A less-than comprehensive review of the Comprehensive Spending Review – Key points from CSR07

A less-than comprehensive review of the Comprehensive Spending Review – Key points from CSR07


Urban Forum

October 2007


The Comprehensive Spending Review (CSR) headlines may all have been about inheritance tax, lower growth forecasts and health and education spending, but it also contained a great deal of relevance to community groups involved in regeneration. Urban Forum sets out some of the major issues for the third sector.



Communities and Local Government


Communities and Local Government did fairly well overall in the Spending Review, with a real terms increase of 2.9% (ie after allowing for inflation). Within this the biggest increase is for housing, with a 50% increase (from 2007-08 to 08-09) in funding to deliver new houses.


Gordon Brown has stated that the government want to build 3 million new homes by 2020, so there will be £6.5bn from 2008-2011 invested in housing. There will also be a further £500m over the same period to encourage local authorities to increase the amount of available housing.


The CSR confirmed that £2bn would be spent on neighbourhood and local renewal, though precisely what this means we’re still waiting to see. Announcements before the Pre-Budget Statement have already signalled the Department’s intention to invest in community anchors, further neighbourhood renewal funding (though greatly reduced from the 1999 level) and further investment in asset transfer and the implementation of the Quirk Review. There will certainly be funding for community empowerment, which Hazel Blears has been championing over recent months, though we have to wait to see how much and how it will be delivered. A small part of this £2bn will presumably be used to establish the Strategic Partners Fund, which has already produced over 200 expressions of interest. The investment in neighbourhood and local renewal will have a greater ‘emphasis on economic development and promoting mixed communities’, though again we will have to wait and see precisely what this means.


Secretary of State, Hazel Blears, had already announced a new £50m fund to promote community cohesion and integration, building on the recommendations of the Commission on Integration and Cohesion.



Office of the Third Sector


Most of the spending plans for the Office of the Third Sector had already been announced with the publication of the Third Sector Review in the summer. A number of funds were confirmed in the spending review.


£80m for a small grants programme for local community groups. There is likely to be an announcement shortly on the appointment of a national partner who will manage the appointment of bodies to distribute the fund locally.


A further £50m will be used to establish local endowment funds to make grants to support community-based activity. A decision on who will manage the programme nationally and develop the process for selecting local delivery partners may be announced alongside the small grants decision. We have already been told that the government expects the endowments to be used to secure additional investment from other sources, though we must wait to see the detail of how this will operate in practice.

OTS have previously indicated that they will make available a fund of £10m to support community anchors, in tandem with CLG, though precisely how much of the £2bn for local renewal Hazel Blears will invest in this is still to be made public.


There will be further investment in youth volunteering, with £117m allocated to youth volunteering charity ‘v’. Capacitybuilders will have £85m to deliver the ChangeUp programme, including the new National Support Services which are currently out to tender. And there will be an additional £65m for Futurebuilders to provide loans and some grants to support the third sector to deliver public services.



Funding for Local Government


Though CLG and OTS may have come through the Spending Review relatively unscathed, the local government settlement is being described by the Chairman of the Local Government Association as the ‘worst settlement for local government in a decade’. Local Authorities get a 1% real terms increase a year for the next three years, compared with an increase of 39% over the previous 10 years. And Local Authorities will have to make efficiency savings of almost £5bn over the next three years, with £150m being earmarked to support this ‘service transformation’ programme. The existing 5% limit for increasing council tax is retained, though under new proposals councils will be able to introduce a new ‘business rate supplement’ to support transport and other infrastructure.


As Local Area Agreements are rolled out nationally the Spending Review confirmed that £5bn of funding which was previously ring-fenced would be pooled into a single grant for local areas.



Public Service Agreements


Alongside the Spending Review, and equally important, was the announcement of a new series of Public Service Agreements (PSAs) which set out the outcomes that government wants to see happening over the next three years. The 30 PSAs are grouped around four headings:


– Sustainable growth and prosperity (PSAs 1-7)

– Fairness and opportunity for all (PSAs 8-17)

– Stronger communities and a better quality of life (PSAs 18-26)

– A more secure, fair and environmentally sustainable world (PSAs 27-30)


Each PSA has a series of performance indicators that will be used to measure progress.

Although many of the PSAs are relevant to the Third Sector and local communities, it is PSA 21 that is probably most important to local community groups.


PSA 21: Build more cohesive, empowered and active communities

(More on PSA 21: Build more cohesive, empowered http://www.hmtreasury.gov.uk/media/E/9/pbr_csr07_psa21.pdf )


The PSA sets out a number of aims and actions related to each of the three elements (cohesion, empowerment and active communities).


Cohesive communities:

– Helping to create a sense of belonging among young people from different communities.

– Supporting the integration of immigrants into communities

– Celebrating and understanding diversity

– Increasing opportunities for everyone to participate in civic life

– Tackling extremism, racism and religiously-motivated crime

Empowered communities:

– Giving children and young people a chance to influence decision-making

– Supporting local communities to influence public policy and public institutions

– Enable citizens to contribute to decisions on how services are delivered and resources allocated

– Involving local people in tackling crime, anti-social behaviour and the criminal justice system

– Working with all communities to improve health and well-being

– Enabling communities to improve their quality of life and sustainable development Active Communities

– Strengthen partnership working between local authorities, the third sector and cultural and sports organisations, including improved commissioning and procurement

– Increase the amount and the quality of small grant funding to support the community sector

– Invest in community anchor organisations and use mainstream regeneration funding to support social enterprise

– Supporting volunteering, particularly among young people and socially excluded groups

– Support local capacity building and local infrastructure to support the community sector

Six indicators will be used to assess progress made against this PSA. They are:


1. The percentage of people who believe people from different backgrounds get on well together in their area

2. The percentage of people who have meaningful interaction with people from different backgrounds

3. The percentage of people who feel that they belong to their neighbourhood

4. The percentage of people who feel they can influence decisions in their area

5. A thriving third sector

6. The percentage of people who participate in culture or sport

A Measurement Annex sets out the fairly technical way in which data will be gathered and collated to assess the indicators. For example, a thriving third sector (indicator 5) will be measured by the number of people who volunteer on a regular basis and the number of people employed in the third sector. These will be collected annually through the Citizenship Survey and the Labour Force Survey.


A delivery strategy for the PSA sets out a range of actions that government will undertake to help achieve their targets. These include:

Communities and Local Government

– Work with local authorities to help them achieve cohesion and empowerment, sharing best practice and providing specialist support where required.

– Respond to the recommendations of the Commission on Integration and Cohesion

– Produce a third sector strategy and invest in the sector’s long term sustainability through community anchor organisations

– Extended neighbourhood management

– Supporting the transfer of assets and their management to local communities

– Extend tenant management, local charters and the use of petitions

Office of the Third Sector

– Support the Commission for the Compact

– Encourage government departments to provide three year funding to third sector organisations

– Invest in v to support youth volunteering and in a Volunteering for All/Guidestar programme to promote volunteering among excluded groups

– Support community capacity building through funding for ChangeUp

– Create a new National Research Centre for the third sector


PSA Consultation

The document states that the government intend to consult key stakeholders on the detailed delivery planning for the PSA in the near future.


For further information

The Treasury CSR website has details of the Spending Review in full – www.hmtreasury.gov.uk/pbr_csr/report/pbr_csr07_repindex.cfm  or for the (slightly more manageable) press notices go to – www.hm-treasury.gov.uk/pbr_csr/press/pbr_csr07_pressindex.cfm


Source: http://www.urbanforum.org.uk