Government demands 'straight answers' over Birmingham jobs fund
Oct 30 2009 by Paul Dale, Birmingham Post
The Government moved swiftly yesterday to order an urgent inquiry into Birmingham’s failure to spend more than a small fraction of a £115 million fund to tackle unemployment in the city’s worst-hit areas.
West Midlands minister Ian Austin said he wanted “some straight answers” from the city council to explain why only a quarter of cash from the Working Neighbourhoods Fund (WNF) had been spent over an 18-month period – and only a tiny proportion of that went on projects to help people back into work.
Mr Austin decided to intervene after reading a Birmingham Post investigation earlier this week which revealed that the city strategic partnership, Be Birmingham, diverted £14 million from the WNF to bail out the city council’s overspending social services department.
Payments were also allocated to addressing climate change, reducing obesity, getting rid of graffiti and promoting cultural festivals.
The partnership organisation, consisting of senior figures from public and private sector organisations in Birmingham, admitted it could have done better.
Chief executive Jackie Mould refused to apologise, but accepted that Be Birmingham needed to learn lessons.
Mr Austin said he was “deeply concerned” that parts of Birmingham where unemployment is at 30 per cent and rising were not receiving the help they deserved quickly enough from Be Birmingham, which is led by the city council and chaired by deputy council leader Paul Tilsley.
Mr Austin (Lab, Dudley North) said: “I have asked my officials for an urgent report. I want the details. I want to know exactly what has been going on here.
“I was very concerned to read the Post investigation which showed that money given by the Government to boost skills and tackle unemployment in the city’s poorest communities is not being used for that purpose.”
Mr Austin said he would be particularly interested in an explanation about Be Birmingham’s decision to transfer cash to social services, where most of the money will be used to plug a gaping hole in the budget to care for adults with learning disabilities.
His officials are likely to consider whether the decision, denounced by Sparkbrook Liberal Democrat councillor Jerry Evans as a “smash and grab raid” on unemployed people, is within the rules laid down for the WNF by the Government.
Mr Austin added: “I think the people of Birmingham will want to know why the WNF money was not spent more quickly and why so much has been diverted to other projects.”
Mr Austin joins local government minister John Healey in expressing concern about Be Birmingham’s conduct.
Mr Healey, who met with Perry Barr MP Khalid Mahmood on Thursday to discuss the issue, has promised to investigate.
Mr Mahmood said: “He was very interested in what is going on in Birmingham and asked me to write formally to him, which I intend to do.”
