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Cardiff Council Cyngor Caerdydd Cabinet Meeting

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Cardiff Council Cyngor Caerdydd Cabinet Meeting CARDIFF COUNCIL CYNGOR CAERDYDD CABINET MEETING: 21 FEBRUARY 2013 CORPORATE DECISION MAKING FRAMEWORK FOR GRANTS 2013/14 REPORT OF CORPORATE CHIEF OFFICER (COMMUNITIES) AGENDA ITEM: 7 PORTFOLIO: FINANCE, BUSINESS & LOCAL ECONOMY Reason for this Report 1. To agree grant proposals for 2013/14 as an integral part of the Council’s budget strategy. Background 2. Cabinet has previously agreed a decision making timetable for grants in line with the budget strategy under the auspices of the Voluntary Sector Compact. 3. This report provides an overview of Service Area grant proposals for 2013/14 (Appendix A) and seeks agreement of the Cabinet to award Council Grants totalling £2.7 million, subject to Council approval of the 2013/14 budget. Issues 4. The voluntary sector is seen as a significant partner in delivering Council functions and a major player in contributing to local community life. This report has been introduced to standardise the award of grants to third sector organisations across all Council Service Areas. Grant Proposals 2013/14 5. Grant proposals for 2013/14 are summarised in the attached overview (Appendix A) and are subject to the approval of the Council budget for 2013/14. The following should be noted: (a) The Council is required to make savings of over £22 million in 2013/14 with non-protected services being cut by 15.3%. Because of the high level of savings required, the Council is unable to absorb this within its own costs and it has been necessary to pass Page 1 of 5 on this requirement to recipients of grant funding. However, in the majority of cases this has not exceeded a 10% reduction on the 12/13 award level. (b) Where Service Areas have proposed to disinvest in a particular project, these predominantly relate to where a period of time- limited funding has ceased. (c) Adult Services is currently consulting on the future of carers’ support and services. Therefore existing Carers’ Grant recipients have been informed of the proposal to initially award six months funding in 2013/14 based on their 2012/13 award levels. Recipients will be informed of funding decisions beyond September 2013 following the conclusion of that consultation exercise in March 2013. The overall budget for the 2013/14 financial year has been subject to the 10% cut and officers will work with organisations to alleviate the effects of any proposed reductions. (d) Risk and Equality Impact Assessments have formed part of the overall grant assessment. These procedures ensure that Service Areas have not viewed grants as a soft option from which to find savings and recognise the additional resources and added value the voluntary sector can provide. (e) A number of previously centrally managed grants have been transferred to relevant Service Areas to ensure closer accountability and responsibility for grants that continue meet their specific strategic priorities. In-principle Notifications, Formal Offers and Terms & Conditions 6. Notifications were sent to organisations advising of in-principle proposals (subject to approval of this report and the Council budget) on 1 st February 2013. These notifications are beneficial from a business planning perspective, especially so given the well documented public funding concerns, though for legal reasons they explain that organisations should not rely on the proposal to make commitments at that stage. Formal offer letters will be circulated once the Council budget has been set and, where applicable, on the determination of a grant agreement. Review of Grant Arrangements 7. Due to the level and complexity of the various programmes across the Council, there is a need to review all grant arrangements to ensure the Council maximises the value of its relationship with the voluntary sector, particularly in view of the financial challenges faced and the current economic climate. 8. Therefore during 2013/14 the Council will undertake an extensive review of its current funding arrangements. This review will seek to align grant funding programmes and ensure efficiencies are obtained through the Page 2 of 5 financial support offered, especially to organisations that receive funding from a number of Service Areas. It will also explore other innovative ways to support projects, including what support in kind could be offered as a potential alternative to grant funding. GrantNet 9. The Council still maintains its commitment, in partnership with the Cardiff Third Sector Council (formerly Voluntary Action Cardiff), to providing the GrantNet service for a further year. Established in 2004 this service provides access, via the Council’s website, to information on over 4,000 grants, loans and other incentives. Reasons for Recommendations 10. To agree grant proposals in line with commitments made to the local voluntary sector. Legal Implications 11. The Council is empowered under a number of statutory provisions to make payments by way of grant for certain identified purposes. The proposed grants referred to in the Appendices to this report are for various purposes and because they are not stated with sufficient certainty it is not possible to advise whether there are specific statutory provisions for the payment of the grants as proposed. The Council has a general power under Section 2(1) of the Local Government Act 2000 ("the Act") to do anything which it considers is likely to achieve any one or more of the following objects-(a) the promotion or improvement of the economic well-being of their area; (b) the promotion or improvement of the social well-being of their area; and (c) the promotion or improvement of the environmental well-being of their area. This section would authorise payments by way of grant where the purpose to be achieved falls within the provisions of that section. This power must be exercised in accordance with the terms of that section particularly having regard to the community strategy which the Council is required to prepare in accordance with the Act. The strategy must be taken into account in coming to a view upon the recommendations made in this report. Further the Cabinet recommending agreement to the recommendation in this report and Council as decision maker must be satisfied that the proposals will achieve one or more of the objectives set out in section 2 above. However where a specific statutory provision empowers the Council to make such payments then those provisions will prevail and any conditions or limitations as may attach to them. Officers responsible for dealing with individual grant applications should therefore consider if reliance is being placed on Section 2 of the Act or on a specific statutory provision, and, if so, what limitations attach. 12. Each application for funding must be considered on its merits. Consideration must be given to such applications in the context of the statutory provisions and ensure that the monies sought will be applied to a proper purpose and will deliver the Council's duty of best value for Page 3 of 5 instance. An appropriate test may be to consider whether the expenditure is commensurate with the benefits identified for the area. Care must be taken where there is any question as to the viability of the relevant organisation that the monies are not be applied in propping it up for example, but will be applied to deliver the objectives identified as the reason for the provision of funding. Further payments must be conditioned to ensure that the monies are properly used and are only applied for purposes which the Council can lawfully undertake. 13. In respect of individual grant recipients it should be considered whether the award of the grant will affect how the body will be classified in terms of the legislation relating to "local authority companies". If such is the case then further legal and financial advice should be sought. 14. Further in so far as Service Level Agreements are required as a condition of the payment of funding, if they operate so as to be in the nature of a service contract (i.e. a contract in writing for consideration (whatever the nature of the consideration) under which a contracting authority engages a person to provide services) then the process must accord with the Council's Contract Standing Orders and Procurement Rules and if the relevant thresholds are exceeded will also be subject to compliance with the legislation relating to the award of Public Service Contracts. 15. Any provision of grant, loans or other subsidies from public funds may give rise to State Aid issues. Unlawful State Aid is defined as ‘any aid granted by a Member State or through State resources in any form whatsoever which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods…in so far as it affects trade between Member States...’ Aid that does not meet the definition or is covered by a block exemption i.e. previously approved categories of aid (subject to satisfying conditions) or because it is de minimis i.e. currently under €200,000 over a 3 year fiscal period (for all aid to a particular organisation from public funds) is generally regarded as lawful aid. Officers responsible for dealing with individual grant applications should therefore consider whether any grants raise any state aid issues. Further legal advice should be sought if there are any issues. 16. The proposals in this report cannot be given effect to unless the proposals fall within the Budgetary Framework for 2013/14. These proposals must be the subject of a risk and equality impact assessment as required. Financial
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