Voluntary and community organisations using local and national government funding to deliver services need to brace themselves for a big reduction in funding, particularly from 2011. £1.5 million of Supporting People funding has fallen out already (approximately a third of this relating to homelessness services) and difficult decisions lie ahead for commissioners as other external funding regimes come to an end or are reduced, and any ‘mainstreaming' (i.e. absorbing within core Council or PCT budgets) implications for these externally-funded projects are further exacerbated by falling internal budgets.

The Council has already set out the difficulty of its position at its budget consultation meetings with the voluntary and community sector took place on 27 October and 11 November. Although the Council can borrow to address a shortfall in its capital budget, its revenue budget must balance. The Council is currently facing a £10m revenue deficit for 2010/11, rising to £24m in 2011/12 and £38m in 2012/13. The savings proposed would eliminate the 2010/11 deficit, and reduce the 2011/12 and 2012/13 deficits to £8m and £20m, if all options are accepted by Elected Members, and it is the task of the ABC programme (which stands for a better Council for a bolder Coventry) to identify means of delivering these further savings, particularly by looking at how services are delivered and whether better outcomes can be achieved at lower cost. The biggest savings proposed for 2010/11 include:

• £270,000 through implementing the approved policy on community centres gap funding
• £500,000 through meeting Single Status costs through the Dedicated Schools Grant
• £500,000 through reviewing the service with CV One and looking for economies of scale
• £350,000 through reviewing street cleansing and grounds maintenance
• £540,000 through continuing to personalise care and giving greater choice by putting more money in domicilary and home-based care rather than more expensive institutional care
• £1,100,000 through vacancies and staff turnover
• £300,000 (leading to £600,000 p.a.) through removing 10 senior management posts
• £250,000 through reviewing administration generally
• £1,500,000 by freezing standard supplies and services budgets
• £500,000 through reviewing the policy on debt repayment
• £500,000 through a review of procurement

Service providers in particular need to continue to prepare for greater personalisation of care and the greater use of individual budgets for people to buy their care with, given the greater emphasis this is now being given.

Grant-funded organisations will, as with last year, be expected to absorb a 3% reduction.  Although this will come with an impact, this approach is still preferable to specific services being taken out completely. Organisations who can demonstrate a strong business case may be exempted from the reduction, as was the case last year with advice services facing increased demand for their services due to the recession. There is a further £24m deficit on capital expenditure over the next 2-3 years which will be partially addressed through borrowing.

Reductions in expenditure from 2011/12 onwards could be far deeper than those proposed for 2010/11. To download the report including the proposed savings, click here

http://cmis.coventry.gov.uk/CMISWebPublic/Binary.ashx?Document=14682