News / Christmas grant scheme facing 73 per cent cut
TRUSTEES of Shetland Charitable Trust (SCT) are being asked to drastically reduce spending on its Christmas grant scheme for pensioners and disabled people to just over a quarter of its current level.
However SCT chairman Bobby Hunter stressed that it was “not being done as a cost-saving exercise” and offered an assurance that the trust would examine how the leftover funds could be spent on helping some of the islands’ working poor.
The proposal will be considered at a meeting to set the £220 million charity’s budget for 2014/15 on Thursday.
In 2013/14 an estimated 864 pensioners and 329 disabled people received the £300 grant, at a total cost of £375,900 to the trust.
A review commissioned in June 2013 has concluded that the grant scheme “in its present form is difficult to administer and does not fully target those most in need in the community”.
SCT chief executive Ann Black is recommending that only £100,000 should be set aside for the next 12 months – equating to a 73 per cent reduction on last year.
In the wake of huge cuts and changes to UK welfare and benefits, the trust argues that many of those in greatest need are working age people.
“We’re trying to target the genuine needy folk,” Hunter told Shetland News. “We will be looking at what to do with the rest of the money.”
He added that the detail of any new scheme was “entirely up to the trustees to decide upon”.
The yuletide grant has been paid out to pensioners since the trust’s inception in 1976, later being expanded to include disabled people, and the cost at one stage exceeded £1 million.
In 2009 the trust began means-testing the grant to avoid a hefty tax bill after the Inland Revenue ruled that grants paid to well off pensioners could not be deemed charitable.
Continuing with the scheme in its existing form would cost around £362,000 next year.
But Black instead recommends that trustees should agree a budget of only £100,000. That would be used “to assist the most vulnerable individuals” currently receiving the yearly payment.
“The operational details of the scheme would need to be worked out between the trust and the SIC,” she writes, “but it is envisaged that funding would be disbursed to social work, and they would be responsible for administering the scheme.”
A third option, removing the entire budget, is also included in Black’s report.
The scheme currently costs £3,000 a year to administer, attracting an annual tax bill of £15,000.
Councillor and SCT trustee Allison Duncan has been one of the scheme’s most vocal supporters in recent years. Back in 2008 he fought unsuccessfully to increase the grant to £500 to compensate for rising fuel prices.
But he now feels the position is a “difficult one” and it might make more sense to direct money towards people of working age who find themselves in poverty.
Duncan pointed out that the Salvation Army has seen a major increase in demand for food parcels. He also suggested some of the money could be used for insulation to help working people reduce their electricity bills.
“Obviously there’s an element of poverty in Shetland,” Duncan added, “and if younger families with low income require help I would be all for that.”
Most organisations funded by SCT, including the amenity, arts and recreational trusts, are set to receive a “standstill” budget for the third successive year.
In 2012 the trust agreed that annual spending over a three year period should not exceed £11 million.
Depending on which Christmas grant option trustees opt for, the 2014/15 budget will total somewhere between £9.94 million and £10.3 million.
Nearly £2.5 million will go on supporting rural care homes, while Shetland Recreational Trust is to get £2.52 million, Shetland Arts £696,000 and Shetland Amenity Trust £1.05 million.
Maintenance of buildings will total around £1.77 million, a rise of more than 10 per cent on last year. Management and administration costs are in line to be reduced from £540,000 to £509,000.
There is an expectation among the major SCT-funded trusts that, once the three year funding agreement ends, cuts of 10-15 per cent, or perhaps even greater, may be ushered in.
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