Circular No: SW19/1995

Previous Circular

cancelled/amended: none

21 November 1995

Directors of Social Work

Chief Executives, New Unitary Authorities

Copy to: Chief Executives of Regional and Island Councils

General Managers, Health Boards

Directors Relevant Independent Organisations

Dear Sir/Madam

NATIONAL HEALTH SERVICE AND COMMUNITY CARE ACT 1990:

MENTAL ILLNESS SPECIFIC REVENUE GRANT (MISG)

Summary

1. This Circular invites the new unitary authorities to submit applications for the revenue grant assistance in respect of community care projects in the mental illness field during 1996-97. These authorities may wish to seek the assistance of existing authorities in preparing and submitting applications. Existing authorities are invited to provide assistance.

Background

2. Mental Illness Specific Grant was introduced in 1991 with the aim of developing services in the community to support people with a mental illness. It is now a substantial source of extra resources, supporting some £18 million worth of projects in 1995-96.

Aims

3. Circular SW9/1994 emphasised the importance of relating services supported by the Grant to the reduction in places in psychiatric hospitals. That continues to be a priority. MISG is an important source funding associated with hospital closure. Others are bridging finance and resource transfer. Bridging finance provides resources to health boards to cope with the double running costs of hospitals which are planned to close. Its availability recognises that the costs of running hospital services do not reduce evenly with the discharge of patients. Resource transfers are made to local authorities by the NHS in conjunction with the transfer of responsibility for the provision of a service. Transfers of responsibility should always be accompanied by resource transfers; in some cases the arrangements may warrant

the support of bridging finance; and in some cases the creation of new services in the community may be appropriately supported by MISG. All 3 sources of finance should, of course, only be sought following agreement between local agencies.

Local Government Reform

4. Responses to David Bruce’s letter of 6 June indicated that most projects which are currently supported by authorities provide services within a geographical area covered by one of the new authorities. A few provide services to clients in areas which will be the responsibility of more than one new authority. However, authorities are making arrangements to continue support for the latter type by seeking the agreement of the new authorities to jointly fund good projects. This may involve several authorities contracting for services from one authority which is responsible for a project. The decision on whether to fund all projects will be a matter for new authorities but given the practicalities we expect existing authorities to take the major role in arranging for transfer and dissagregation of responsibilities.

5. A major consideration for 1996-97 must be to ensure the smooth transition of support for good projects from the existing to the new authorities. However, the need for stability should not override the need to ensure that continuation of each project is justified.

6. Responses also indicated that while in many authorities distribution of the grant on the basis of population would allow good existing projects to continue, in others there could be serious disruption to services. We do not consider that the new authorities which would lose by distribution on the basis of population will yet be in a position to reach a view on whether resources can be transferred to make good potential losses of services and projects for the mentally ill. There could also be problems for new authorities which would gain by such distribution in quickly developing and supporting new projects.

7. In view of these considerations, new authorities should plan on the basis that grant for 1996-97 will remain at the 1995-96 level of 70% of total expenditure of £18 million. Distribution to the new authorities will be on the basis of the disposition of supported projects in 1995-96. Where grant resources are released as a result of changes in the nature of funding arrangements of a project it will be for the responsible authority to make proposals on how the grant resources should be used. That could involve release of grant for use by another authority. Care managers should increasingly be purchasing services from projects which have been grant aided. This releases funds to develop projects and encourages care managers to seek value for money.

Independent Sector Involvement

8. We are pleased to note that around two-thirds of projects continue to be managed by voluntary organisations. It is important that authorities maintain this involvement by ensuring an adequate flow of information between authorities and independent sector organisations at all stages, i.e. in planning, when developing projects, in feedback on progress of applications and on the reasons in cases where authorities decide not to take up independent sector proposals for submission to the Secretary of State. Authorities can also help organisations by providing a priorities list at the beginning of the application process and by flexible financial arrangements, including advance payments.

9. It has been suggested that funding uncertainties at the project level often lead to voluntary organisation over-bidding in the first financial year of a project on costs subject to inflationary pressures eg salaries. The rationale being that second and subsequent year increases would, in the worst scenario, already be addressed. Authorities should provide clear advice in these areas to prevent such over-bidding.

10. Authorities are reminded that Part II of the Local Government Act 1988 stipulates that they may not specify non-commercial considerations in contracts. Non-commercial considerations as defined in section 17 (5) of the Act are set out in the appendix.

Applications for 1996-97

11. Application forms for revenue grant are at Annex A, and notes on completing the revenue grant forms are at Annex B. Completed forms should be received here no later than 15 January 1996. As in 1995-96, Form A asks for a list of projects from each authority and only where an application is in respect of a new or substantially revised project will Form B be required. Existing authorities should ensure that the total of project expenditure of "their" new authorities is consistent with the following allocation.

They are also asked to provide a statement of the total expenditure of each of "their" new authorities and show how this relates to the above totals.

12. It is important that the projects proposed for grant should be seen as part of the wider development of services. We therefore require authorities to show how their projects relate to their community care plans.

13. Proposals should be the subject of full consultation with all interested parties in the independent and statutory sectors (although consultation will not necessarily secure agreement). Information should therefore be provided of the extent to which the authority’s strategy on mental health services generally has proved acceptable to consultees and whether the individual projects are agreed by them; disagreements by interested parties should be noted in all final proposals. All programmes submitted should be agreed with health boards. This requires that senior health board planning staff countersign Form A (Item 7). Where there has been consultation on individual proposals with health boards and/or housing authorities, Form B should be countersigned by the relevant staff (Item 5).

14. Applications may be submitted by the new authorities, or by existing authorities provided that the proposals are supported by the relevant new authority. In such cases the application must include a statement of support signed by an official of the ‘new’ authority.

Income

15. Authorities are reminded that the basis of the grant is a central government contribution of 70% and a local government contribution of 30%. When income from clients or other sources reduces net expenditure on grant supported projects, net central to local Government expenditure must remain in the ratio 70:30. Thus where there is income which has not been allowed for in a grant application, that income should be used to reduce both the central Government contribution (70%) and the local Government contribution (30%); alternatively, it may be used to increase the services offered by the project if the project description remains consistent with the application approved by the Minister.

Future of Mental Illness Specific Grant

16. The future of the scheme will be reviewed in 1996 following a full study of its operation and effectiveness, which will report later this year. It is likely that the scheme will continue at least during 1997-98.

Further Information

17. Any questions on this Circular or requests for further information should be addressed to Fraser Stewart at the above address, telephone: 0131 244 5460. [ To holders of the SWSG Circulars and Guidance Package : - This circular should be placed in Section F.13 of the volume containing "F. Community Care (Sections 11-20)" circulars]

Yours faithfully

GAVIN ANDERSON JOHN ALDRIDGE

APPENDIX

Section 17(5), Part II, Local Government Act 1988

The following matters are non-commercial matters as regards the public supply or works contracts of a public authority, any proposed or any subsisting such contract, as the case may be, that is to say -

(a) the terms and conditions of employment by contractors of their workers or the composition of, the arrangements for the promotion, transfer or training of or the other opportunities afforded to, their workforces;

(b) whether the terms on which contractors contract with their sub-contractors constitute , in the case of contracts with individuals, contracts for the provision by them as self employed persons of their services only;

(c) any involvement of the business activities or interests of contractors with irrelevant fields of Government policy;

(d) the conduct of contractors or workers in industrial disputes between them or any involvement of the business activities of contractors in industrial disputes between other persons;

(e) the country or territory of origin of supplies to, or the location in any country or territory of the business activities or interests of contractors;

(f) any political, industrial or sectarian affiliations or interests of contractors or their directors, partners or employees;

(g) financial support or lack of financial support by constructors for any institution to or from which the authority gives or withholds support;

(h) use or non-use by contractors of technical or professional services provided by the authority under the Building Act 1984 or the Building (Scotland) Act 1959.

ANNEX A

MENTAL ILLNESS SPECIFIC GRANT APPLICATION 1996-97

FORM A: GENERAL

1. AREA SERVED - Geographical

Population

2. WHAT ASSESSMENT OF NEED HAS BEEN MADE FOR THIS AREA?

3. WHICH VOLUNTARY, PRIVATE AND STATUTORY ORGANISATIONS WERE CONSULTED ABOUT THIS PACKAGE OF PROPOSALS AND HOW?

4. HOW DID EACH CONSULTEE RESPOND?

5. BRIEF DESCRIPTION OF YOUR PACKAGE OF PROPOSALS (include details of projects for which grant is sought and their relationship, if any, to each other. Say how projects will assist in meeting the aims of paragraph 2 of SW10/1990, how they will address the specific problems identified in the area, how they combine with Bridging Finance to facilitate the closure of institution-based NHS care and how they relate to the community care plan.)

FORM A ITEM 6

LIST OF PROJECTS

Start 1991-92

Start 1992-93

Start 1993-94

Start 1995-96

Start 1996-97

* Estimate of grant outturn in 1995-96 prepared by .....................................

Date .....................................

Existing authorities should ensure that the total of project expenditure of "their" new authorities is consistent with the allocation detailed in circular SW19/1995.

New authorities should ensure that the dissagregation of projects to their areas has been properly achieved and that their expenditure together with that of ajoining areas which formed a previous authority equates with the allocation detailed in circular SW19/1995.

FORM A ITEM 7

CERTIFICATION OF HEALTH BOARD INVOLVEMENT IN MENTAL ILLNESS SPECIFIC GRANT

I confirm that my health board has been fully involved in developing the programme of projects and supports all the projects in which my board is directly participating.

Signature ................................................. Signature .................................................

Position ................................................. Position .................................................

Health Board ................................................. Health Board .................................................

Signature ................................................ Signature .................................................

Position ................................................. Position .................................................

Health Board ................................................. Health Board .................................................

Signature ................................................. Signature .................................................

Position ................................................. Position .................................................

Health Board ................................................. Health Board .................................................

Signature ................................................. Signature .................................................

Position ................................................ Position ................................................

Health Board ................................................. Health Board .................................................

MENTAL ILLNESS SPECIFIC GRANT APPLICATION 1996-97

AUTHORITY .....................................

FORM B: INDIVIDUAL PROJECT

1. Name of project

2. Location of project

3. Managing Agency

4. Contact for information

5. Consultation with :

Result

I confirm the above is accurate in relation to my health board/housing agency

6a. Independent sector involvement

6b. Has each agency received a copy of this application?

7. AREA SERVED - Geographical (including authority district)

Population

8. TYPE OF PROJECT -

9. FUNCTIONS -

Description

10. USER GROUPS TARGETED

11. NUMBERS AND GRADES OF STAFF :

Authorities

Health Boards

Voluntary Agencies

Private Agencies

Others

12. NUMBER OF PAID STAFF

13. NUMBER AND ROLE OF VOLUNTEERS

14. ROLE OF USERS

15. MANAGEMENT

16. ACCOMMODATION - NATURE AND AVAILABILITY

17. PROPOSED OUTCOMES INCLUDING NUMBER OF PEOPLE TO BE HELPED

18. MONITORING ARRANGEMENTS

19. AMOUNT OF SPECIFIC GRANT REQUESTED

20. COSTS OF PROJECTS QUALIFYING FOR SPECIFIC GRANT

21. TOTAL NON-RECURRING COSTS CONTAINED IN 20

22. APPROXIMATE VALUE OF CONTRIBUTIONS ADDITIONAL TO 20 (EG STAFFING, PROPERTY, ECT)

23. AUTHORITY COSTS QUALIFYING FOR SPECIFIC GRANT

24. TOTAL VALUE OF PROJECT

(including that paid for by

other sources eg DSS grants)

- Health Board

- Voluntary sector staff

- Other staff

- Accommodation costs

- Other revenue costs

- Total Authority costs

qualifying for grant

(detailed at Question 23)

________

Total ________

25. INCOME (EG DSS PAYMENTS)

ANNEX B

MENTAL ILLNESS SPECIFIC GRANT

NOTES ON COMPLETING THE FORM

General Points

1. A description of the kind of projects to which the grants scheme will apply and a note of the criteria which must be met if projects are to attract grant is provided in Circulars SW10/1990 and SW13/1991. Projects may be submitted on an individual and free-standing basis or in groups where collectively they will improve the availability of services a particular area. Either way the application should explain the extent to which an assessment of need for the area has been made, the degree of inter-agency co-operation in drawing up projects, and the way in which the proposed projects will, along with existing facilities, address the service requirements identified. It should explain how the grant is linked to Bridging Finance to facilitate the closure of institutional-based NHS care.

2. Independent Sector organisations should be fully consulted on the projects submitted to the Secretary of State by authorities and should receive a copy of the applications as submitted. Authorities should enter contracts which give providing organisations long-term stability subject, of course, to meeting their performance criteria.

3. Applications for grant will involve the use of 2 separate forms, copies of which are attached. Form A requires an indication to be given of the strategy to be followed in meeting the need for community care services in this field as well as a list of projects.

4. Form B is project specific and allows freedom to offer as much information as is considered necessary to describe the project; the numbered sequence should, however, be followed and the item given the heading shown.

Particular Sections of Form B

5. Name and Location of Project (Items 1 and 2): The name should be unique to enable the project to be easily identified and any reference number used by the authority should be included. The location may be specific where it is known or simply a district where accommodation has yet to be found.

6. Consultation (Item 5): Please state the extent to which agencies agree with, and will participate in , the project. State whether the agreement is one in principle or represents a firm commitment. Please also secure consultee signatures at this item.

7. Type of Project (Item 8): If possible only one box should be ticked.

8. Functions (Item 9): Insofar as a project might involve more than one activity a number of boxes may require to be ticked. Please provide a description of the project and the services or facilities which it will provide. If it is an extension of an existing project explain what new or additional services will be provided.

9. Staffing (Item 11): Full details should be given of all the staff involved, including designation and grades. It may be necessary to show separately staff who salaries will be met by the authority through the Health Board, the independent sector or other agencies. Mention should be made of likely numbers and volunteers.

10. Role of Users (Item 14): Indicate what part the users will take in the project, eg participating in the managing committee.

11. Management (Item 15): In co-operative or jointly run projects the management arrangements may be complex. It is important that there should be proper lines of accountability and responsibility. Please say who will be responsible for the oversight of the project and its successful implementation.

12. Accommodation (Item 16): Say whether suitable accommodation has been identified and whether it is available. Are resources available to meet any costs involved/ Will any refurbishment or other modifications which might be necessary jeopardise the start or running of the project?

13. Proposed Outcomes and Monitoring (Items 17 and 18): The aims of projects should be clearly identified from the start and measurable outcome stated. Numbers of persons expected to receive the service provided by the project should be given. Increases in service provision should be measurable in terms of numbers, length of time, etc. Other indicators such as reductions in hospital admissions, reductions in the length of stay in hospital, the increase in numbers of people supported at home and in the number of people able to secure employment should also be mentioned, where possible, although the extent to which these figures have been influenced by the grant alone might be difficult to measure. Similarly it might be possible to measure changes experienced by individuals in independent living and social functioning. Brief details should be given of the arrangements which will be made to monitor the project.

14. Financial Details (Items 19-25): The grant meets a maximum of 70% of the authority’s revenue expenditure on the project. Contributions may be made from other quarters, eg the Health Board or voluntary agencies, but only the authority expenditure will qualify for grant. Item 20 covers the cost of the project which is to be met by the authority and which therefore qualifies for grant. Item 22 is to enable expenditure to be shown which does not qualify for grant or where contributions are made in kind - eg through the provision of staffing or free accommodation. Items 23 and 24 allow further information to be given and Item 25 requires estimated income to be stated.

Grant in Second and Subsequent Years

15. In order to minimise the amount of work necessary once projects have been approved for grant, subsequent applications where no substantial changes are proposed should be included in item 6 on Form A. If major alterations to the project are involved Form B should also be completed. Particular care should be taken to notify any changes in the financial structure, eg through income generated from other sources etc.