Archived decisions

Item 7

Hampshire County Council

Culture and Communities Policy Review Committee

18 January 2007

Review of annual revenue funding to community associations

Report of the Director of Recreation and Heritage

Contact Margaret Plumridge ext. 6173 e-mail: [email protected]

1. Summary

1.1 The annual revenue funding scheme available to community associations has been in place for some years. The scheme has recently been reviewed against the Hampshire Compact Funding Code and tested as to its continued relevance to the Council Council's Corporate Priorities and Business Strategy.

1.2 The review has highlighted a number of issues:

    i) The scheme needs clearer and more consistent criteria for the allocation of the funding,

    ii) In its current form it is difficult to evidence that the grants are providing `value for money' in terms of meeting the County Council's objectives,

    iii) That the organisations being funded need to have plans to ensure the increased effectiveness of their delivery of services to the public.

1.3 As a result a pilot scheme has been devised that is being trialled in 2007/08.

2. Background

2.1 There are 105 community associations in Hampshire and in 2006/07 the county council was able to provide annual revenue funding to 23 of these organisations. There are two organisations that are currently supported by seconded staff - Lymington Community Association and Leigh Park Community Association. Leigh Park is also one of the 23 supported organisations therefore out of the 105 community organisations the county council is supporting the core revenue costs of 24 at a cost of £199,000.

2.2 The table set out in Appendix 1 shows that over time the majority of recipients have seen their funding taper off as they become more financially self-sufficient. This has enabled new organisations to be supported and increased the funding available to support the areas of relative deprivation in Leigh Park, Wecock Farm in Cowplain, River Way in Andover, Headley Down near Bordon, Winnall in Winchester and Rowner in Gosport although the latter is temporarily disbanded but in the process of re-building its trustee base.

3. Current scheme

3.1 The annual revenue scheme, as it has operated up to the financial year 2006/07, has been a `closed grants programme'. It is not advertised in the public domain simply because it would not be possible to fund all 105 organisations in Hampshire from within the available budget. The current scheme makes it difficult to provide funding to organisations other than those that are already in receipt of funding. There are a number of organisations with whom we are working that would benefit from some assistance such as Colden Common near Winchester, Butts Ash in The New Forest, King Arthur's Way in Andover and Springwood in Waterlooville the latter three being in areas of relative deprivation.

4. The current financial criteria

4.1 It is current policy to seek gradually to reduce support to the majority of community associations and they are advised in the notes accompanying the application form to develop business practices that will eventually enable them to be self financing. However, it is recognised that this is much more difficult in areas of deprivation.

4.2 Currently, funding support is linked to the predicted financial deficit of the applicant association. This tends to encourage organisations to predict a deficit in order to obtain funding. Furthermore any reduction in our funding support because of their improved financial position is considered by the applicant organisation to be a penalty for their prudence. It is for these reasons that in most instances the funding to these organisations has remained static. Only by not adding inflation each year has actual support reduced.

5. The role of community associations in their local communities

5.1 In their recent publication `Changing places, Changing lives' The Community Alliance suggests that a community anchor organisation is a multi purpose organisation that provides a range of services and supports the communities they serve. This is a good general description of the function of a community association. Consequently all 105 organisations are by definition identical. However, there are major differences in the way they operate within this framework. At one end of the scale there are those who tend to act as a hiring agent for a local community building much as a village hall trust does. At the other end there are those organisations who are involved in community planning, community development and activities that make provision for local people such as the extended services programme, activities for young people, silver surfers, adult education and a wide range of social activities.

6. Assessing value for money

6.1 In an attempt to assess value for money, the application process 2006/07 included a request for some detail from applicant organisations about their proposed activities as they related to some specific county council projects. (See Appendix 2). This produced a mixed response with some organisations

    clearly demonstrating that they were managing some very good local projects whilst others provided little or, in a few cases, no positive response. Clearly the annual revenue funding scheme will have more impact locally if it is provided to organisations who are pro-active in their communities and are able to demonstrate this rather than those who are tending to act mainly as building managers.

7. Issues relating to the Hampshire Compact Funding Code

7.1 When the existing scheme was considered against elements of Hampshire's Compact Funding Code a number of issues came to light that needed to be addressed.

    i) Section 1.4 of the Compact Funding Code states that `the county council will allocate resources against clear, transparent and consistent criteria. This will take account of county council priorities and value for money, together with the principles of equality, effectiveness, sustainability and accountability.'

      While the current scheme may be supporting the Council's objectives and providing value for money the evidence being provided by the organisations is mainly through the production of activity timetables. These relate only to their building management processes and it would be possible for those organisations not currently funded to produce similar information.

    ii) Section 8.2 of the Compact Funding Code outlines that those

      organisations that are funded by the county council should operate effective employment and management arrangements, appropriate financial controls and compliance with appropriate legislation. The current scheme has had limited success in assessing these requirements.

    iii) Consideration has also been given to the amount and type of information being requested from the organisations as part of the application process.

8. The pilot scheme for 2007/08

8.1 Funding from the annual revenue scheme would have more impact locally if it is provided to organisations that are pro-active in their communities rather than those that are tending to act as building managers and this was taken into account when developing the pilot scheme. As a consequence greater emphasis has been placed on the development of new project activity that helps to meet county council and departmental outcomes. This approach enables a more effective assessment of the activity of the applicant organisation and would in the future allow for criteria to be designed that will enable an assessment to be made of the activity of one organisation against another. It is conceivable that this would eventually allow the annual revenue programme to become an open scheme available to all community associations in Hampshire. It would also be more in keeping with the fair and accountability conditions as indicated in the Compact Funding Code.

8.2 Three changes have been included in the pilot. Firstly, information collected about the financial and legal position of the organisation has been limited to information that should be readily available by any community association that has appropriate financial and management controls in place. Secondly, organisations applying for funding are also being asked to demonstrate that the trustees have, or are developing, an appropriate business strategy that encourages the sustainability of their organisation and building. This should pose no problem for any properly managed organisation. Thirdly, associations are being asked to provide a minimum of 15 hours new activity in 2007/08 and provide evidence that it is meeting county council and departmental outcomes.

8.3 The funding being provided in the pilot scheme has been split into two parts :-

      60% as core annual revenue funding

      40% to support the 15 hours new project activity

    The scheme criteria is arranged so that 60% core annual revenue funding is available to organisations provided they can demonstrate that they are regularly reviewing and updating their business practices (See Appendix 4 page 4).

    The rest is available as project funding to organisations who are able to provide a minimum of 15 hours new activity in 2007/08. (See Appendix 4 pages 2 - 4).

8.4 The Community Support Team have designed a series of project toolkits for those organisations that would like to take part but have asked to be supported through the process.

8.5 In order to build up the special projects budget that is available to all 105 community associations it is proposed to apply a small reduction (2%) to those 13 organisations not in areas of relative deprivation and receiving annual support above a minimum £3,500 core funding threshold. The special projects budget supports targeted work such as Silver Surfers, activities for young people and leading a healthy lifestyle through participation in physical activity. The reductions involved range from £100 to £240 in a full year.

8.6 Once the new scheme is bedded in it is intended to make this a three year funding programme in line with other funding programmes.

9. Impact Assessment

9.1 As with the previous scheme organisations applying to this programme are by their nature defined as accessible to all members of the community. This is embodied within their charitable objects, therefore no groups or organisations should be excluded from any benefit arising from these decisions.

LINK TO CORPORATE STRATEGY

                  Yes No

Hampshire safer and more secure for all

Maximising well-being Ö

Enhancing our quality of place Ö

Section 100 D - Local Government Act 1972 - Background Documents

    The following documents disclose facts or matters on which this report, or an important part of it, is based and has been relied upon to a material extent in the preparation of this report.

    The list includes:

    Published works

    Documents, which disclose exempt or confidential information as, defined in the act.

    Title Location

Changing Places, Changing lives Recreation and Heritage Department

A introduction to the Community Mottisfont Court

Alliance's Community Impact Winchester

Programme

Bassac

Making Community Buildings Recreation and Heritage Department

Work for People - a research Mottisfont Court

study into the sustainability of Winchester

community buildings.

Civic Trust and Community

Investors Development Agency