Examination of Witnesses (Quesitons 40-59)
DEPARTMENT FOR
CULTURE, MEDIA
AND SPORT,
SPORT ENGLAND,
ENGLISH HERITAGE,
ARTS COUNCIL
AND BIG
LOTTERY FUND
MONDAY 2 JUNE
2008
Q40 Mr Touhig: In any of your organisations,
do you have any other proposals for radically simplifying the
application process other than going online?
Mr Davey: We have recently simplified
the application form and subjected it to extensive user testing.
What I want to do in the next year or so is to look at how we
can reduce our Lottery administration costs by 15%. We will be
looking at our application schemes to see how we can simplify
them.
Ms Price: We are also introducing
a single online application form for all of our grant programmes
in September, so that will reduce the burden.
Q41 Mr Touhig: Is it possible that
we could have a note before we complete our report on what each
department is doing?[1]
Mr Holgate: Certainly, Mr Touhig.
Q42 Mr Touhig: That would be helpful.
One of the cancer charities had a mission statement, it might
be a mission statement, or it might be a slogan, "Get it
spent where it's meant", very simple but it gets the message
across. Perhaps that is something all of you could be looking
at.
Mr Holgate: These schemes all
have quite specific objectives. The only problem with having specific
objectives is that sometimes people apply who do not fit into
that projection so solving one thing can lead to one of the other
issues that you have mentioned.
Q43 Mr Touhig: Why is it that you
require the Lottery Forum to publish its admin costs when you
do not require the same information from the Exchequer funded
grant-makers? All taxpayers want to know they are getting value
for money, not just Lottery payers.
Mr Holgate: I think the answer
to that is wherever there is a major Lottery distributor, it has
a large volume of business, unlike English Heritage where its
grant-making is only a small proportion of its business. There
is a case for accountability of a relatively crude nature for
the Lottery distributors which I do not think there is across
the generality of our bodies where grant-making may not be the
principal source of engagement.
Q44 Mr Touhig: You do not think perhaps
knowing the admin costs of all the others would be helpful?
Mr Holgate: I think that brings
us back to the point where the Chairman began which is the problem
of not quite comparing like-with-like. The NAO did a valiant job
getting figures which do appear broadly comparable, but they are
only comparable to the extent that they are pence per pound of
grant, they are not pence per pound of effective grant. As the
NAO rightly point out, they have not been able to investigate
the relative effectiveness, so the true ratio is missing a really
compelling denominator.
Q45 Mr Touhig: Mr Davey, in 2006-07
80% of the grants made under the Arts Council's individual programme
were for £5,000 or less and it cost you £2,000 on average
to administer. That is about 40% of the grant value going on costs
in eight out of 10 cases. That is not really value for money,
is it?
Mr Davey: If I refer to my previous
answer, much of the work around Grants for the Arts for Individuals
is working with the applicant to work up the application and work
up what the scope of the application would be. For example, with
a choreographer, the Arts Council officer might work up with them
what kind of application would be likely to succeed and work with
them as to what their artistic—
Q46 Mr Touhig: Forgive me, I am short
of time, but you did explain that in answer to the Chairman. The
point I am making is if you have a particular project that gives
grants on average of about £5,000 and it is costing you £2,000
to administer then you ought to be looking at the project as a
whole as to whether it is value for money at all.
Mr Davey: The clients who are
successful regard the development work as being valuable. Yes,
I do agree that we need to look at it to see if we can get those
costs down.
Q47 Mr Touhig: A final question for
Mr Wanless. What is happening with applications for Lottery funding
now that the 2012 Olympics have taken so much of your money? The
Friends of the Newbridge Memo, in my constituency, built by miners
in memory of those who died in the First World War, need £4.9
million to rejuvenate and use the building. Are they going to
get the money?
Mr Wanless: To some extent it
depends on the quality of their application! Seriously, we are
going to enter into a tighter budget in the period ahead now because
there will be less money available per year for the next period.
Q48 Mr Touhig: I asked Mr Stephens
when he came before us, the Permanent Secretary of the Department,
about what the Lottery Fund was doing to find extra money as a
result of the £2.1 billion that has now been transferred
to Olympic Costs. What are you doing to raise extra funds?
Mr Wanless: It is not my job,
I am afraid.
Q49 Mr Touhig: I appreciate that,
you administer it in terms of the distribution but surely you
have an input in terms of passing back information to those who
do raise the necessary funds.
Mr Wanless: Our role is simply
to administer as best we can whatever money is given to us.
Q50 Mr Touhig: So you do not have
any view or have not put forward any suggestions about how more
money could be raised?
Mr Wanless: That is for others
to determine. We are obviously keen to administer as much as we
possibly can.
Mr Touhig: Heads in the clouds, is it
not?
Q51 Mr Burstow: I want to come back
to the issue of forms and a simple way of how to fill them in
and the answer that Mr Wanless has given already. You say that
the form has been simplified now the new guidance has been issued,
but do you really think that is enough given that, certainly before
you did that, 50% of people were not filling in your forms completely?
What are the steps you have taken to try and address that huge
number of objections?
Mr Wanless: I do not think it
is enough. Every opportunity we can take to ram home to people
the basic pieces of information that are required to enable an
application to be successful we should take. We have a dedicated
telephone helpline number available. We have a dedicated website.
As I say, we have sharpened up the guidance. It makes it absolutely
clear, point one and point two, "Read the guidance notes,
make sure you attach the documents. These are things which are
required for basic propriety/fraud purposes". Beyond that
I think the real answer is this online application change which,
as we have seen from other programmes where we have run that kind
of approach, will make a very big difference.
Q52 Mr Burstow: Taking that online
portal for applications for fraud, is that simply going to be
something that will be available in one place for lottery applications
or is that something that you and others across the grant-making
sector have been discussing to see whether or not there can be
a single portal as there is in the States?
Mr Wanless: When we researched
our online capability, which is referred to in the report as the
Business Process Re-engineering Project, we went out and we looked
at the Arts Council system, the Heritage Lottery Fund, Esme Fairburn,
Wellcome Trust, the Gates Foundation. We also looked at retail
banking sector parallels to try and establish what were the very
best possible online processes. We are looking to develop a modular
system and it could very well be that modules from what we are
seeking to develop would be of application and interest to other
distributors, lottery and non-lottery, and we are very happy to
explore that further in those conversations.
Q53 Mr Burstow: Is this something
where it would make more sense and would be more readily understandable
for members of the public and those who want to make applications
to the various grants that are represented here for them to have
one place they knew they could to make that point of entry to
the system? I can see Mr Davey nodding in some support for your
comments.
Mr Davey: We already have the
common lottery website which directs people to the right place.
In the case of the arts, if you are a choreographer, a painter
or a writer you fairly clearly want to come to the Arts Council
programme and it is about which grant is the right avenue for
you to be exploring and you need to have conversations with someone
at the Arts Council to help you navigate through that, so I am
not quite clear what the total advantage to a potential applicant
might be, but if we can attach online applications to the National
Lottery website that would be a very great improvement. To return
to the US website that you cited, it is quite a portmanteau affair
with many thousands of grants and if you type in "theatre",
for example, you get lots and lots of military procurement programmes
which I think would possibly perplex artists if we were to have
such a scheme in this country. I think there is an advantage to
it but I am not sure it is an overwhelming advantage.
Q54 Mr Burstow: Let us move on to
Mr Holgate and ask a question about something which some of the
Committee have expressed disappointment about in the past, which
is this lack of back office facilities sharing among various organisations
to help drive down costs. Is that something where, as in this
NAO report, there looks likely to be any further progress? Why
has there not been any progress since the last time the Committee
drew attention to this obvious opportunity to save taxpayers'
money?
Mr Holgate: If by "the last
time" you meant the report on DCMS accommodation when I came
before the Committee about 18 months ago, I can assure you that
both in response to that and in response to the OGC's high performing
property initiative, all of what is represented here and several
others are trying to economise on their property holdings. The
Big Lottery Fund, for example, is making £3.5 million savings.
Q55 Mr Burstow: But in terms of taking
the idea that was inherent in that and applying it to this issue
of how the offices that run the grant systems within all of these
organisations can be better organised, and indeed in some cases
rationalised, is that something that is being done?
Mr Holgate: No, it is not something
that is being done. It is a possibility.
Q56 Mr Burstow: It is. It has been
suggested in this report and has been canvassed. Why is it still
only a possibility?
Mr Holgate: The problem is that
we need to learn to walk before we can run. The first recommendation
in the report is to compare on a segmented like-for-like basis—I
paraphrase—the costs incurred by the different grant givers.
If we can do that compellingly I think that builds the platform
for the next step, and it could be a step along the lines that
you are suggesting, but I do not think we can leap to a common
online platform or something like that on which everyone depends.
It is a different thing having an option of a site, which is what
Peter has described, from something on which the organisations
depend for the processing of their applications.
Q57 Mr Burstow: One other thing before
my time is up which I would suggest you reflect on is that it
is not just about the online presence and how that is organised
in a more unified way. It is the back office administrative aspects
as well.
Mr Holgate: Yes, I understand
that.
Q58 Mr Burstow: I hope that is being
looked at as well. I am, though, curious at the fact that there
does not seem to be—this is back to Mr Wanless again—any
real feeling for the amount of time that many people spend filling
in the grant application forms, the extraordinary amount of person
hours that are being invested in getting absolutely nowhere in
terms of getting grants that are successful. In response to Mr
Touhig you seemed to be really rather dismissive in the sense
that it is not the Big Lottery's fault that people are spending
so much time. Just what research are you doing to understand why
people are investing so much hope and energy and time on this
without the payback and what are you doing to try and change it
so that people understand that perhaps they should invest less
time and less hope in getting these grants in the first place?
Mr Wanless: I am sorry if I gave
the impression I was at all dismissive about the needs of applicants
coming forward for money because that absolutely was not my intention.
We put a lot of effort and time, particularly through our regional
outreach operations and a range of award partners, who can be
all sorts of people from voluntary sector organisations to functions
within local government, into getting out and about to help potential
applicants and applicants understand the process and what it means
to apply for our programmes and to maximise the likelihood of
their being successful. There is a major programme of outreach
workers, particularly—
Q59 Mr Burstow: But four out of five
are rejected.
Mr Wanless: We run across the
UK 80 programmes in Reaching Communities, which is our most open,
large-scale programme. It is the most highly competitive as a
result of that because so many things can come out of that heading
that it is the one with the greatest failure rate, and that is
an issue—
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