26th Sep, 2020

'Upfront and honest' council replies as charities raise alarm at rent increases

Ross Crawford 22nd Oct, 2019 Updated: 23rd Oct, 2019

PLANS by the borough council’s controlling Conservative group to remove vital subsidies from key Redditch charities have been met with outrage and horror.

Many say they will be unable to survive if the measure goes through, removing an essential safety net for some of the town’s most vulnerable people.

Up to nine key Redditch charities are likely to be affected including Where Next? Bromsgrove and Redditch Network (BARN), Batchley Support Group, Reach CIC in Winyates, Home Start, the Oasis shops, Your Ideas and Matchborough Boxing Club.

“These are places that are run for the benefit of the people of Redditch and these should be the last organisations penalised in this way,” said Gary Roskill chief executive of BARN.

“If this goes through it will decimate the voluntary sector and have massive ramifications which will be felt right down the years.”

Under plans which go before the Borough Council’s all-powerful Executive Committee next Tuesday, October 29, it is proposed that the authority removes its subsidies on rents to voluntary and community sector (VCS) organisations by March, 2022.

That subsidy currently stands at 70 per cent, and costs the council £82,000 a year.

The council was recently issued with a Section 24 notice by its auditors which said it was running out of money and needed to find £1.2million in savings in the next financial year.

The alarm was raised after the council failed to increase council tax by the amount permitted and failed to increase crematorium charges.

In addition councillors gave themselves a £60,000 increase in allowances, despite consistently voting against it when in opposition, and cut the amount of concessionary grants available for good causes.

Tuesday’s report to council says: “In the current financial climate and with the amount of savings the Council needs to make now and in the future, it is suggested that the amount of Council subsidy is no longer sustainable.

“It is therefore recommended that this scheme be phased out and the VCS groups who currently utilise the scheme be placed onto transitional arrangements until the scheme is completely withdrawn in 2022.”

The report also states that all the charities had been written to informing them of the plans, however the Redditch Standard has been unable to find any organisation that received such a letter.

Mr Roskill added: “Charities function on a tiny budget and to absorb a 70 per increase in their rent would be impossible.

“I understand the council is short of money, but these charities save the council loads of money and who is going to pick up the pieces once they’re gone?

“It’s going to cost a fortune, far more that their £82,000.”

Under the proposals all VCS Group charities would be moved to a 40 per cent level of rent reduction for the first year of the transition process and then for year 2 would receive a 20 per cent reduction in their rent.

By year 3, all would be paying full market rent on their property ‘should they chose to continue to rent their property.’

The council adds that there are a number of commercial organisations who requesting properties, particularly in the district centres.

The Executive Committee meeting is at the Town Hall and starts at 6.30pm and campaigners are already planning a protest outside.

Councillor David Thain, (Con, West), whose Portfolio covers Corporate Management, said: “In August we were upfront and honest about the difficult decisions which we would have to make.

“The Council is facing a very challenging financial position and we must consider all of our costs. We have had some of the lowest fees and charges in the County and offer subsidies which see us making losses. In this instance it is £82,000 a year.

“These moves, if approved, are by no means a quick win as it will cost the Council £70,000 for the two years as we offer transitional support to the organisations involved, who can, after that time, remain at the premises but at full market rent.

“We continue to offer support to the VCS sector. The organisations may get reduced business rates and we are about to launch our Redditch Community Lottery which will benefit good causes – and our residents.”

Council Leader Matt Dormer, (Con, West) added: “While these recommendations have to go through the decision making process including , Executive and full Council, we do have to be realistic and operate more commercially if we are to make this Council sustainable and avoid cutting front line services.”

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