News / Big trusts facing SCT funding cut of one sixth
SHETLAND Charitable Trust has confirmed it is to cut the budgets of the three major trusts it funds – amenity, arts and recreational – and its contribution to rural care homes by 17.5 per cent apiece over the next five years.
The news follows a decision taken in private by trustees 12 days ago to gradually reduce its annual spending to £8.5 million between now and 2020.
Cuts will be phased in at a rate of around 4-5 per cent a year, meaning Shetland Recreational Trust will see its budget fall from £2.52 million to just over £2 million in four years’ time.
Shetland Arts will see its grant fall from £696,000 to around £574,000, while Shetland Amenity Trust’s share will be reduced from £1.05 million to around £866,000 come 2020.
The SCT’s contribution to SIC-run rural care homes will drop from £2.49 million to just over £2 million over the same time period.
Its £1.7 million planned maintenance scheme – funding upkeep of assets owned by the SRT, SAT and SA along with the Swan Trust and Voluntary Action Shetland – is to be closed in March 2016. A 25 per cent cut in 2015/16 is to be maintained and the funding will be bundled into revenue grants for the aforementioned organisations.
All of the cuts are indicative at this stage, with the budget for 2016/17 not due to be finalised until later this year.
Trust chairman Bobby Hunter told Shetland News he felt creating a sustainable budget was “a positive move to secure the trust for the long term future”.
It was agreed following a “measured” process involving lengthy discussions with the affected organisations, he said.
“I know it maybe sounds silly, but I think the decision to cut is actually a positive decision,” Hunter said. “Let’s look to the future, let’s have enough here for the next generation. If we spend all the money now, it’ll not be there.”
As revealed in these pages on Friday, the Swan Trust, Shetland Churches Council Trust, Shetland Folk Festival and the Accordion and Fiddle Festival are to have their entire funding gradually phased out over the next four years.
There has been criticism, including from Shetland MSP Tavish Scott, about a perceived lack of openness in the trust’s decision-making.
But Hunter said it had been important for affected organisations to hear about the cuts directly from general manager Ann Black before full details were released publicly.
Funding for several other organisations – Voluntary Action Shetland, Shetland Befriending Scheme, Shetland Islands Citizens Advice Bureau, COPE Ltd., Shetland Link Up, Royal Voluntary Service and Disability Shetland – will remain at a standstill until 2020.
That is also the case for the budgets paid towards the Senior Citizens Clubs scheme and Local Charitable Organisations scheme. There will be no further funding for the SIC’s community support grants scheme, which the local authority is proposing to end.
Criteria for accessing grants from the Shetland Arts Fund have been amended and it will now only fund activities undertaken by individuals under the age of 18. The budget will reduce from £35,000 to £15,000 over four years.
The trust is also working with the SIC to identify savings in a scheme for elderly and disable bus users.
Although the trust made huge gains of around £20 million on the stock market last year, its £8.5 million a year target budget does not factor in any growth in its investments in the coming years.
It is a notably a different approach to that of the SIC, which views a draw of £10 million a year as “sustainable” on its £200 million pot of investments. The local authority is budgeting for gains of around five per cent a year.
Trust vice-chairman Jonathan Wills said its investment assumptions were “always going to be more cautious and conservative than the council’s” because, if the council went bust, it could be bailed out by the government, whereas the trust would be left in financial ruin.
Hunter, meanwhile, said suggestions that the trust was seeking to build up cash to invest in its share of the Viking Energy (VE) windfarm project were simply untrue and he had “never even considered VE in this process”.
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