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Jack Dromey (Birmingham, Erdington) (Lab)
Thank you, Mr Sheridan, it is a pleasure to serve under your chairmanship.
This is a debate of immense importance for the people of Birmingham. The Birmingham citizens advice bureau is the oldest and largest in the country, dating back to 1939. Progressively, the Birmingham CAB opened five offices in Birmingham to meet great and growing demand. Last year, the Birmingham CAB provided advice and support to 56,000 people. For those who find it hard to access mainstream services, it also provides a comprehensive web of outreach services in, for example, GP practices, children’s centres, hospitals, dementia advice projects and Macmillan Cancer Support.
The Birmingham CAB employs 100 full-time staff, who work with a dedicated army of 166 volunteers, including the excellent Paul Ballantyne who is here today and who is the chair of the trustees, and the excellent John Orchard, a volunteer for the CAB. Both have both devoted many years’ work to the CAB in support of the most vulnerable people in Birmingham. And vulnerable they certainly are; in Kingstanding, in my constituency, we have a CAB in one of the poorest and most deprived wards in Britain—much cherished by the people who live in the ward.
Birmingham has been hard hit. The west midlands has the highest unemployment anywhere in Britain. Just when the people of Birmingham need somewhere to go for support and advice, the generalist advice services of all five citizens advice bureaux will close. Why? On the one hand, it is a combination of the callous cuts being made by the Government to local government services in Birmingham, where £170 million will come out of the budget next year alone; and on the other hand, the cruel incompetence of the council.
Steve McCabe (Birmingham, Selly Oak) (Lab)
I do not know if my hon. Friend saw the Prime Minister’s very helpful comment in The Sunday Telegraph, when he said that councils should look to reduce their chief executives’ salaries before they cut citizens advice bureaux. Given that the chief executive of Birmingham is one of the highest-paid in the country, should he and some of his senior officers not take a cut before the CAB?
Jack Dromey
My hon. Friend makes a powerful point. The last thing that should be cut is advice to the people of Britain from citizens advice bureaux. If there are to be reductions, they should start at the top in Birmingham city council.
The CAB had been planning for some council cuts for some time, going back to March 2010, but suddenly, out of the blue, the bureaux were told in December just before Christmas that they would lose all their funding from March 2011. The CAB then made repeated approaches to the council to try to find a way forward. What have they been told? “Sorry, you will have to close by March, but you can reapply for a fresh funding stream in August this year.” That means that the CAB’s generalist advice services will close down for five months, with no certainty whatever that there will be support afterwards.
John Hemming (Birmingham, Yardley) (LD)
Does the hon. Gentleman not accept that the city council is in fact offering interim funding to maintain the service, and that the CAB had not actually made proposals for any savings whatever?
Richard Burden (Birmingham, Northfield) (Lab)
This is an intervention on my hon. Friend, but before I start it I think the answer to the question asked by the hon. Member for Birmingham, Yardley is no.
Would my hon. Friend comment on the fact that in the other place, Baroness Wilcox said:
“Central Government has not been notified of the closure of any citizens advice bureaux since the spending review settlement 2010. The Government are aware that local authorities that fund citizens advice bureaux are facing tough decisions but do not expect them when making those decisions to pass on disproportionate cuts to other service providers, especially in the voluntary sector.”—[Official Report, House of Lords, 26 January 2011; Vol. 724, c. WA166.]
Would my hon. Friend join me in inviting the Minister, when he responds, to tell us what it means, other than just words, if the Government let happen what looks like happening in Birmingham?
Jack Dromey
My hon. Friend is absolutely right. It is proof positive, once again, that the Government are simply out of contact with the consequences of their actions. What is happening in Birmingham is clear beyond any doubt. The question that we will be asking today is what Ministers intend to do about it.
On the point about the council, the hon. Member for Birmingham, Yardley asked whether the CAB had explored alternatives. It has explored alternatives repeatedly. I have seen the correspondence going backwards and forwards. The CAB has tried to find a way forward, but what has it been met with? Among other things, abuse from the cabinet member concerned, Councillor Ayoub Khan. Just when the CAB was looking for a co-operative approach to try to find a way forward, including making economies consistent with protecting the service to the community, it ran up against a brick wall.
John Hemming
Earlier, the hon. Gentleman claimed that there was no proposal for any funding from April onwards. In fact, there is a proposal to make interim funding available. That, to be fair, is something that I have discussed with the CAB.
Jack Dromey
There will be a crucial meeting on Monday next week. As things stand, the CAB will have no alternative but to close down its generalist advice services—no alternative. If, as a consequence of today, the Government say, standing by previous statements, that they mean what they say and that CAB should not close, and if the council sees sense, not only will the CAB celebrate, so too will the people of Birmingham.
If there is no change, let us bring home what the consequences will be for the people of Birmingham. All Members who represent Birmingham can give examples—the kinds of problems that my hon. Friend the Member for Coventry South (Mr Cunningham) sees as well—but I shall give the House three. First, a quote:
“I didn’t know what sort of help to get regarding family difficulty with breach of custody agreement. I was terrified that I may lose my son to a hostel and wouldn’t know who to go to about my rights as a father if it wasn’t for the CAB.”
That difficult family problem was successfully resolved.
Secondly, a client of the CAB, disabled and living alone in an empty flat on a low income with no furniture, had no idea about the support available—social tariffs for utilities, community care grant or budgeting loans for furniture. Thanks to the CAB, that disabled woman now lives in comfort and is properly supported. Thirdly, there is the case of a client with cancer, who without the help of the CAB would not have been able to challenge successfully a decision not to award her benefits.
The consequences for people like them, and for the people of Birmingham more generally, will be severe indeed. Where will they turn at their time of need, and just at a time when demand is increasing?
Jim Shannon (Strangford) (DUP)
The issue for a great many of us as elected representatives and as MPs is that we recognise the good work that CAB do, but we also recognise that with the changes the coalition Government are putting forward on benefits, demand for CAB services will increase and concerns will increase. Homelessness, loss of benefits and loss of income will be critical issues over the next four to five years.
Jack Dromey
The hon. Gentleman makes a very powerful point indeed. I suspect that all Members of Parliament, let alone advice agencies, are seeing the same trend of growing demand for support from us: advice on housing, advice on homelessness, advice on benefits and advice on debt. A whole range of issues is coming to us because there is growing demand when the economy is in difficulties and at the same time the Government are cutting back vital services to the people of Britain and Northern Ireland.
Yvonne Fovargue (Makerfield) (Lab)
Does my hon. Friend agree that CAB and other advice agencies are facing a double whammy because of the cuts? The closure of the financial inclusion fund will leave 100,000 people who were served last year with nowhere to turn in the future, and more than 500 skilled and trained advice workers are currently serving their notice.
Jack Dromey
My hon. Friend is absolutely right. She brings to this debate the wisdom and experience of her many years in the CAB. Her contribution is welcome, and she is right to bring home once again the consequences of what the Government are doing.
On the folly of the cuts, interesting independent academic research has demonstrated that every £1 invested in advice yields a return of up to £10 because early intervention produces the best results. What will happen—it is as simple as this—is that the CAB and other advice services will be run down and closed, and there will be greater risk of debt, homelessness, poverty, mental health problems and relationship breakdown simply because tried and tested services upon which people depend at a time of need have gone.
Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)
Does my hon. Friend, as a fellow Birmingham MP, share my experience? The two agencies that I rely on most heavily when constituents come to my advice surgeries are the CAB and the Immigration Advisory Service. The CAB is a source of reliable, independent advice, and there is no alternative. If we lose it, our people will lose.
Jack Dromey
My hon. Friend speaks from her great experience in Birmingham, Edgbaston. She is absolutely right: these services, including the one for immigration, are vital. The question then arises—Ministers will have to answer it—of where people will go if the fabric of our advice services is torn apart. As I shall say in a moment, it is not just the CAB; a total of 13 services will close in Birmingham.
John Hemming
I agree with the hon. Gentleman that the CAB is a vital service, but does he agree that it should not take an all-or-nothing approach but be willing to compromise with the city council and aim to maintain a service at a lower cost?
Jack Dromey
The hon. Gentleman is, to be frank, wrong. The CAB has made it consistently clear that it is prepared to do precisely that, but dialogue with Birmingham city council has proved to be a dialogue with the deaf. If he will speak out today and call on Birmingham city council, and join the Labour MPs of Birmingham in hoping that good sense will break out next Monday, that would be very welcome indeed.
John Hemming
I have been working with the city council on funding proposals to maintain a substantial part of the CAB service, so that has been happening.
Mr Khalid Mahmood (Birmingham, Perry Barr) (Lab)
Will my hon. Friend give way?
Mr Mahmood
The hon. Member for Birmingham, Yardley (John Hemming) is not dealing with the real issue. I have two CAB in my area—one in my constituency and one just outside—which serve some of the most deprived people in the area. Those people have real issues in respect of health, housing and mental health. An organisation called COPE: Black Mental Health Foundation, which provides advice on mental health issues, will close in the next two months because the city council is not providing any support. The Asian Resource Centre is also closing. As my hon. Friend the Member for Birmingham, Erdington (Jack Dromey) says, 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.
Jack Dromey
My hon. Friend is, of course, right; it is not just the CAB. Some of the 13 organisations that are threatened are the Afro-Caribbean Millennium Centre, Age Concern in Birmingham and Perry Barr, the Birmingham Asian Resource Centre, the TUC Centre for the Unemployed and the Chinese Community Centre. A whole range of advice services catering for the needs of the various communities of Birmingham are all facing closure. In total, between 80,000 and 100,000 people seek advice from those 13 advice services each year. That is one in 10 of Birmingham’s citizens, or one in four families. Such is the scale of need that those admirable institutions meet at present.
It would appear that the cuts are not just cruel and callous; they may be unlawful as well. The National Council for Voluntary Organisations, an admirable organisation, has written to Birmingham city council to raise concerns over the legality of the cuts in relation to consultation and equality impact assessments. 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.
It is essential that the Government and the council act. If a solution is to be found that will secure the long-term future of these admirable organisations, there will need to be at least interim funding while we seek a long-term solution.
Andrew Percy (Brigg and Goole) (Con)
I thank the hon. Gentleman for his comments. The situation is the same across the country. In my constituency, the CAB in Goole is facing a similar threat. I want to reinforce the point that he has just made. There has to be a long-term solution, because this is not something that has not happened before. CABs are constantly battling for various funding streams, but what we really need is something that puts their vital service on a proper, long-term footing. I entirely agree with what he has been saying.
Jack Dromey
I am grateful to the hon. Gentleman. He makes a powerful point based on his experience. The current arrangements mean that this admirable institution, the CAB, lives from hand to mouth, never quite certain that it can count on the next funding round or stream, which makes it difficult to plan. John and Paul, who are here today, are outstanding at doing precisely that, but it is impossible for them to plan if they are told in December that they will have to close in March but they might or might not get money in August. That is, to be blunt, an absolute farce and something that requires urgent action by the Government to put right.
Let me close on exactly those points. Clear views have been expressed on both sides of the Chamber that we need action by Ministers. I say this with the greatest of respect to the Minister: Ministers cannot wash their hands of responsibility. If the big society means anything—they proclaim that the CAB and advice agencies are a key part—what do the Government intend to do about the situation? Will they call on Birmingham city council to think again? That is precisely what we hope for—that Birmingham city council will think again—when the meeting takes place on Monday next week.
I pay tribute to Citizens Advice. It is an outstanding institution with outstanding employees and volunteers. It needs to be able to serve the people of Birmingham well for the next 70 years, as it has for the past 70.
The Parliamentary Under-Secretary of State for Business, Innovation and Skills (Mr Edward Davey)
I congratulate the hon. Member for Birmingham, Erdington (Jack Dromey) on securing this debate on what I agree is an important subject. I would like to thank the Members who intervened in the debate.
The hon. Gentleman used the adjective “admirable” on many occasions in describing the CABs in Birmingham, and I am sure that he meant CABs everywhere. I concur with him totally in that regard.
Mr Davey
In a second—I just want to finish this point.
Like other hon. Members, I have advice surgeries in my constituency every week. In fact, I have two every week, and have done so every week since 1997: every Monday morning at 8 am in my office, and on Thursday or Friday night, or Saturday morning. I spend between five and six hours—sometimes even nine hours—face to face with constituents every week, so I see many of the kind of cases that the hon. Member for Birmingham, Erdington spoke about, whether about benefits, debt, housing or antisocial behaviour.
My staff and I work with the CAB in Kingston. We work with organisations such as Kingston Churches Action on Homelessness and several others to help the most vulnerable in our society, and we do that willingly, as does every Member in this Chamber. We understand the importance of the CAB. I understand the importance that it has in our society, whether it is called the big society or something else. I am afraid that the hon. Gentleman will have to get behind me in the queue to praise the work of the volunteers and professional staff of CABs in every community in our country and the work of the national organisation. I hope that when he hears my remarks, he will understand that the Government do support CABs.
John Hemming
It helps to put the history on record. Yes, the decision was taken in November that money needed to be saved in this area, but the objective was to maintain services, and, therefore, interim funding was made available. The CAB took the view that it was all or nothing; it wanted to continue interim funding at the same rate at which the funding was being withdrawn. To be fair, since then I have met with the chief executive of Citizens Advice, and although the meeting started with the position that it needed to maintain interim funding at the same rate, it has now agreed to look for savings, but that is far too late. I have a meeting with Councillor Ayoub Khan about the matter on Friday, and let us hope that the CAB, rather than issuing threats of legal action, is willing to co-operate to maintain services. I ask the CAB to co-operate to maintain—
John Hemming
I ask that the Minister co-operates because there are other funding streams, which are also crucial.
Mr Davey
Let me answer the intervention first, and then I will take subsequent interventions.
The information that my hon. Friend provided then and in other interventions backs up the information I received—in no way has there been a final deal. People locally, both on the council and in Birmingham CAB, are talking to each other. Local MPs such as my hon. Friend are trying to help to resolve the issue, and are working hard on behalf of local people in Birmingham. That is exactly how it should be.
Richard Burden
May I gently put it to the Minister that those of us who have experience working with Birmingham city council know that all too often it is like trying to knit fog? Unlike the hon. Member for Birmingham, Yardley (John Hemming), rather than get my knitting needles out, I would rather get rid of the fog. If the Minister has looked into the issue, will he answer the following question? Has he taken a view on whether Birmingham city council’s actions so far in dealing with this are compact-compliant?
Mr Davey
The hon. Gentleman will not be surprised to hear that it would be wrong for a Minister to second-guess every action of every council in the country. I hope that he will agree with that. If he agrees with localism, I hope that he will agree that local authorities, and the councillors who are elected to serve, should take responsibility and be accountable to their local electors. It is important that local councillors of all parties play their role in sorting out local problems in their areas.
Ms Gisela Stuart
I am grateful to the Minister for giving way. Given that six out of the 10 Birmingham MPs are here, and they have considerable experience of working with the council, will he say whether in his view Birmingham is compact-compliant? It is a very important point.
Mr Davey
I am afraid that I am not going to give the hon. Lady an answer to that question. It is important that, as this is being settled and as the meetings we have heard about—the one that has happened, the meeting on Friday, and the meeting on Monday—try to resolve the matter, they will ensure that any regulatory demands from central Government are met.
John Hemming
Does the Minister agree that the best way forward is for the CAB and the council to op-operate on how to maintain services, rather than issue threats of legal action?
Mr Davey
This is a wider point that applies beyond Birmingham. I certainly agree that it is important that local authorities and citizens advice bureaux in these difficult times try to work together. I will talk about that in a moment, if I can make some progress.
I can give a view from the heart. A few years ago in my constituency, my local council signed up to a three-year strategic partnership with Kingston CAB to ensure that it had stability of funding. That is one issue discussed in the debate. I understand that local authorities are under serious pressure at the moment, as are Government, Whitehall Departments and all those across the public sector. We have some difficult funding times, which is hardly a secret, and such long-term deals need to be seen in that context. From my local experience, I can recommend that strategic partnerships with key voluntary players, such as the CAB and the local council, can resolve such problems more easily.
Steve McCabe
I simply wanted to ask the Minister whether he is responding as part of a double act with the hon. Member for Birmingham, Yardley (John Hemming). Will he ask the hon. Gentleman why there was no mention of transitional funds in the council report in November? That seems to have emerged when the hon. Gentleman made his contribution today.
Mr Davey
When I eventually get to that point in my speech, I will say that prior to today I was aware that there was transitional funding. I do not think that it has emerged in the past few minutes. [Interruption.] Labour Members need to hear this, because there is a backdrop to the debate, which is the record deficit that the Administration inherited.
We have had to take very difficult decisions. One of the most difficult decisions I have had to take as Minister meant telling the chief executive of Citizens Advice that his budget—this was before Gillian Guy took over—had to be cut in-year by a significant percentage. I did not like having to deliver that decision, but I knew that we had to take tough decisions because we have such a difficult spending climate. It is exceedingly important that those tough decisions are taken fairly and are implemented. Local authorities will have to face up to that issue—Birmingham city council, Kingston council and other councils as well. I shall give way to my hon. Friend, but I hope that he realises that I need to make progress after his intervention.
John Hemming
I presume that the Minister agrees that CAB funding in Birmingham was perfectly stable until the Labour Government almost bankrupted the country.
Mr Davey
It is very tempting to answer that question, but I shall make some progress.
As a result of the financial difficulties, all councils must re-examine how services are organised and run—finding efficiencies and unlocking savings. We have sought to make that task easier by scrapping most ring-fencing constraints on councils’ funding, so they have greater freedom to manage resources in the best possible way. That involves joining up back-office functions, sharing chief executives and other senior managers, and cutting out the duplication and waste associated with procurement. Where possible, that should not mean cuts to front-line services. We say that not only to Birmingham city council, but to all local authorities.
It is worth noting that, although all citizens advice bureaux are members of the national umbrella organisation, Citizens Advice, they operate independently. I am sure that the hon. Member for Birmingham, Erdington will admit that at least. Their funding is determined locally. That is not new, but has been the case for many years under the previous Administration and the Administration before that. Funding is determined by the relevant local authority. That is how it should be, because the need for advice and such services varies dramatically across the country. I am sure that the needs of Birmingham are different from the needs of Kingston. There should not be any doubt about the fact that these should be local services.
Yvonne Fovargue
Does the Minister agree that funding from the local authority often acts as seed-corn funding for the other funding that citizens advice bureaux get? For every £1 that the local authority puts in, £10, on average, from other sources is gained by bureaux.
Jack Dromey
We are getting close to the end of the debate, and it is of the highest importance that a clear message be sent to the people of Birmingham. A meeting is scheduled for next Monday and we hope progress will be made. In the event of progress not being made next Monday, will the Minister be prepared to meet a delegation from the Birmingham CAB—the admirable people who work for it, the admirable people who volunteer and some of the people who depend upon it?
Mr Davey
I would not want to prejudge the meetings that will happen over the next few days. It is up to individual councils such as Birmingham to work with partner organisations to sort out some of the difficulties. I understand that Birmingham city council has reviewed advice provision within the whole city and will be moving towards a new commissioning process in the summer. All the independent advice providers will be eligible to apply, and that will, of course, include the bureaux.
I also understand that the council recognises that there may be short-term problems for some of the independent advice providers during the period until new contracts are awarded. I believe that it has a transition fund, to which my hon. Friend the Member for Birmingham, Yardley referred, which might be used to help those organisations through that period. The meeting, scheduled for Monday, will focus on discussing that.
Those are positive developments, which the hon. Member for Birmingham, Erdington did not touch on in his speech, and it is worth putting them on record because I hope they will result in a successful outcome. I am concerned that hasty decisions taken by councils now could lead to the unnecessary loss of important CAB services not only in Birmingham, but in other areas. I trust that, when local authorities work carefully with their citizens advice bureaux to strike up the strategic partnerships I talked about, that will not happen.