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Policy Briefing 11 October 2011
(27 September 2011 - 11 October 2011)
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Once again the economy managed to overshadow recent political events. As the party conference season drew to a close, the ONS published revised figures showing that GDP grew by just 0.1% over Q2 2011, leading to the Governor of the Bank of England Mervyn King describing this as “the most serious financial crisis at least since the 1930s, if not ever.” A further £75bn round of quantitative easing was announced in response to such consistently low growth figures, a process which involves the Bank of England purchasing Government bonds from commercial banks in order to stimulate lending.
The Labour Party conference took place in Liverpool this year with the leader Ed Miliband using his conference speech topromise a “new bargain” for the country. Ed Miliband also sought to define a role for so-called “good business” - based in the community, committed to its workforce, and creating lasting value. Policy announcements at the conference included the reduction of tuition fees to £6,000 per year, a requirement on companies contracted to deliver public services to employ apprentices, a reversal of the 2.5% VAT increase, and a new bonus tax on bankers to finance an additional 100,000 jobs for young people and 25,000 affordable homes.
The Conservative Party Conference convened in Manchester under the strap line “Leadership for a Better Future”. Cameron’s conference speech called for discipline, unity, and purpose in order to address the crisis caused by “too much borrowing, by individuals, businesses, banks, and most of all, governments”. New policy announcements at the conference included a “credit easing” plan involving off-balance-sheet lending to small business, the reform of employment tribunals, and a new version of the “right to buy” policy under which council tenants are encouraged to buy their own homes in order to help finance the construction of an additional 100,000 new affordable homes.
The latest opinion polling post-conference season has shown a narrowing Labour lead (42%), with the Conservatives in close second place (38%), and the Liberal Democrats languishing in third place (9%).
Skills & Workforce
Employers are being called to identify how employment regulations can be improved, simplified or abolished as part of the Government’s “Red Tape Challenge”. For the next three weeks the public are being invited to comment on more than 160 different cross-Government employment related regulations (including collective redundancies, immigration checks, the National Minimum Wage and statutory sick pay). Alongside this, a paper has been published by BIS which seeks views on labour market reform.
The qualification period for an employee’s right to claim unfair dismissal will be doubled to two years from 6 April 2012. This follows the Government’s recent consultation, ‘Resolving Workplace Disputes’. It is estimated that planned reforms will lead to 2,000 fewer claims per year in addition to £6m per annum cost savings to the UK economy.
A new central online service has been launched to provide clear information and advice on skills, careers and financial support. Lifelong Learning Accounts will enable individual users to access a skills diagnostic tool to identify their interests, strengths and needs; localised course and job searches; a CV builder; an ‘eligibility checker’ to identify public funding support; and a facility to store personal learner information. The new accounts are accessible through the Next Step careers service website.
The Department for Business, Innovation & Skills (BIS) have announced details on how £11 million of Government match-funded support will be awarded following the first round of bids to the Growth and Innovation Fund. The successful bids, which aim to enable employers to deliver more effective skills solutions on a sectoral basis, include a National Skills Academy for health, a Renewables Training Network for the energy sector, a Group Training Association for sport & active leisure, and an Institute of Employability Professionals.
Catalyst - a consortium of four organisations working with the Department for Education - has launched a consultation seeking views on the proposed formation of an Institute for Youth Work. The first phase of the consultation will be to identify whether the notion is widely supported by the sector. If so, a second phase will explore the details of governance, functions, services and membership. The consultation will run until 30 November 2011.
The Skills Funding Agency has published the results of a survey of colleges and training organisations. The survey, which is the first of its kind, explores the role of the Agency, how it operates, and how it communicates to providers. The survey discovered “a degree of turbulence” in relation to the recent introduction of minimum contract levels for providers. CEO of the Agency, Geoff Russell has commented on the results in an article here.
The Department for Education has announced proposals to overhaul the funding of post-16 education. Under the proposals, schools and colleges will be funded on a per student basis rather than per qualification and all students aged 16 to 19 without an A - C in GCSE English and Maths will continue to study those subjects until they achieve good grades.
The annual monitoring report on widening participation in higher education over 2009/10 has found that over 23% of institutions have not met their targets. The report, jointly-published by HEFCE and the Office for Fair Access, found that £1,574.1 million in income was generated from fees charged above the basic tuition fee, of which 25% was spent on access measures and 23% was spent on bursaries and scholarships.
The Care Quality Commission has published its third annual report into the state of health and adult social care in England. The State of Care covers four main areas – the shape of health and social care provision; access to care services; choice and control; and quality and safety. This is the first report to be published under the new registration and regulation system instituted by the Health and Social Care Act 2008.
Politics
The Health and Social Care Bill will receive its second reading in the House of Lords today. Due to the Bill’s broad implications, this will take place over two days and will involve the contribution of nearly 100 peers. Two crossbench peers - Lords Owen and Hennessey - have also tabled an amendment calling for part of the bill to be sent to a special select committee for further scrutiny.
A new Code of Recommended Practice has been issued to guide local authorities in the publication of data. The code calls upon local authorities to publish data on all expenditure over £500; employee salaries over £58k; copies of contracts and tenders; voluntary sector grants; external audits and key inspections; the location of public land and building assets; and data on the democratic running of the authority. The Code has been published under the Local Government, Planning and Land Act 1980 and allows for the introduction of subsequent regulation felt necessary to enforce greater transparency.
HM Treasury has announced that Council Tax rates will be frozen for 2012-13. This second year’s council tax freeze will be supported by £805 million of Government funding. A new grant scheme will also be open to all authorities that decide to freeze or reduce their council tax next year. If they do, councils will receive additional funding, equivalent to raising their 2011-12 council tax by 2.5%.
Housing Minister Grant Shapps has announced a new “right to reclaim” under which communities are encouraged to reclaim and develop unused public sector land and buildings. Members of the public will be able to request the sale of land and buildings held by either local or central government by filling in a ‘simple and user friendly’ form. The Government is also looking to extend the ‘Build Now, Pay Later’ model to support those struggling with cash flow problems, enabling them to start building homes without bearing the upfront costs of the land.
The Work & Pensions Secretary Iain Duncan Smith has warned against the threat of “Benefit Tourism” caused by the implementation of a new EU Settlement. In a newspaper column, the minister warned that the new settlement on the free movement of labour will “pose a fundamental challenge to the UK’s social contract” with an estimated £2bn in extra benefit payments annually.
An additional £300 million will be invested into childcare support under the Universal Credit welfare scheme due to be introduced in 2013. This will support 80,000 more households, is in addition to the £2bn already spent under the current system, and will remove the requirement that support is only available to those who work at least 16 hours per week.
The number of looked after children reached 65,520 in 2011, the highest level since 1987 and an increase of 2% on last year. The vast majority of looked after children (74%), were in a foster placement. The number of adoptions fell to 3,050 which is 5% fewer than in 2010. The number of children placed for adoption also fell to 2,450, a reduction of 2% on 2010. In addition to this, the proportion of care leavers not in education, employment or training has increased from 32% in 2010 to 33% in 2011. Children’s Minister Tim Loughton described the statistics as “worrying”.
Full statistical information on aid spending has been released by the Department for International Development (DfiD). The figures show that in 2010/11 the UK’s Gross Public Expenditure on Development amounted to £9,007 million, of which the DfID aid programme accounted for 85% of expenditure.
Ed Miliband has elected to alter several positions following new rules allowing the Party Leader to change the membership of the shadow cabinet. New MP Chukka Umunna has taken on the shadow brief for Business, Andy Burnham has reclaimed the shadow Health role, and Stephen Twigg is the new shadow Education secretary. Meanwhile, Gareth Thomas will replace Roberta Blackman-Woods as the new Shadow Minister for Civil Society.
The Voluntary Sector
The Social Action Fund has now opened for applications. The fund will be managed by the Social Investment Business and will distribute over £20m in grants of £100,000 or more to initiatives from the voluntary or private sector which ‘expand volunteering and giving of time, money, knowledge and assets’. It will focus on three priorities – community-based social action; projects which help build upon the 2012 Olympics; and projects that motivate people across all generations to get involved in volunteering and charitable giving. The closing date for applications is 2 November 2011, with a second application window due to open in early 2012. Full criteria for the fund are available here.
The Community First grants fund is now seeking members for 600 grant-giving panels. The fund will be managed by the Community Development Foundation and will distribute £30m in funding to the 600 most deprived wards in England through panels set up by people living in the area. Each panel will have between £17,000 to £200,000 to redistribute over a four year period. In order to receive the money, projects must match fund through either money or volunteering. In addition to this, £50 million of funding will be used to match private donations invested in community endowment funds.
The BIG Lottery Fund has announced £110m in funding for projects which ‘help older people manage life-changing events and encourage them to get more involved in their communities’. The Silver Dreams fund will provide initial grants of between £50,000 and £200,000 amounting to a total of £10m. This will then shape the deployment of a further £100 million investment of Lottery money for older people between 2012 and 2015. Interested organisations have until Friday 28 October to submit outline ideas
The first wave of community organisers have begun a twelve month training programme based in local community groups in eleven places in England. The 47 community organisers were recruited by host organisations in 11 communities selected by the national partner organisation, Locality.
Voluntary organisations working with DWP to deliver the Work Programme have been told that they cannot publish their own data on the programme. A spokesperson from DWP told Third Sector magazine that data relating to the Work Programme must go through the “proper process” and will be published via the Office for National Statistics in due course.
The Prime Minister has announced that the National Citizen Service (NCS) will treble in size to offer 90,000 places by 2014. This follows initial evaluation of the current year’s pilot by the Challenge Network, the largest NCS provider so far, which reported that over 15,000 young people expressed interest for 3,200 places, with almost a 100% attendance rate, and 66% of participants having had no prior experience of other voluntary youth programmes.
Confidence levels reported by charity leaders are at an all time low according to the findings of NCVO’s latest Charity Forecast Survey. The figures cover the third quarter of 2011 and show that 98% of charity leaders expect economic conditions within the sector to be negative over the next 12 months, the lowest level since the survey began in May 2008. In addition to this, 38% of respondents had plans to increase their services over the next three months, whilst only 22% planned to increase staffing levels over the next three months.
New guidance has been issued by the Institute of Fundraising pertaining to the handling of cash and other financial donations. The guidance aims to cover three purposes - to protect an organisation from fraud, theft or embezzlement; to protect staff or volunteers from accusations of dishonesty or the temptation to commit fraud; and to assure donors that their donations and gifts are used for the purpose for which they were given.
Atlantic Bridge, the charity founded by under-fire Defence Secretary Liam Fox in 1997 to advance research on relations between Europe and North America, has closed. This follows criticism from the Charity Commission last year that it was pursuing activities too closely aligned to the Conservative Party policy agenda. The charity was wound up on 23 September and removed from the register of charities on 30 September.
Think Tanks & Research
Mismatches between workers’ competences and what is required by their job are widespread in developed countries according to a new report by the OECD. “Over-Qualified or Under-Skilled: a review of existing literature” found that over-qualification is a temporary phenomenon which is commonly overcome through career mobility and good job matches. Across the board, over-qualified workers were found to earn less than their equally-qualified but well-matched counterparts and were found to be less satisfied about their job and more likely to leave their work.
The think tank Respublica has just published a new report, the Age of Opportunity, which explores how the level of civil engagement among old people can be maintained and increased. The report calls for voluntary organisations to respond to the growing numbers of older people through wider choice of volunteering opportunities and provision of adequate information to those approaching retirement.
The Social Investment Business has published a new report which argues that social impact investment has the potential to evolve from being an emerging market to a very large, mature investment market attracting mainstream investors. Making Good in Social Impact Investment: Opportunities in an Emerging Asset Classargues that the UK is well placed to be a global leader in the field, as social impact investment builds on the UK’s well-developed voluntary sector and historic strengths in financial services.
The think tank Policy Exchange have published a new report on how to reinstate conditionality for jobseekers. The report, Something for Nothing, calls for a new points based system for Jobseekers Allowance which recognises different ‘job-search’ activities. Under this system attending a job interview would earn a greater number of points than putting together a CV or seeking information about a job. Claimants would then have to reach a specific number of points each week to receive their benefits.