Birmingham City Council
Decision to axe £1.4 million funding
for 13 voluntary organisations unlawful &
transgressed equality legislation
Nicole Catenazzi, Compact and Public Law Advocate from the National Council for Voluntary Organisations wrote to Birmingham City Council questioning the legality of cuts affecting 13 voluntary organisations expressing "serious concerns about the decision-making process and the legality of leaving a substantial gap in service". Her letter said "The effect of having no funding from the council for a period of five months or more will be that most of the affected organisations will have to close permanently. It appears that there was no consultation carried out in advance of this decision, nor were any impact assessments performed".
The council had planned to end grants and service-level agreements to members of Birmingham Advice Network at the end of March 2011 and establish a new commissioning process in July at the earliest.
Jack Dromey, Labour MP for Birmingham Erdington, told a Westminster Hall debate in February 2011: "It would appear that the cuts are not just cruel and callous; they may be unlawful as well. Many of us will give evidence in any proceedings that are held because we know from our experience that there was no proper consultation in advance, and that no serious impact assessments were conducted. The council made the decisions just before Christmas, and it has gone hell for leather to implement the next stages without proper consultation or impact assessments."
"There will be huge issues around support for the most vulnerable in our society, but there has been no dialogue at all with the city council on that," said Khalid Mahmood, the Labour MP for Birmingham Perry Barr at the debate.
Business minister Edward Davey would not respond to questions on whether the cuts were compliant with the Compact, the public and voluntary sector fair play agreement.
A statement by the 13 organisations said in February 2011 "The council has not revealed the size of the cut to the overall budget, but there are indications that it may be as much as 50 per cent."
Anne Limbert, head of operations at Birmingham Citizens Advice Bureau, which faces a £600,000 cut, said it had planned to close four of five bureaux in the city today, with the loss of 45 jobs, but this had been put on hold pending the outcome of emergency talks with the council.
A spokesman for Birmingham City Council said in February 2011 "We've always made it clear to agencies that funding was not guaranteed beyond any single year, up to a maximum of three years. It was never our intention for agencies to become dependent on this source of funding or that it form their sole source of income. The council's contracts with the current providers ceased in March 2010 and were rolled over until 31 December. From then, a funded notice period of 90 days was in place to provide some protection for the providers, and CAB was paid £150,000 notice payment to enable it to continue to offer services in the interim period. Individual meetings are being held with the service providers, including the CAB, to engage them with the recommissioning process."
The 13 organisations affected are:
- Afro-Caribbean Millennium Centre
- Age Concern Birmingham
- Age Concern Perry Barr
- Azad Kashmir Welfare Association
- Bangladesh Welfare Association
- Birmingham Asian Resource Centre
- Birmingham CAB
- Birmingham Settlement
- Birmingham Tribunal Unit
- Birmingham TUC Centre for the Unemployed
- Chinese Community Centre - Birmingham
- St James Community Support & Advice Centre
- Shaheed Udham Singh Welfare Trust
On 1 April 2011 the Birmingham Post reported:
"A decision to axe a £1.4 million funding package for 13 voluntary organisations", including the Citizens Advice Bureau, was unlawful, a High Court Judge has ruled.
Mr Justice Blake said a Birmingham City Council decision to stop giving money to groups such as the Citizens Advice Bureau was "clearly defective” and that councillors appeared not to understand their obligations under the Race Relations Act, Sex Discrimination Act and Disability Discrimination Act.
Council leaders failed to take proper account of the impact that withdrawing grants would have on disabled and vulnerable people, the judge added.
No consultation was carried out with people who would suffer because of the funding cuts; neither did the cabinet consider other ways of helping the organisations to identify alternative funding.
The judge said that the Equality Impact Needs Assessment, council officers drew up was defective and did not address the real issues.
Mr Justice Blake allowed a judicial review by users of the three of the affected organisations – the Birmingham Tribunal Unit, the Chinese Community Centre and St James’s Advice Centre – and ordered the council to continue to pay them a total of £25,000 a month until the cabinet can reconsider the matter and reach a lawful decision based on effective consultation.
This means that the three bodies will continue to receive council cash at least until June.
The judge was critical of the cabinet’s decision to cut funding from this March, when a commissioning process to approve a new grant regime would not be completed until July, leaving a four-month gap when the 13 groups would receive no money at all from the council.”
This is going to become a familiar story.
Tax Research UK, Richard Murphy on Tax & Economics:
For Information & Advice on this subject please visit the following website: -
You can find the NCVO contact details here: -
Cumbria CVS might also be able to help you with any queries you might have on the above subject and their service is free: -
ACT Cumbria also gives free information and advice to rural community groups and organisations: -
If you need any advice specific to equality legislation, please contact Cumbria Equality Resource Centre, The Old Stables, Redhills, Cumbria, CA11 0DT, 01768 895242, firstname.lastname@example.org
Follow up to the above story released by Third Sector on 4 April 2011: -
"Birmingham City Council's decision to cut more than £1m of funding from 13 advice charities in the city was unlawful, but only the three that challenged the decision should have their funding reinstated, a High Court judge has ruled.
Mr Justice Blake ruled last week that the three charities – the Birmingham Tribunal Unit, the Chinese Community Centre Birmingham and St James Community Support & Advice Centre, Birmingham – should have their funding reinstated.
Five service users had asked the court for a judicial review of the council's decisions on the grounds that it had not carried out either an equalities assessment or a proper consultation.
The decision leaves many of the other ten charities facing the threat of closure, including the country's largest Citizens Advice bureau.
The council announced in December that it would stop the funding with immediate effect and would offer new advice funding only in August. Birmingham Citizens Advice Bureau managed to get its £600,000 core funding extended until February, but is relying on its reserves to keep it going.
Alastair Wallace, a partner at Public Law, the firm that represented the service users, said the decision not to order the reinstatement of the funding of the other 10 organisations appeared to have been made largely because none of them made representations in the case. But this "did not recognise the reality on the ground", he said, which was that the charities could not afford to take part in the case.
For the case to go ahead, he said, service users had needed legal aid funding, which the Legal Services Commission was unlikely to grant to service users of 13 different charities. The charities themselves could not have afforded to bring an action.
"These other organisations are in a difficult position and I've real sympathy for them," he said. "If I was them, I would write to Birmingham City Council and ask it to reconsider its decision."
"Having made an unlawful decision, the council may do the prudent thing and fund all those charities until its new funding appears in August."
A spokeswoman for Birmingham CAB, which has said it will have to close at the end of this month unless it finds more funding, said it was unclear what options were open to the bureau following the review, and that it was currently considering its options.
Peter Lowen, acting chairman of the Birmingham Advice Network, which represents advice charities in the city, said several organisations were likely to have to close. "Most don't have the time to explore other options," he said. He added that organisations still had not heard from Birmingham City Council about whether it would now provide funding or continue to fight the judgement.
A spokeswoman for Birmingham City Council said: "We are disappointed by the court's judgement. The council is considering its position, including a potential appeal against the judgement.""
Link to updated Third Sector Article: -