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Last Wednesday (15 June) saw Cabinet Office questions in the House of Commons, which offers a valuable opportunity for the Shadow Cabinet Office team, along with other MPs, to scrutinise the policies and work of the Cabinet Office and to ask a number of key questions (and importantly, to receive a reply!).

A quirk of timetabling has Cabinet Office questions half an hour before Prime Minister’s Questions meaning that we are probably the most efficient and concise shadow team simply as a result of our need to avoid the imminent scramble for seats at 12pm.

Among a number of issues, I pressed Nick Hurd, Minister for Civil Society, on the Government’s approach to charitable giving. It is vital that the Government support and monitor opportunities for giving in light of the current economic climate in order that they are able to first identify and, most importantly, to plug any funding gaps that are likely to arise.

Many charities are currently facing a financial crisis, with fewer resources at a time of increasing demand on many services.  As such, the monitoring of levels of giving is key to ensuring areas such as the North East are not disadvantaged as a result of these financial pressures.

I will continue to press the Government on this important issue and ask for further information about what efforts are being made to both secure and encourage giving in the future. Much of the fantastic work done by the third sector in the UK is a result of the financial assistance charitable giving provides and we must do all we can to enable it to continue.

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Building on an already eventful week, I was very pleased to be able to officially welcome guests on Wednesday (15 June) to the Parliamentary launch of Universities UK and Research Councils UK ‘Big Ideas For The Future’ report, one of the many ‘Universities Week’ celebrations that took place across the UK.

‘Universities Week’ has this year secured the backing of some impressive supporters including entrepreneur Martha Lane-Fox, scientists Robert Winston and Brian Cox and the actor Patrick Stewart. The ‘Big Ideas For The Future’ report forms part of a series of reports, focusing in particular of the excellent research currently taking place in UK higher education and what it will mean for us in twenty years time.

As Co-Chair of the Parliamentary Universities group, I am particularly aware of the excellent research our universities produce which not only impresses in terms of academic value, but also makes an immense contribution to our economy. We all benefit from having strong, innovative universities and a thriving higher education sector and we need to ensure that we continue to invest in the area in order to maintain the UK’s impressive global standing.

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As I’ve mentioned already, earlier this week I challenged Nick Hurd over the Government’s plans regarding charitable giving. Continuing to highlight this important theme, I was delighted to speak at NAVCA in Nottingham on Friday (17 June) in my role as Shadow Minister for Civil Society.

NAVCA provides a national voice for local support and development organisations in England, supporting local charities and community groups and championing voluntary and community action. I believe it is vital that these local groups have an effective means of communication with national government and NAVCA offers such a link, strengthening the action of such groups and ensuring that their needs are heard.

In my speech I highlighted how the Government needs to do more to recognise that some of the cuts have fallen disproportionately on the poorest communities, which therefore need additional support. The full text of my speech can be found on the NAVCA website here.

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It was a pleasure to speak last night at the Cumberland Lodge and Third Sector Research Centre conference. I was very grateful to both Cumberland Lodge and the Third Sector Research Centre for organising such an insightful programme of events.

The event formed part of what have been a truly informative series of discussions and I was very pleased to be able to join in the debate and offer thoughts and my own experience as Shadow Civil Society Minister. Below is my speech in full:

In many ways, Cumberland Lodge, an educational charity which has been organising such conferences of this kind for over sixty years, gives testament to the innovative capacity of the voluntary and charitable sector in this country – something that I come to appreciate more and more as I engage with third sector organisations every day.

And can I, by way of similar means, highlight the excellent work and research of the Third Sector Research Centre. Having such a dedicated and informed resource is of immeasurable benefit to the encouragement of a healthy third sector and robust civil society. I’m very grateful to be able to speak tonight.

 

Tradition of civil society

We can be very proud that there is a great tradition in our country, from a long time before it was even known as ‘civil society’ and before the term ‘third sector’ had anything like a common coinage, of encouraging and supporting civil society groups and organisations.

Whether it is faith groups, voluntary clubs, social enterprises or networks of community organisations – such organisations have for many years helped form part of the fabric of community life in our country. Such work does not just help the organisations concerned, but creates a greater sense of community life, a social fabric and to me as a Labour Shadow Minister, is a fundamental part of living in a better society.

This is testament to the ingenuity and generosity of those involved in voluntary groups, social enterprises and community organisations – rather than any particular government of the day. But as recent debates around the Big Society have shown, the question increasingly is: what can the Government do to help encourage a thriving third sector? I hope to explore some of these important issues tonight.

Big Society; What the Government is doing

Firstly, I want to talk a little about what the Government is doing. Their ambition, to quote Francis Maude, Minister for the Cabinet Office, is clear:

  • ‘We want to decentralise power and put it in the hands of local communities. We want to open up public services to small and medium-sized enterprises, voluntary organisations and mutuals, and support the growth of civil society organisations.’

In many ways, the Big Society is the Government’s attempt to do this. It is a central tenet of the Government’s agenda; a flagship policy and certainly carries with it the supervision of the Prime Minister.

As part of this, we have seen the establishment of a National Citizen Service, a community organisers programme, the encouragement of growth of organisations such as mutuals and employee-led organisations, a Big Society Bank, a greater emphasis on philanthropy and giving and the opening up of public services to competition. The reality is that although the Government coined the term the Big Society, they did not invent the concept. Indeed, many third sector organisations and voluntary and community groups allude to the fact that this is not a new idea.

I want to say from the outset that the truth is that for volunteers and for charitable and voluntary organisations across the country, the Big Society already exists and has done for a long time. They know that, because every day throughout the country they are already delivering the Big Society in our communities.

Nevertheless, it is certainly true that much of the language of the Big Society builds on a rich tradition in this country of community, localism, reciprocity, co-operation and building a better society for all.

The reality on the ground of the Government’s proposals

However, I want to argue tonight that there is something of a dichotomy between the language of the government – in empowering communities and civil society – and the reality of their decisions on the ground.

The facts behind the headlines give light to this discrepancy. ACEVO (the Association of Chief Executives of Voluntary Organisations) has estimated that the reality is that civil society will see its income cut by more than £1 billion this year, and by at least £2.9 billion per year by 2014/15. The Government has allocated some capital funding and £260 million of capital over the next couple of years is certainly very welcome, but this amount is neither going to fill that gap nor come close to. The reality is that there is trepidation across many in the third sector community for the short, medium and long-term futures. An NCVO survey of charity leaders recently showed that 55% of charity chief executives plan to cut staff and 35% plan to cut services by June.

We are left with the question: if the government is really so keen on establishing a thriving third sector, why are so many third sector organisations struggling unable to cope with such drastic spending reductions and the lack of time available to them in order to plan for the future? Only at the end of last week, the Charity Commission have reported that the number of registered charities has fallen by 1,600 this year, and by 700 in March alone. This number has been relatively stable over the last decade, representing approximately 1% of the UK’s registered charities.

Commissioning and the Role of the State

A large part of the Government’s intentions for the third sector were laid out in its Green Paper last year which set the framework for the modernisation of commissioning. This itself takes forward commitments made in the Coalition Agreement to ‘support the creation and expansion of mutuals, cooperatives, charities and social enterprises, and enable these groups to have a much greater involvement in the running of public services.’

Indeed, the Government’s intention is very clear. It wants to shift the commissioning model ‘from consultation alone to increased citizen and social sector participation within policy development and design, commissioning and (co-)delivery’.

This presents opportunities as well as huge challenges for third sector organisations. As Kindle, the umbrella partnership of national charities led by Community Matters, has stated:

‘The Big Society agenda and public spending reviews will require a shift towards more effective and efficient public services. This shift will require a critical examination of what, how and who delivers public services with a greater emphasis on the involvement of citizens and civil society organisations.’

This context presents new funding streams for third sector organisations that can play a key role in identifying local needs and gaps in service provision, as well as an opportunity for them to shape effective services, deliver the services, and evaluate their effectiveness.

However it will also mean that the annual grant funding streams on which many social enterprises and voluntary and community organisations depend will be scaled back. There are also wider challenges for the third section such as the need to build relationships with local authorities and across the public and private sector.

Nevertheless, I have serious concerns that the Government’s actions, by simultaneously seeking huge efficiency savings whilst reorganising the infrastructure for commissioning, will be to the detriment of local service provision and so the Government must be extremely careful.

We had already begun to place more emphasis on social enterprises and mutuals, particularly in the period post the banking crisis, in order to move towards a more responsive mode for the delivery of our public services much earlier. However, the biggest concern is that we know that communities, particularly disadvantaged ones, do need support from government, and they need this from the state at central and local level, and that actually what is key is putting frameworks of support in place for voluntary and community activity and often need to do this in  partnership with others.

Giving & Philanthropy

What the Government has exerted much time and energy on is the promotion of giving and philanthropy. Certainly, I would never seek to dampen any individual who wants to contribute to charitable and voluntary causes and we recognise that, as part of this, the Government has talked enthusiastically about the need to make progress in highlighting the need to expand philanthropy and individual generosity.

However, this cannot, nor should not be the whole story. Again, we have the language of generosity and reciprocity on the one hand and the reality of the situation on the other. The Government’s proposals put forward in its recent Giving White Paper are likely only to make a modest contribution, and will do little to stem the tide of financial crisis that charities are currently facing. Let us take one case as an example. In the first year of this Government, giving from the wealthiest individuals in society has fallen by £818 million to a total of £1.67 billion, representing a 33% fall. Even after the tax incentives in the Budget, the Government is increasing taxes on charities, who will pay £225 million more this year, and £125 million next year. This again gives us some indication that withdrawing the supportive functions of the state not only has a detrimental effect to the sector, but that philanthropic mechanisms in its place are limited in scope.

Big Society Bank

Examination of the proposals for the Government’s Big Society Bank helps develop this theme. Labour recognises that the Government is, with the Big Society Bank, taking on our idea of a social investment bank – but we also know that it is not going to be operational until much later this year and that the money it will dispense will not make up for the huge amount being lost to the sector through reductions in central and local government funding.

Indeed, it is because the Big Society Bank is unlikely to be operational both before the third quarter of 2011 (or later) and as a wholesale bank, that the NCVO have warned, that there will be a gap in time before any funds can reach the frontline. There are also questions that remain unanswered about the Big Society Bank such as a what form will the capital from the major banks take and it is unclear what working rate of return the Government is expecting to provide to the banks. Not surprisingly, Sir Ronal Cohen, who is advising the Cabinet Office on the creation of the Big Society Bank, has said it may even have to change its name as it may not even be a bank. There are therefore not only serious questions about the operational timetable of the Big Society Bank but how it will actually operate for the benefit and enrichment of the third sector. The Chair of the Philanthropy Review Thomas Hughes-Hallett, also the Chief Executive of Marie Curie Cancer Care, has suggested that there may be a danger that the Big Society Bank could potentially produce a system which encourages vulnerable charities to borrow money with little knowledge of the operation of the financial instruments that the bank is using. This is a lingering worry and a significant qualification that the Government must seek to address relatively quickly.

Work Programme

Although we agree with the language behind the establishment of the Work Programme, we believe that the Government could do more to encourage a resilient and thriving third sector. For example, the Government expects 508 sub-contracted voluntary sector organisations to be involved in the delivery of the Work Programme. The Work Programme, which will run for seven years, is likely to be worth between £3bn and £5bn. It is being run on a payment-by-results basis.

However, this has been criticised by the Scottish Council of Voluntary Organisations because allocated funds has only reached the third sector in a limited capacity. As an Opposition, we supports the principle of the Work Programme but there are concerns that the Employment Related Services Association – which represents almost 85 per cent of the organisations awarded prime contracts to run the Work Programme – said such welfare-to-work programmes could actually reduce by up to a third over several years.

Lack of engagement with the equalities agenda

Perhaps most importantly, the Government has been wholly lacking in giving anything like sufficient respect to the fact that communities do not start from a level playing field, and the Government needs to do more to recognise that some of the cuts have fallen disproportionately on the poorest communities, which therefore need additional support.

This is a fundamental point that the Government has simply not addressed yet: there must be the infrastructure in place which recognises that not all communities start from the same level of local capacity.

Indeed, this was a point ably picked up by the Third Sector Research Centre evidence submitted to the Public Administration Committee, in March, which draws in part from the 2008 National Survey of Third Sector Organisations, which said that:

  •  ‘Organisations in receipt of public money are disproportionately likely to be found in more deprived areas and are more likely to serve disadvantaged groups.
  • ‘If public expenditure were reduced proportionately across the board, the risk is that significant proportions of voluntary sector capacity in the most disadvantaged communities would be affected.’

Most importantly, as the evidence submitted also suggests:

  • ‘The core groups of volunteers are heavily concentrated in the most prosperous parts of the country. They are 2.5 times more likely to be found in the most prosperous decile of communities than in the most deprived decile.’

There are concerns that the Government has not framed support structures which address this question. The Government does refer to the establishment of a Transition Fund, delivered by BIG, the non-lottery arm of the Big Lottery Fund, to help struggling charitable and voluntary organisations but, as many from the within the third sector community have said, it does not reach all charities and, in any case, is hugely oversubscribed.

Uncertainty for the Future

Many third sector organisations have been left with a debilitating sense of uncertainty about their own futures and the future of the service they provide in their communities. As Julie Wilkes, chief executive of Skills Third Sector, has recently said:

  • “Charities have been holding their breath on staff cuts in the last quarter, waiting to hear if their contracts with government will be renewed. The next two quarters will be the real test of the state of the sector as they include the end of the financial year.”

But the conditions in which such organisations operate are being choked off; this is not the Big Society that the Government have talked about, but a weaker and more diminished one.

Conclusion:

We have to have confidence as a country to work with the third sector, collaborating as partners where we can, and give support to the vast number of such organisations that contribute a huge amount to our communities across the country. We, too, recognise the need to explore how to make commissioning more community-orientated, and we therefore welcome the debate has begun in government about how to commission services with greater involvement from the third sector as well as local communities.

The third sector has shown time and time again its incredible ability to innovate and take on new challenges to achieve much more than individuals alone or well-intentioned local authorities or governments.

As an Opposition, we want to see strong, well-resourced public services that are able to partner with the third sector. We also see a key role for social enterprises and mutuals in improving service delivery, and a key role for community organisers in helping communities to articulate their needs and shape services.

Communities require different levels of resources and input, and if social enterprises, voluntary and community organisations are really to be empowered to shape and deliver the services that they want, then I think we need a framework and a timetable in place to deliver that that is simply not there at the moment. It is my contention that the Government is lacking a properly worked out plan to implement the Big Society across government. So that is the challenge to the Government on the third sector.

And if we as an Opposition seek are to achieve a fairer, more just and more progressive society, then we must trust, support and harness its talents

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Visit to Toynbee Hall

I was delighted to visit Toynbee Hall recently in my capacity as Shadow Civil Society Minister. Toynbee Hall is a fantastic social facility and organisation in Spitalfields within the borough of Tower Hamlets in East London, and I was there to learn more about their programmes for training and social development

As Shadow Civil Society Minister I meet some excellent organisations quite regularly but I was particularly inspired by those I met at Toynbee Hall. I was met and shown around by Graham Fisher, Chief Executive, and Alice Wallace, Third Sector Developer Manager, who talked me through the history and development of the organisation. It was really interesting and the enthusiasm of the staff came through.

Toynbee Hall has also had some major success in generating an impressive list of Ambassadors for the organisation – including figures such as Dr John Sentamu, Archbishop of York, John Snow from Channel 4 News and the journalist and author Polly Toynbee.

I saw a wide range of services whilst I was there including a day centre and lunch club. There was an excellent training room as well as an advice centre which offered legal and financial advice.

I was also particularly keen to learn more about the Sheltered Housing Scheme, a vital service which I could see very clearly that many people were reliant on. There was also a thriving arts centre, cafe and reception/event rooms.

What I took most from the visit was the excellent way in which Toynbee Hall brings together advice, training and legal services as well as wonderful cultural activities across the community. The services appeared to be valued by local people very much indeed and it was fantastic to celebrate with staff and volunteers a range of local cultures.

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It was a pleasure to speak this afternoon at the launch of the All Party Parliamentary Group (APPG) on Employee Ownership’s report on ’employee ownership in the public sector’. I was very grateful to Jesse Norman (Chair) and all the members of the APPG for the opportunity to speak at the event which provides a valuable voice for co-owned businesses.

Even the most dispassionate of political observers can see that the debate over employee ownership and alternative economic models for future of public service delivery has aroused the intellectual curiosity of both the left and the right. Below is my speech at the launch of the APPG on Employee Ownership’s report in full:

For Labour progressives, the arguments for employee ownership have always been robust: employees feel that they have a greater stake and ability to affect change within their organisation for the benefit of users and the organisation itself. Indeed, collective ownership has deep roots within the Labour tradition.

In some ways the debate has been muddied by the apparent interchangeability of the terms involved. As the report makes the point, enquirers to the Mutuals Information Service, for instance, described their desired business model as a mutual; an employee owned business; an employee mutual; employee-led; co-operative; social enterprise; or some combination of all of these.

Labour in government did much to encourage new economic models in services and delivery: at the end of 2010, for example, there were approximately 62,000 social enterprises in the UK contributing at least £24bn to the economy.

For many on the progressive and Labour side of the debate, we are pleased that the Government is now considering the benefits of employee ownership and it is excellent to see so many Members from all parties, new from the General Election and those already here in Parliament, becoming involved and really exploring the possibilities of employee ownership. I have for a long time believed that the public is supportive of companies where employee ownership takes place as it facilitates better engagement, co-operation amongst its staff and greater trust with its customers.

The report offers an excellent overview of some of the main issues involved. It is right to highlight the work of organisations such as Greenwich Leisure Ltd, Central Surrey Health and City Health Care Partnership in Hull – who have often been at the forefront of this debate – and in some ways ahead of the politicians.

Labour’s Argument

Francis and others have mischievously suggested that our parties are in danger of ‘violent agreement’ about the merits of employee-owned models. I think this may be exaggerating the point somewhat, but the report is quite right to chart the evolutionary thinking between the parties and we welcome this.

I believe it is important to outline three brief concerns that Labour has about the Government’s foray into this area.

Firstly, as someone who speaks to organisations in the voluntary, social enterprise and charitable sector with long histories in service provision, there are lingering concerns that the Government’s ambitions for employee-owned companies is actually facilitating something of a stepping stone process to privatisation. As the report itself recognises, there is evidence of concerns that employee-led mutuals will become more conventional private sector providers competing in the open market in time.

Secondly, Labour is very clear about the need for proper safeguards to protect employment rights, pensions and pay of employees as absolutely fundamental. In the event of a paradigmatic shift in the structure of the company – through IPO processes or acquisition, for example – these hard-won and important rights must be protected. It is no surprise that many trade unions and representative organisations have expressed concerns about this being a cover for spending cuts and if the Government is serious about this, it must seek to address these concerns.

There is much at stake if not. Should employees’ rights not be protected, or anything otherwise be the case, the danger is that people will become disillusioned by the employee-ownership model and this risks undermining the case for it and the benefits of employee-ownership becomes inevitably tied up in a bruising debate about huge spending cuts.

Thirdly, again as the report rightly acknowledges, there are basic practical implications that need to be thought through – in terms of adherence to tax legislation, for example – so that those wishing to pursue an employee-ownership model, the effects of doing so are properly considered and understood.

I don’t have political disagreement about this but there are a number of concerns that need to be fully worked through for its success in the future.

As the debate progresses, it will be important for proponents of employee-ownership to help encourage a shift from the praising of specific examples, somewhat ad hoc in nature, to envisaging of a serious and viable economic model capable that is reachable by many organisations. This is not merely the narcissism of small differences but rather a serious reflection that, if these issues are not taken on board, the Government risks undermining the employee ownership model at the outset.

This report serves a thoughtful step towards that aim and once again I am very grateful for your invitation today.

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There are some days in Parliament when it’s brought home in dramatic fashion to you what an incredible institution it is. Last Wednesday really was one of them.

After catching an early train to London soon after opening the fantastic Fashion Show at New College the night before, the scene was well and truly set for an historic Parliamentary occasion. Barack Obama was due to speak in Parliament as part of a wider state visit to the United Kingdom.

Westminster Hall, the scene of so many important events in our national evolution, was packed to the rafters. The oldest part building on the Parliamentary Estate, shaped and ingrained by some 900 years of historical events, is truly magnificent and steeped with medieval character.

Current and former political leaders, MPs from the House of Commons, Members of the Lords as well as a number of foreign dignitaries were all in attendance to listen to President Obama. The level of security everywhere was quite staggering. The chance to address both Houses of Parliament is an extremely rare honour for a foreign leader – one only afforded to a very select few people with the Pope having been the last to do so. Obama, having made his way over from Downing Street just a short distance away, opened with a joke which set the tone well.

“I have known few greater honours than the opportunity to address the mother of parliaments at Westminster Hall,” the president said. “I am told that the last three speakers here have been the pope, Her Majesty the Queen and Nelson Mandela, which is either a very high bar or the beginning of a very funny joke.”

The President touched upon a number of important themes during his speech: the importance of a close relationship between our two countries – a point made with added weight given our military personnel serving overseas. He also talked about the shared beliefs in democracy and common values as well as the broader relationships between Prime Ministers and Presidents throughout British and American history.

I felt it was an important speech that was received well by members of our Parliament and certainly believed that it would be remembered for a long time. The House of Commons Speaker, John Bercow, also made some opening remarks that were both warm and captured the sense of occasion very well I thought.

The remarkable journey of the life and career of the President was brought home to Parliamentarians when he spoke of the pride he felt about how the grandson of a Kenyan cook could address the Houses of Parliament as President. This is even more remarkable when you contemplate the occasionally fractured relationship of our two countries. His remarks received a warm applause from many assembled listening to him, including a number of my Labour colleagues who managed to greet him and shake hands at the end.

It never ceases to be my great pride representing the City of Durham in our House of Commons. Days like this reaffirm just what a privilege it really is to be able to do so. After the speech had ended, it was back on the train, casework and coffee in hand, and starting to get ready for the dozen or so meetings in Durham that night and the following day. A truly remarkable day.

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