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The Scottish Council for Voluntary Organisations (SCVO) has accused the Government in London of imposing “criminal cuts” in welfare which will “devastate families and communities in Scotland”. It’s published a new survey which suggests that Third Sector organisations could “struggle to pick up the pieces of the biggest attack on the poor in generations”. The report main conclusions include:

• Three quarters of charities expect demand for services to increase significantly over the next year
• With 80% of welfare cuts still to come, 63% of charities will be affected by welfare reform
• 57% of organisations engaged in welfare activity are providing crisis support and
• 69% are providing advice on benefits
• 81% of charities expect the financial situation for the sector to worsen in the next 12 months

The figures show that 81% of charities in Scotland expect the sector’s financial situation to deteriorate over the next year and they are concerned about meeting the record high demand for services as welfare cuts kick in.

In the view of Martin Sime, the SCVO’s Chief Executive, “It’s clear from this research that Westminster’s criminal cuts to welfare are putting so much pressure on charities’ services that some will struggle to keep up with demand from people and families in Scotland. The unprecedented worry and uncertainty surrounding the cuts is hitting the poorest the hardest as they face an endless cycle of appeals, bureaucracy and misinformation. All this on top of trying to get by on a day-to-day basis is pushing people and families to breaking point.

“The sector is pulling together to pick up the pieces and help to mitigate the terrible effects of these ill-conceived Westminster cuts which should never have happened in the first place.”

Nicola Sturgeon MSP, Deputy First Minister and Cabinet Secretary for Infrastructure, Investment and Cities, will address 200 charity representatives from across Scotland when they meet in Edinburgh today to make a stand against Westminster’s cuts and to work together to combat the chaos they are creating. In advance of the meeting, she pointed out that “The ink may only just be dry on the UK Welfare Reform Act 2012, but we must not stop making the case on behalf of some of Scotland’s most vulnerable people.

“Despite our opposition – and that of large parts of Scottish Society – the UK reforms are coming too fast and against the backdrop of some of the biggest cuts to the welfare system in a generation. It is voluntary organisations, local authorities and charities and that will be picking up the pieces. The Scottish Government – under the current constitutional settlement – will do all it can to mitigate the impact of these cuts and changes although there are consequences that are out-with the capability of the Scottish Government’s powers.”

A shut job centre. Picture: Alan Denney

A shut job centre. Picture: Alan Denney

By John Knox

There is a great deal of hand-wringing about youth unemployment, part-time employment, women’s unemployment, extending the working age. But none of it seems to lead to new jobs.

It is all very well having training schemes, welfare to work programmes, talk of innovation, entrepreneurship and of serving niche markets. But none it will work unless there are new jobs being created in the economy.

Unemployment in Scotland now stands at 221,000, or 8.2 per cent of the workforce. On the face of it, the figure is dispiriting but not unusual. It is better than in the last quarter. It is the same as the rest of the UK. It is much better than the average across Europe of 10 per cent. But almost all of this fall in unemployment can be accounted for by part-time jobs. Around 27 per cent of workers now work part-time.

Certainly this is one way of creating jobs. But part-time work implies part-time salaries –and this is not only hard on family budgets, it means less demand overall in the economy. In short, it is the price we are paying for the bankers’ recession.

And the overall figure of 8.2 per cent unemployment hides the most worrying trend of all, youth unemployment, now rising to 22 per cent in Scotland and up to 50 per cent in other parts of Europe. Not a good start in life for our young people, who have battled through school and college on the promise of a place in work-a-day society at the end of it. It is also bad news for the housing market, with young people unable to get on the housing ladder.

Another way of creating jobs is the government’s way: waiting and hoping that the private sector will finally start investing in new factories, shops, houses and other commercial ventures. But why should they, when the economy is flat on its back and the prospects for growth are around 1 per cent for the next couple of years? These flimsy hopes are given some public credence when we see firms such as Vauxhall investing £125m in its car plant in Ellesmere Port and creating 700 new jobs or Aker creating 500 new jobs in the oil industry in Aberdeen.

But neither of these companies are British and they run counter to the general trend of a decline in oil and gas production and in general manufacturing. Only 10 per cent of Britain’s economy is concerned with making things, most of that work is now done by cheaper labourers abroad. And the recession has made things worse. The GMB union estimates that since the crash in 2007, Britain has lost 700,000 jobs in manufacturing (46,500 of them in Scotland), a rate of 3,000 a week.

Right-wing economists believe that this trend can be reversed by cutting taxes, particularly taxes on jobs and corporations, and by cutting so-called “red tape”. This is the third way of creating jobs. Unfortunately they never define “red tape”, so it is not easy to see what they mean. One has visions of working hours being extended, minimum wages cut, pension rules relaxed, a programme of deregulation. It strikes me as a sort of nostalgic return to the world of the Victorian sweatshop. And wasn’t it deregulation which got us into this recession in the first place?

The other disadvantage of tax cuts is that they generally lose the Treasury money. So our right-wing economists would need to explain how they would pay off the national debt or where the extra cuts in public spending might be made. Some of the braver souls may argue that the tax cuts might pay for themselves by boosting the economy in the long run. And the less brave would say they could be massaged away by allowing inflation to rip, thereby causing the government’s other tax revenues to increase. None of this would work, though, when the basic problem is a lack of demand in the economy.

A fourth way of creating jobs is to stop cutting them in the public sector. Already this government has cut 270,000 jobs across the UK. The Office for Budget Responsibility suggests this will rise to 730,000 by 2017, about one in seven public sector jobs. And Scotland will be more than proportionally affected. The OBR forecast then goes on to predict that the private sector will more than make up for this, with the creation of 1.7 million jobs, on the curious theory that cutting the public sector in some way leaves room for the private sector to expand, as if the two were opposing forces in a zero-sum game.

Not surprisingly, the theory is not working out too well. Last year, private businesses created just 226,000 jobs, about half the predicted number – and, as we have already seen, many of them (at least a third) were part-time jobs.

This leaves us with a fifth way of creating jobs, which is the good old-fashioned tried-and-tested method – invented by old Father Keynes – of increasing public spending at a time of recession and paying off the debts when the economy recovers. We began work on this in the immediate aftermath of the banking collapse, with the decision by all leading economies to pump massive funds into the banks and increase public expenditure. It was followed up by the so-called Bretton Woods II G20 summit in Washington. Since then there has been some backsliding by the Europeans, including Britain, under both Labour and the Coalition.

Instead, we have landed ourselves in the age of austerity where none of the experts seem to know where growth is going to come from. Happily, there is now a popular rebellion against this madness, as we have seen in France and Greece recently. In Scotland, the SNP surged to victory last year on an anti-cuts agenda and in the local elections in May we saw the austerity parties punished again.

But we cannot just go on as before, into another round of boom and bust. The financial crisis has changed the world we live in. National debt is too high – 80 or 90 per cent of gross national product. High levels of personal debt, easy credit and optimistic mortgage payments have to end. Growth is more likely to be at 1 per cent than the 2 per cent we have been used to. And growth in gross domestic product needs to be redefined, in any case, to take account of sustainability.

But all these changes can be made while old Father Keynes is pumping more government spending into the system. We can grow austerely. It means bringing wage rises under control – around the 1 per cent level. It means keeping people in public sector jobs but developing them, so we don’t recreate the imperial Indian civil service. It means choosing sensible public works projects.

It is no use, for instance, building large bridges over Scottish estuaries, or barrages in the Bristol Channel, because they take a long time to begin creating jobs. It is better to employ unemployed teachers, community nurses, social workers or sports coaches who can begin spending their wages immediately and creating demand in the economy, to which the private sector can then respond. I am thinking here of the retail trades and the house-building industry.

The state may well have to invest in new railways or renewable energy, or science research to encourage private companies to enter new fields, but these are long-term projects. These will create jobs in the future. We will need those jobs too, just as we need jobs now.

It is little noticed, in all this talk of recession, that the number of people in work has never been higher. Over 70 per cent of the working-age population have a job, 29.2m in the UK, 2.4m in Scotland, and the numbers have risen in the last three months. Most of this increase, as I say, has been because of the number of part time jobs and we may be seeing a long-term trend of people preferring to work part-time. But still more jobs will be needed in the years ahead as the population grows and as people stay on longer in work.

Across the world, it seems to me, one of the major problems facing governments is the shortage of jobs for their growing populations. People are flocking towards the cities looking for work. The Arab spring was partly about the lack of jobs for the well-educated young. Machines are increasingly taking over the labour-intensive tasks in agriculture and manufacturing which means we must move on to the service industries and to education, health and social care, the arts and sport where there is an infinite need for labour.

Much of this work can be done by the private sector – but where private companies do not create a market, or enter the market, then the state has to do a little the pump-priming. It seems that a 50/50 partnership between private and public sectors is the most successful model at the moment, with most western economies gravitating towards this share of GDP.

It does not mean that the shape of each economy should be the same. Some will have large corporations running the show, others will have small firms competing, others will have state corporations or arm-length agencies, others will give tax breaks to new companies or for workers-co-operatives, others will have charities or voluntary organisations running their social care or arts or sports industries. It is up to the politicians to set up the framework by which their economies will function.

But the politicians need to give up admiring the sepia photographs of Britain’s former life. Manufacturing is important – but it is only a tenth of the economy. Exporting is important – but it is only a third of the British economy. We do not have to be more “competitive” than the rest of the world. There is no particular wealth-creating sector of the economy. All contribute. Most of our wealth is created simply by people earning their wages – no matter what jobs they do – and spending those wages on goods and services which the rest of us provide.

You will have noticed that, of the five ways of creating jobs (part-timing, austerity, tax cutting, maintaining public services and pump-priming), I prefer the last two. They may all work, after a fashion, and indeed we have tried them all. But obviously we have not tried hard enough and we are left with a country still in recession and with 2.6m lives blighted.

Martin Sime, SCVO chief executive

Martin Sime, SCVO chief executive

New research suggests that Scottish voluntary organisations saw their income drop by almost £100 million last year.

According to the Scottish Council for Voluntary Organisations (SCVO), some groups were having to dip into reserves to keep services open. While many charities were facing budget cuts, they also had to cope with an increase in demand for their services.

More than 270 voluntary groups responded to the survey. Four out of 10 said they had used their reserves to maintain services because they were spending more than they received. At the same time, three-quarters expected demand for their services to continue to grow over the next year.

The SCVO called on the government and the other public sector bodies which provide money to make longer-term commitments to help provide some stability. It also called on ministers to commit to longer-term funding agreements.

Martin Sime, SCVO chief executive, described confidence in the third sector as “low despite the fact that politically [it] is becoming more prominent and its role in public services is being promoted. The sector can’t perform without a degree of stability, so in this difficult climate the case for three- to five-year funding agreements is even stronger.

“Voluntary organisations need a new and better deal from the public sector which delivers on the high level of rhetorical support. Local government in particular needs to start doing things differently.”

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Endurance <em>Picture: Frank Hurley / Royal Geographical Society</em>

Endurance Picture: Frank Hurley / Royal Geographical Society

By John Knox

“She’s going down,” Ernest Shackleton told his men as he ordered them to abandon their ship, Endurance. They had indeed “endured” the Antarctic winter of 1915 trapped in the ice when their leader was finally forced to adopt a Plan B. We are still waiting for our own leaders to adopt a Plan B, and meanwhile the watchword is “endurance” as we face a winter of many discontents.

It is clear from the UK party conferences that there is to be no end to the age of austerity. The government cuts are going ahead and the private sector is still iced up in near-zero growth. To add to the gloom, the trade unions are planning a series of demonstrations, and balloting for strike action, over pay freezes, job losses and increasing pension contributions.

We now have to see what the Scottish parties will make of all this in their upcoming conference season. And, more importantly, we have to see what the 32 local councils will do in the face of the biggest freeze in their budgets since devolution. It is the councils, after all, who will have to do most of the cutting and most of the after-care.

Nearly £500 million has been cut from council budgets, 5 per cent, and the council tax has been frozen hard, like the Antarctic ice. The unions are predicting that 10,000 jobs will have to go and many council services will sink like the good ship Endurance. They are calling for a Plan B in which the government spends more now to get the economy back into growth and pays off the debts later by taxing the rich and the avoiders. Alex Salmond has his own Plan MacB in which we spend more now and the future will look after itself in an independent Scotland.

There is however a Plan C emerging. It is to centralise the public services like police and fire and – only hinted at so far – care services and education. The thinking from the SNP, Labour and the Conservatives is that centralising services will save money by avoiding the duplication of back office functions such as personnel management, wage payments, insurance, training and procurement. In the case of police and fire services, the government estimates a single force would save £130m a year in the long run.

But Plan C, to my mind, is either cunning or concerning or just plain crazy. Cunning, because it is a power-grab by Holyrood, replacing local councils in effect but keeping them as a human shield when things go wrong. Concerning, because centralisating usually turns out to be an expensive business and when mistakes are made at the centre, the whole country suffers not just one council area.

And crazy because, ultimately, the same amount of work has to be done – streets patrolled, fires put out, elderly folk looked after, schoolchildren taught. If there are savings to be made in personnel management or procurement etc, then they can be made locally – it is called “efficiency”. Any worthwhile computer system would allow a local manager to shop around or manage his wage bill and learn lessons from his colleagues in other councils.

We all have our own Utopia. Campbell Christie has his, it is called the Commission on the Future Delivery of Public Services. This worthy report laments the fact that “the public services system in Scotland is often fragmented, complex and opaque”. It finds it too top-down, unresponsive to the needs of individuals and communities and too short-term.

But the Commission has largely been ignored. Partly because it failed to provide a route map to its solutions and partly because it did not recommend what was expected of it, namely more centralisation. Instead Dr Christie’s Utopia seems to consist of many smaller councils (he points out that in Scandinavia there are three times as many as in Scotland) tailoring services to individuals – particularly the disadvantaged – and a massive transfer of resources from acute services to preventive measures: from hospitals to care in the home, or from universities to early learning, or from prisons to community service.

It is true that the finance secretary John Swinney did allocate an extra £500m to preventive measures, but that is over three years and is 0.5 per cent of his budget. Clearly Mr Swinney is not heading for the same Utopia as Dr Christie – or if he is, he is travelling at 0.5 mph.

The other parties are not going anywhere fast, either. Labour just want to go on with the system as it is, but with a third fewer cuts. The Conservatives want to privatise as many services as possible and leave the rest to local boards of enterprising individuals. The Liberal Democrats and the Greens are keen on local co-operatives and charities running services. And indeed I share their enthusiasm.

But my Utopia lies much further away. I would like to see our existing councils given back the services they once ran at a local level and given the freedom and the budgets to do their own thing. Let local managers manage. Local Health Partnerships, for instance, are showing the way forward, where health boards and local councils are working together to integrate hospital care with care in the home and care in the nursing home.

In the longer term, I would like to see the 14 regional health boards abolished and their staff and budgets passed to local councils so that health can be integrated with care services, social work, education and sport.

I gather that the councils in Orkney, Shetland and the Western Isles are experimenting with what they call “a single public authority model” in which the council takes responsibility for all public spending in its area. This makes sense. It should end the “silo mentality” so heavily criticised in the Christie report.

In the long run, I would like to see this devolution applied to Scottish Enterprise, Scottish Water, the Scottish Environment Protection Agency, Scottish Natural Heritage, Visit Scotland, Scottish Sport and the 20 universities and 41 colleges. This would be a huge shift in power, responsibilities and resources, away from Holyrood and out to the districts. But it is what devolution – or “subsidiary”, to give its European name – is all about. The central government should be there just to regulate, inspect, advise, crisis-manage and make the overall laws. The councils’ job is to “do”, to actually deliver the public services to their people, efficiently with local knowledge and sensitivity.

It’s also a matter of quality jobs. There is a talented and experienced workforce out there in the 32 councils which is being second-guessed – or worse still, directed, by a highly paid bureaucracy at the centre who have no hands-on experience. I am not saying that each council should work away in its own “silo” – there can be cross-border co-operation where it is sensible. Smaller councils may want to join forces for certain purposes. But it should be on an ad hoc basis and only when it suits each council.

Happily, there are already signs that my Utopia is not far away, like the twigs brought back by Noah’s dove. Even in the justice secretary’s plans for a single police force, there is an admission that each council will have to have its own superintendent – in effect, its own chief constable. Many of the great quangos of state have local offices. The government has tried intermittently to end the ring-fencing of budgets so that councils can order their own priorities. It is just a pity that when they do so, they are criticised for creating a “postcode lottery”.

So there is my alternative to Plan C. Let us call it Plan D, for devolution. It does not have to happen overnight, it is more a direction of travel. But I believe it would keep employment up, job-quality up, and deliver better public services. It could be done within existing budgets – indeed it has to be so in this age of austerity. It might even be a rescue plan, as daring as Shackleton’s and almost as dangerous. But remember, the ship is going down and something has to be done.

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<em>Picture: Berto Garcia</em>

Picture: Berto Garcia

By John Knox

Now it is plain for all to see. Teachers, nurses, dustbin collectors, social workers, park-keepers, librarians, environmental health inspectors and the rest of the long list of public employees are the unfortunate people who will have to pay the price of the bankers’ bailout. A pay freeze is the chosen instrument.

It was the centrepiece of John Swinney’s £28 billion budget announced in the Scottish parliament on Wednesday. Behind the finance secretary’s accountant-style delivery, you could feel his anger at being forced to cut and cut and cut to help pay off the £850bn debt heaped on the UK by the bankers.

“Between 2010–11 and 2014–15,” Mr Swinney told MSPs, “Scotland faces a real terms cut of 12.3 per cent – £3.7bn – including a real terms cut of 36.7 per cent to our capital budget. Against this stark backdrop, we will steer a distinct course and make the very best use of the constrained resources available to us.”

There will be a pay freeze for everyone in the public sector earning over £21,000 a year. It will last at least another year, and will probably be followed by below-inflation increases for the next few years. This unpleasant reality is what is meant by the pleasant-sounding word “efficiencies”. This, and job cuts of course: 25,000 in the last year.

To be fair, Mr Swinney has tried to stave off the job losses – and stimulate the economy – with the SNP’s “Plan MacB”. Over £750 million is being transferred out of revenue expenditure and into capital projects such as the new hospital in Glasgow, the school building programme, low-cost homes and the new Forth Bridge.

The health budget of £11.5bn is being “protected” in money terms – but, when inflation is taken into account, there is a real cut. But some important savings for the NHS will come in the long term from Mr Swinney’s new £500m fund – over the next three years – for preventive programmes aimed at three specific groups: the elderly infirm, deprived children and young offenders.

Controversially, about one-fifth of that money is to come from a levy on supermarkets selling alcohol and cigarettes, the causes of much NHS expenditure. The supermarkets say they are being discriminated against and that most problem drinking is caused by people buying from corner shops.

The main losers in this budget are the local councils. They are being given just £8.8bn (a cut of 7 per cent in real terms) and being forced into freezing their council tax. The government says councils will have to borrow money if they want to build more schools or homes or improve their roads.

Scotland’s 41 further education colleges are another set of losers. Their budget is being cut by £70m. Some may be forced to merge. Opposition MSPs are asking how this squares with improved youth training and the programme for 100,000 apprenticeships. The 20 universities fare a little better, with an increase of £140m next year. But it is less than the £200m the universities say they need to keep up with English universities which, next year, will rake in £9,000 per student.

So there are plenty of controversies to help MSPs while away the winter until this “draft” budget is passed in the early spring. But “draft”, in this case, means “more or less fixed” because the SNP, for this first time, have a majority in parliament.

The real controversies will take place in the 32 councils which have to implement much of this budget. Will they dare to defy the council tax freeze – which, in law, they are entitled to do? Will they tear up the concordat which has seen a partnership between central and local government over the last four years? Will they just stop providing services and explain to aggrieved residents that it is all the fault of government cuts?

And this council-rumbling will take place as local elections are looming next spring and the trade unions embark on a winter of discontent. They have plenty of be discontent about: the pay freeze, job losses, unemployment, higher pension contributions. The unions’ argument, that the deficit should narrowed by closing the tax loopholes enjoyed by the rich and by the large corporations – and not by ordinary workers – may begin to find traction through such a winter.

In the face of this swelling unease, there are signs that the coalition at Westminster is beginning to lose its nerve. Vince Cable, the business secretary, was likening the threat of world economic collapse to being “at war”. There were rumours at the Liberal Democrat conference of the government contemplating a Plan B, spending more on capital projects to get the economy back into growth.

And with the warnings from the International Monetary Fund and others of only 1 per cent growth next year and higher and higher unemployment, followed by dramatic falls on the stock market, Plan B becomes more and more likely. John Swinney’s Plan MacB may prove to be the Scottish experiment that shows the way.

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Theresa Fyffe of RCN Scotland

Theresa Fyffe of RCN Scotland

Theresa Fyffe
Director of RCN Scotland

In light of the announcement on cuts to the NHS workforce this week, one thing is clear: NHS Scotland- and the Scottish Government – face a massive challenge. Our health service has a declining workforce, yet needs to deliver high quality services to more and more people who are living longer and have increasingly complex health needs.

It is all very well saying the NHS budget is protected, but when that budget is not enough to even keep services at a standstill – as costs and growing demand outstrip funding – a more meaningful way out of the current situation needs to be found. This is being made all the more urgent by the fact, confirmed in individual health board projections also published this week, that the NHS is set to lose even more nurses by the end of this financial year.

The Scottish Government’s argument that the NHS does not need as many nurses because of advances, such as increased day surgery, just does not stack up. If people are being cared for at home rather than in hospitals, where is the evidence of a corresponding investment in community nursing and other services outside of hospitals? We certainly have not seen any evidence of this so far and it is not immediately apparent in any health board plans for the future.

The pressure on health boards to balance their books and make increasing savings – this year they are required to make 3% efficiency savings, which Audit Scotland thinks may be unachievable given the public sector’s finances – has resulted in them chipping away at the workforce to save money. This has largely been done by not replacing staff when they leave or offering voluntary redundancy packages as, thankfully, compulsory redundancies have been ruled out by the Scottish Government. This approach, however, means that remaining staff are often delivering the same services with fewer staff, for more patients.

So this leaves the NHS in an extremely difficult situation and the Scottish Government needs to show some leadership. Instead of demanding that health boards balance their books, while making increasing savings with less and less staff, the Government needs to set out a vision for the NHS. For instance, could more effort be put into reducing non-workforce costs such as sharing clinical and backroom services?

Instead of devolving all responsibility for tough decisions to health boards, the Government must support boards by taking the difficult regional and national decisions which are needed to manage demand and change services, while also maintaining quality. Indeed, the public is far more willing to consider radical suggestions for improving services than they are given credit for. For example, a YouGov survey we carried out earlier this year showed that, even if they may have to travel further, 75% of Scottish people are more likely to support the creation of specialist healthcare centres, for complex surgery or cutting edge cancer treatments, for example, if this freed up NHS money to improve local healthcare.

So if the pressure is mounting on health boards, staff are overstretched and the public is willing to support radical decisions, it is most definitely time for the Scottish Government to step up to the plate.: Fewer and fewer nurses cannot provide more and more services to more and more people. The Government needs to be bold and support local health boards by taking the very difficult decisions needed to change the way services are delivered and to reduce demand. The alternative – more finance-driven, local cutbacks to professional healthcare staff – can only put patients, nurses and services at risk.

<em>Picture: Langspeed</em>

Picture: Langspeed

Two surveys out today suggest that the jobs market is fragile. A Bank of Scotland survey reports that a growing number of workers in Scotland found jobs in July, but the economic crisis meant that the improvement would be hard to maintain.

The quarterly forecast by the Chartered Institute of Personnel and Development (CIPD) and KPMG warns of a drop in business confidence leading to a loss of jobs later in the year.

The Bank of Scotland “Labour Barometer” is based on a monthly survey of around 100 recruitment and employment consultants. It’s a snapshot of how these organisations view the current market conditions, looking at such things as demand for staff, employment and availability for work and pay. Any figure above 50 represents expansion in the market; one below 50 means contraction. In July, the barometer measured 55, fractionally down from June, but the figure was higher than the UK average.

“The Scottish labour market showed a further improvement in July,” said the bank’s chief economist, Donald MacRae, “with both permanent and temporary staff appointments increasing strongly. There was a rise in the number of people placed into permanent work, bringing the current period of growth to ten months. However, it will be difficult to maintain improvement, given the concerns over sovereign debt in the eurozone and slowing growth in the USA.”

That view is shared by the CIPD, which surveys 1,000 employers across the UK. Its report suggests that the number of employers hiring staff has dropped, with the jobless figures set to increase in the coming months. If this prediction is fulfilled and the past year’s drop in unemployment is reversed, then it will be a serious blow to the government’s economic policies.

“On average, growth in hiring intentions has been reported throughout the past year,” says the CIPD report, “but a more sombre outlook is now being driven by a fall in confidence among private sector employers, particularly in manufacturing.” The report adds that the number of firms taking on new staff has fallen by a third over the last three months.

According to Gerwyn Davies, public policy adviser at the CIPD, “increasing uncertainty about growth prospects in both the UK and global economies is now affecting hiring intentions, particularly in those industries such as manufacturing that stand to lose most in the event of a global slowdown. Together with the public sector redundancies, which will affect one in 20 frontline workers according to our survey, the recent story of an employment revival may become one of an employment relapse.”

Andrew Smith, chief economist at KPMG, adds that “the economic storm clouds are gathering. Hopes of a general rebalancing in the economy, away from consumption towards exports and investment, are being dealt a blow by sinking manufacturing confidence – undermining hopes that cuts in public sector employment will be offset by the private sector.”

The reports will make depressing treading for the government, especially following last week’s decision by the Bank of England to cut its forecast for economic growth this year to 1.4 per cent. At the time, the bank’s governor, Mervyn King, warned that headwinds for Britain’s economy were growing by the day.

This means that more attention than usual will be paid to the latest unemployment figures, due out on Wednesday. There are already nearly 2.5 million adults out of work, nearly a million of them young people. Some economists expect the number of claimants to rise by 20,000 in the latest figures, though the unemployment rate of 7.7 per cent is expected to remain stable for the three months to June.

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ncvoA report published today by the National Council for Voluntary Organisations (NCVO) suggests that charities in England and Wales are facing a cut in their funding to the tune of £2.8bn over the next five years.

Counting the Cuts bases its calculation on figures of the government’s projected spending plans released by the Office for Budget Responsibility.

NCVO made its calculation by assuming that each government department will continue to fund the “third sector”, but in proportion to that department’s total spending. With every department having to make substantial savings, that means that the amount payable to charities will decline in line those budget cuts.

Even so, the report warns that this may underestimate the scale of the financial impact on charities. It points out that, as a result freedom of information requests, they have discovered that almost half of all local authorities will also reduce the proportion of their spending on the sector as well as their net spending.

“Putting an authoritative figure on the extent of the cuts to date has been like trying to pin jelly to the wall,” said Karl Wilding, head of policy and research at NCVO. “Estimates have varied widely and this report provides a solid baseline figure based on the government’s own figures.

“Many charities are unwilling to speak out for fear they will jeopardise other funding streams but we currently face the perfect storm of an increase in demand and nearly £3bn public sector cuts – this is a significant cause for concern because it will significantly hamper the ability of charities to support those most in need.”

In response to the findings, a spokesman for the Cabinet Office explained that the “Big Society” offered the voluntary sector opportunities to grow, adding that “our reforms will allow the voluntary sector to bid for public service contracts worth billions of pounds. Just over a week ago Big Society Capital launched with an expected £600m to give the sector access to much needed finance, which will help them expand and bid for these new contracts. And we’re doing more to support giving and philanthropy including measures in the budget estimated to be worth £600m over the lifetime of the parliament. This is just the start.”

Although the report focuses on the position south of the border, there are fears that the impact could just as hard in Scotland. In the view of John Downie, director of public affairs at the Scottish Council for Voluntary Organisations (SCVO), “The NCVO report demonstrates some of devastating impact that will be felt over the next four years by the coalition government’s austerity measures. However, our own estimates for the drop in spending on the third sector in Scotland are even more dramatic.

“While this report just looks at funding to the sector through the Scotland Office, cuts to the Scottish block grant are much greater cause for concern. Conservative estimates put the drop in block grant at 11 per cent over the spending review period. If the Scottish government were to pass that on to charities and voluntary organisations, the sector could lose as much as £200 million, leaving thousands of vulnerable people without the vital lifelines they rely on.

“We are confident however that the Scottish government will not pass on a cut of anywhere near this size but continue to invest in the third sector, to ensure that the sector can increase its economic contribution, have a stronger presence in delivering public services and to use its expertise in employability to create opportunities for our young people.”

He said that the figures used in the NCVO report were based on spending by central government departments in Westminster. That meant looking at spending by the Scotland Office rather than the Scottish block grant. SCVO point out that the Scottish third sector has a turnover of £4.4bn, 42 per cent (£1.8bn) of which comes from central and local government. Using the same calculation as NCVO, it argues that funds the Scottish sector receives from central and local government funding would be cut by over £142m.

In a statement, SCVO pointed out that “the most important issue for us is the impact on the block grant – if we assume that the Scottish government, and subsequently local authorities and government agencies, were to pass that cut on the voluntary sector, the total cut as a result of government spending cuts to the third sector in Scotland would be £203,280,000.

“SCVO does not believe that the Scottish government will pass a cut that size onto the third sector. They want to invest in sector and their desire is for the third sector to increase its economic contribution, have a stronger presence in delivering public services and to become more sustainable. And in relation to the prevention agenda they know it’s the only way they can reduce spending on public services in the long-term.”

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RAF LeucharsAs widely expected, the UK defence minster, Liam Fox, has announced that RAF Leuchars is to close, despite a campaign by all political parties in Scotland for it to remain open.

With the earlier closure of Kinloss, this leaves Lossiemouth as the only RAF base in Scotland. In all half of the service’s personnel north of the Border have been cut.

As with RAF Kinloss, Leuchars is to become an army barracks. But, despite the increase in army numbers, Scotland continues to have a lower proportion of defence personnel than the rest of the UK.

The cuts were not restricted to the air force, with 45 Commando to move from RM Condor at Arbroath to England within six years.

Edinburgh’s Dreghorn, Redford and Craigiehall barracks are to close, with a new base being built at Kirknewton.

Announcing the cuts, Dr Fox said: “This government inherited both a national economic disaster that represented a strategic threat, and a defence programme undermined by a £38bn black hole.

“This failure to set out a coherent long-term strategy for defence and to effectively match commitments to resources is one of Labour’s worst legacies.”

He outlined plans to invest heavily in reserve forces over the next ten years to cover reductions in the number of regular army personnel, with territorials making up 30% of a 120,000-strong force by 2020.

The SNP’s defence spokesman, Angus Robertson MP, said: “The UK Government had the opportunity to reverse more than a decade of decline in Scotland’s military footprint but has instead confirmed further massive and disproportionate cuts to the RAF and Royal Marines as well as the closure of military facilities.

“However the MoD try and dress this up, RAF personnel numbers are being cut by more than fifty per cent and the Royal Marines cut almost entirely in Scotland.

The SNP MSP for North East Fife, Rod Campbell, said: “This is a dark day for Fife as the UK Government presides over the end of the RAF’s 100 year presence at Leuchars. Coming just days after the UK government said that it would shut Fife Ness coastguard station, my constituency is paying a high price for the policies of the Liberal-Tory coalition.”

Annabel Goldie, the Scottish Conservative leader, said: “We wish the circumstances had been different, that there had been no £38bn black hole inherited from the last government and such a review had not been necessary.”

Mill Glen closure notice

Mill Glen closure notice

It is perhaps inevitable that discussion of the effects of the cuts and general economic restrictions tends to focus on urban projects, given that the population density is so much greater in such areas – but there are rural consequences, too.

One example, from the world of recreational land use, can currently be found in the southern approaches to the Ochils – the handy, half-day-sized range of hills on the northern edge of the central belt. Here, one of the main access routes both for hillwalkers and low-ground strollers – the Mill Glen at Tillicoultry – is closed, awaiting repair, with no immediate sign of it being reopened.

The majority of ascents of Ben Cleuch, the highest hill in the range, are made from the Hillfoot villages of Alva and Tillicoultry, or from the woodland park picnic site just off the A91 between the two Clackmannanshire communities. The most popular way of all is to start in Tillicoultry, walk along the gorge of the Mill Glen to the bridge at the foot of the Law (the best part of a kilometre in distance and requiring a deceptive 130 metres or so of ascent along paths and stone steps built in the early 20th century), before a steady 450-metre uphill grind brings the plateau, from where easy-gradient ground brings the 721-metre high point with its fine 360-degree views.

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Except that, since February this year, the lower part of this direct way up has been out of bounds, with Clackmannanshire Council having closed the glen due to risk of rockfall. There are plenty of other ways up, from Tillicoultry and elsewhere, so it’s not as if the hill itself is in any way out of bounds. But the Mill Glen (or Tillicoultry Glen as it is sometimes known) provides the most direct approach, and has steadily increased in popularity since a footbridge was constructed across the Gannel Burn at the north end of the walkway in the late 1980s.

There are three main Hillfoot glens, each with a different management situation. Dollar Glen comes under the governance of the National Trust for Scotland, while Alva Glen is mainly under traditional local authority control but with the Alva Glen Heritage Trust also taking an interest. The middle one of the three, the Mill Glen, is essentially a council-only job – or at least that’s what appeared to be the case until the complexities of modern-day repair funding kicked in.

All three glens have maintenance issues, mainly involving bridge and walkway repairs or concern over rockfall and landslips, and the Mill Glen is particularly vulnerable at a couple of points. Roughly halfway along on the eastern side, wet weather or freeze-thaw conditions can see rubble or even the occasional tree fall across the path and into the burn – there was a significant landslip of this kind two winters ago following a multi-day deluge.

And near the southern end of the glen, on the western side just along from where a massive area has been quarried away over many decades, some very shoogly rock pillars could cause considerable damage were they to ever topple just as someone was passing underneath. It is this stretch – of only a few strides, but increasingly loose-looking – that initially prompted the closure.

“Consultants were appointed in late 2009 to assess the risks from man-made structures, natural features and vegetation in Alva and Tillicoultry Glens,” said Martin Dean, the access and countryside projects officer for Clackmannanshire Council, when asked in April 2011 for some background to the situation.

“Their report, in March 2010, identified that there was a high risk of major rockfall on to the path in Tillicoultry Glen, at a point just north of the quarry. The path is a core path and is the principal route to Ben Cleuch. They identified that the risk should be addressed in the medium term, ie within 12 months. A working group was established to look at how the council should address the matter and met for the first time on 30 September 2010.

“It was agreed (after consultation with the Health and Safety Executive and consideration of relevant legislation, guidance and good practice) that signage which warns users of the risk of rockfall should be posted at the top and bottom of the glen, and that a safe alternative route on the east side of the glen should be highlighted for those not wanting to expose themselves to the risk. Relevant persons and groups were advised of our actions and the signage inspected at regular intervals.”

This duly happened – the signs went up in early October 2010, but were at that stage merely advisory. They warned of the risk from rockfall on the short stretch past the old quarry, while stopping short of formally forbidding walkers from going that way. That was to change, however.

“The risk from rockfall in Tillicoultry Glen was discussed by the Access Forum at a meeting in January 2011,” said Dean. “Reservations were voiced by some members over the actions taken by the council, with some suggesting that a precautionary approach should be adopted. Inspections by the Ranger Service during the winter identified a number of minor rockfalls in Tillicoultry Glen and raised the possibility that the rock identified at risk of rockfall might be less secure than it had previously been.”

The council’s legal services department reviewed their position and in February the path was closed under Section 15 of the Land Reform (Scotland) Act 2003. Closure signs were put in place at both ends of the glen – a little way along from the southern end where it meets the road in Upper Mill Street, Tillicoultry, and also at the point where the “safe alternative route” – the slightly longer “outside path” or “middle path” which contours the hillside to the east of the glen – drops to meet the walkway just before the bridge at the start of the main hill-climb.

Four months on, this remains the situation, with some work having taken place but not enough to allow a reopening – there is still said to be a “medium to high risk” of rockfall alongside the quarry. In the course of the initial work, however, a further problem came to light, concerning one of the half-dozen metal bridges that allow the walkway to worm its way into the hills. “[The contractors] also advised that the condition of the rock supporting the uppermost bridge gives cause for concern,” Dean said, “that failure of the abutments is most likely to happen when the bridge is occupied, and that [carrying out] repairs to the bridge is the higher priority.”

As to the cost, both sets of repairs – to the quarry-side rocks and to the problematic bridge – are expensive: Dean quotes figures of £33,500 and £23,500 respectively. Clearly this money has to be raised before the glen can reopen, but from where?

“Revenue budgets have reduced across all council services in Clackmannanshire as a result of reduced government funding,” Dean said at the end of May. “This has implications for countryside maintenance, including path repairs. Repairs of the scale of those in Tillicoultry Glen are outwith the scope of our revenue/maintenance budget and there are many competing priorities for capital monies.

“The government funding settlement for 2011–12 was for one year only, so we have to be prudent in planning further ahead than that and assume that centralised funding allocations could fall further. With that in mind, the council’s priorities will remain providing services for the most vulnerable. We’re working as efficiently as possible in order to maximise the resources available for all our services.”

This is where the modern, complicated style of land-ownership and management comes into play, as maintenance of the path in the glen relates to a funding submission made by the Ochils Landscape Partnership. (The OLP website is offline at the time of writing, having been hacked; a new one is in the process of being developed at Stirling University.)

The OLP has a total budget of £2.2 million, which comprises £631,500 from the Heritage Lottery Fund, £670,000 from Wind Prospect (the company which last year installed the controversial windfarm on the northern side of the Ochils and which is now looking to expand the site), £50,000 from the Clackmannanshire and Stirling Environment Trust and £5,000 from the Clackmannanshire Heritage Trust. “The balance [£843,500] is currently being sourced from other organisations,” Dean said.

The situation, if not quite stalled, looks like it could persist for some time. “The glen is still closed,” Dean said in late May (and this was still the case on 20 June, when the accompanying photograph was taken), “and will remain so until we find the funding to repair the path so that it is safe to use.”

Initial hopes from walkers that the glen might be closed for only a few weeks have already proved to be over-optimistic. It isn’t a massive problem (indeed, this is perhaps part of why it’s taking time to resolve – something of higher priority would have been fixed by now), but it is a nuisance both for visiting hillwalkers and those in the village who like to take a regular stroll along the glen for a bit of peace, quiet and exercise.

There is also the risk that the longer things stay like this, the more people will just say Sod it! and walk along the glen anyway – it isn’t blocked off by a metal fence, merely by a chain with a notice on it. Some anti-authority walkers will walk straight past such things, on the red rag / bull principle, and for them it’s a case of taking their chances. More worrying is that someone – perhaps a frustrated local who has genuinely lost patience – could walk along at just the moment that either the rock pillar or the bridge collapses.

There is also the problem of someone entering the Mill Glen from the side having started from elsewhere – feasible given that a popular alternative route off Ben Cleuch does just that, meeting the glen two-thirds of the way along.

A third potential problem comes from people erring too much on the side of caution. This was much in evidence a decade ago at the end of the foot and mouth crisis, when quite a few walkers decided to “wait until 2002” before venturing out anywhere, even though councils and other authorities were strenuously sounding the all-clear in most places throughout the latter half of 2001. The equivalent, in the current local situation at Tillicoultry, was shown by a woman met halfway up the Law who was sheepish about being seen there, having wrongly interpreted the glen-closure notice to mean that the entire route up to Ben Cleuch was out of bounds.

For now – with the initial 12-month hope from March 2010 already a thing of the past – it seems to be a case of waiting for the money to somehow come together, the engineering assessments to then be made and the work to be done. “We regret the inconvenience to users,” Martin Dean says, “but I’m sure you understand that safety is our first priority.”

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