Not-for-profit Advice Sector

Andrew Percy Excerpts

Tuesday 6th March 2012 Westminster Hall

[Yvonne Fovargue]

I agree. The effect on people using the services, who are disproportionately on a low income, will be devastating. Individuals will not appeal, which will end up costing the state more—hon. Members should remember that they have been unlawfully denied benefit—or may take the case themselves and be unable to present the evidence effectively or provide the right sort of evidence, or will end up at their Member of Parliament’s surgeries. I think all hon. Members will admit that we are not legal experts. However, there will be nowhere else for us to refer such people. I recommend to the Minister a report produced by the Young Legal Aid Lawyers, which demonstrates how much MPs rely on their local advice centres.

[Andrew Percy (Brigg and Goole) (Con)]

Will the hon. Lady give way?

[Yvonne Fovargue]

I need to make a tiny bit of progress, but I will later.

So far we have talked only about welfare benefits. Debt clients will lose access to early advice, giving the perverse result that they may be sent away and told, “If you get into more debt and are at risk of losing your home, we might be able to see you.” Clients who are unlawfully dismissed from employment will have nowhere to go and will end up claiming benefits.

This loss of specialist provision has great implications for the future. The experience of specialists will be lost, not just for this generation, but to future generations, because they are training other advisers—often volunteers—but will be unable to pass on their experience because they will not be there within the agency.

I remind the Minister of the cost of cases. A case such as Sharon’s, which has benefited her, cost £148. That is how much a welfare benefits case costs. A debt case costs £180 and a housing case costs £160. What are the knock-on costs to the other agencies of removing this small amount of funding?

The Minister has said many times that he disagrees with the King’s College and CAB figures on the savings made to the state by keeping such matters in scope. What is his estimate? Has any estimate been made by the Government of the knock-on costs of removing specialist work from legal aid?

The real tragedy, as my hon. Friend the Member for Clwyd South (Susan Elan Jones) mentioned, could be the loss of whole agencies. Often, large agencies have done the right thing and diversified their funding and contracted with the Legal Services Commission. The services provided by the Manchester community legal advice service were jointly commissioned by the local authority and the LSC in October 2010. A three-year contract was awarded until October 2013, with the possibility of two more years if the targets were hit—and they have been. Some £1.2 million of legal aid funding will be directly lost by that service and that is likely to have knock-on costs of another £800,000 leading to more than £2 million being lost from that service. In addition, 34 specialist advisers will be lost and 97% of the specialist services throughout Manchester will go. Contracts have been signed for premises and other essentials, predicated on the three-year contract that was given to the service. Cuts pose a risk to the continuation of the whole CAB and community legal advice service in the city of Manchester.

In effect, Manchester could become a desert in terms of face-to-face advice. Who in the city will be affected by that? The majority of the clients, as my hon. Friend the Member for Clwyd South said, are on low incomes, or have a disability, or are black and minority ethnic. They experience higher than average rates of unemployment, debt and homelessness. These are the people that the cuts will affect—not fat cat lawyers. Will the Minister please comment on the future of the community legal advice services, whose staff signed contracts in good faith and now find that those contracts are being reneged on? That is just one example.

When this matter is spoken about in the main Chamber there are many fine words from all parties, but as a feisty volunteer said to the mayor when he spoke about the CAB in respect of a funding cut, “Fine words butter no parsnips. Let’s see the colour of your money.” That is what we need.

We may talk about the transition fund—£20 million given for advice agencies—but transition, to me, means moving on. I cannot see where advice agencies are going to move to, to get specialist funding. I feel that a lot of them will be transitioning into oblivion.

--- Later in debate ---

[Andrew Percy]

I appreciate what the Minister is saying. As he must know from his surgeries, many constituents come to us and say that the last thing that they want to do is have a telephone conversation with us—they want to see us face to face. Can he assure us that residents who need assistance and do not want to access it down the telephone line—a lot of older people in particular have problems with that—will continue to be able to get face-to-face advice?

[Mr Djanogly]

The telephone service will be used only in a limited number of areas, so that we can see how it works, and yes, if someone is unsuitable for receiving telephone advice, perhaps because of their age, the alternative of face-to-face advice will be available.

I am pleased to see good examples of not-for-profit organisations acting innovatively, forging partnerships with other organisations and adapting to the changing face of advice provision. I accept that the proposed reforms are likely to be particularly challenging to the not-for-profit sector. Legal aid, however, is only one of many funding streams that citizens advice bureaux and law centres receive. For example, legal aid represents only 15% of the income of citizens advice bureaux. I also point out that our scope changes have not yet happened and will not do so for another year, giving us time to look at the changing needs of the market. Indeed, one of the major issues for the sector is changes to other sources of funding, such as local authority cuts, which are determined by local priorities, not central Government.