
The office, which is the UK government’s centre of expertise on NI, said the responses will help shape how that investment is targeted to ensure maximum impact across NI.
Kathy Maguire, policy development officer at NIVCA, said: “The transition to the Local Growth Fund has already had huge impacts for the voluntary and community sector and the people it supports, with a 64% reduction in previous levels of economic inactivity investment from 1 April dramatically reducing the scale and range of services and supports the sector is able to provide with widespread consequences for organisations, staff and service users.
“As we look towards programme delivery beyond March 2027, it’s critical that the voice of the sector – and the communities it supports – is clearly heard as part of this consultation.”
The consultation closes on 26 June.
