Written evidence submitted by Sue Ryder
Sue Ryder is a charitable provider of health and
social care services across the UK. We care for people with long
term or complex conditions and disabilities. We operate in a range
of environments with community and home-based care delivery alongside
our hospices and neurological care centres. Last year we provided
4 million hours of care and delivered 1.2 million home visits.
We work closely with PCTs, local authorities and
local communities in the delivery of care. This makes us uniquely
placed to comment on the interface between health and social care
as a provider of both across the care continuum.
With a 9,000 strong volunteer workforce, we believe
we are part of the government's "Big Society". We look
forward to seeing greater policy definition and tangible examples
of best practice from charities the size of Sue Ryder.
Most of the focus of the Big Society thus far has
concentrated on community empowerment and social action. Until
we know what kind of funding and structures will be available
for the public service reform agenda, it will be challenging to
embed the Big Society across the board. We are therefore disappointed
by the delays to the publication of the public service reform
white paper, as this will add much needed "meat to the bones".
Below we have addressed the most relevant questions
raised by the Committee.
A definition of what the "Big Society"
is or should be
We have examined the government's definition of the
"Big Society" which presents their vision for the policy.
In this evidence paper we have chosen not to deviate too far from
their definition. We are conscious of "mission creep"
in this area resulting from the different interpretations of the
definition already in circulation. We have, however, outlined
the components we believe should be contained within the government's
definition and key themes.
The government's definition of the Big Society is
centred on three themes; community empowerment, opening up public
services and social action.
While we welcome the opportunity to include local
people in making decisions about the shape of their area, we want
to ensure the whole community, including the hard to reach and
vulnerable, are listened to and not just those who shout the loudest.
This cannot be achieved without time and financial investment
from the local body seeking views.
Sue Ryder works with hard to reach and vulnerable
individuals with health and social care needs. We strive to find
innovative ways of canvassing their opinions through a selection
of mediums. For example, we recognise that not all individuals
are able to complete our annual survey so we provide volunteers
to assist our service users and ensure their voices are still
heard. We are then able to tailor and adapt our services accordingly.
Though volunteers are used for this task, they need
support and coordination from a paid workforce. We are unsure
the government and local bodies have considered this added cost
of meaningful local engagement.
Opening Up Public Services
We welcome the opportunity for charities to tender
for, and ultimately deliver a greater volume of public services.
Charities such as Sue Ryder invest in the services we provide
ensuring that the care is high in quality, innovative and cost
We are yet to see detailed information on what the
reform of public service delivery will mean in practice to the
Big Society. However, it is our belief that the two agendas are,
indeed, heavily entwined. As such, it is important that there
are no barriers to the involvement of charities in public service
Since January 2011 Sue Ryder has been running a campaign
on irrecoverable VAT for charities. The campaign centres on the
inequity of the NHS being able to recover VAT on certain non business
supplies (including catering, laundry, waste disposal), while
charities providing the same services are not. This means that
when services are transferred from the NHS into the charity sector
there is an immediate "VAT gap".
We know that this issue will become more pronounced
as the government's agenda gains pace and more services are transferred
from the state to the charity sector.
There are two ways of filling the "VAT gap":
commissioning authority (PCTs now, and GP Consortia in the future)
could agree to allow extra funding in the agreement to fill the
"VAT gap". However, this practice will never become
widespread as it would simply discourage commissioning authorities
from purchasing services from charities.
could use donated funds to plug the "VAT gap". However,
when people donate to a charity such as Sue Ryder, they do so
for their money to go towards or to support the delivery of care.
They do not envisage these funds ending up with the Treasury in
Under both of these options the Treasury will receive
increased irrecoverable VAT payments as a result of the transfer
of the services. This is an unintended consequence of the Big
Society, NHS and public service reform agendas.
Irrecoverable VAT affects all of Sue Ryder's services.
If our hospices and care centres were run by the NHS, they would
be able to recover a significant proportion of the VAT incurred
on non business supplies. For example, if our Cheltenham hospice,
Leckhampton Court, was run by the NHS it would be able to recover
approximately 57% of the £44,000 VAT incurred in this area
These funds would allow the hospice to:
a nurse for around 44 weeks or;
1,500 bereavement sessions for families who have lost a loved
2,500 hours of support from a carer.
We understand that it is not realistic to ask the
government to give charities the ability to recover all VAT in
the current economic climate. We hope that in the future they
will look to create discrete VAT recovery schemes. Our current
campaign simply calls for the government to ensure that services
transferred to charities in the future, as a result of the government's
agenda will be able to recover the same VAT on non business supplies
as the NHS.
The Government can stop this situation from worsening
by amending section 41 of the 1994 VAT Act, bringing charities
providing healthcare services and the NHS onto a level playing
field in relation to VAT recovery.
Our proposal can apply to all services transferred
from the NHS to the charity sector after the date of the legislation's
amendment. This would mean that the Treasury would not lose out
on funds they currently receive; they would maintain the existing
position in relation to VAT recovery on health services.
We believe this is a simple and discrete solution
to a problem faced directly as a result of the government's agenda.
It is similar to the government's amendment to Section 33 of the
1994 VAT Act to allow academy schools the same VAT recovery as
We agree that social action is important in encouraging
a big society. Again, we are not confident that this has been
"costed" and we believe that significant time and financial
investment will be needed in order to ensure that the most vulnerable
are able to play an active part in society.
We believe that fair funding is critical to ensuring
the big society vision is delivered. We would add this to the
government's key themes. As it stands, we believe issues such
as the VAT burden which we have highlighted will act as a barrier
to the vision.
Charities often subsidise the services they provide.
A good example of this can be seen in the hospice sector where
Sue Ryder funds on average over half of all activities. However,
there must a careful delineation between what the state provides
and what charities are expected to provide. At the moment this
line does not seem clear and the rhetoric from the government
instead focuses on charities "taking on what they can"
in light of public spending cuts. This is not sustainable, nor
is it likely to encourage public confidence in the government
or the charity sector.
The role and capacity for the voluntary and community
sector to deliver local public services including appropriateness
of using charitable income or volunteer labour to subsidise costs
As mentioned above, the hospice sector already heavily
subsidises the services it provides. This should not be viewed
as a model for future charitable service delivery. Fundamental
questions need to be asked in relation to charities subsidising
public service costs.
The palliative care funding review is looking at
some of these questions for our sector. It is currently running
a questionnaire to ascertain which hospice provided services should
be provided by the state, society or individuals.
This model and consultative approach could be replicated
by the government on a wider scale when looking to inform its
thinking around public services' funding.
It is critical that this issue is examined with care.
We are currently seeing a broad-brush approach to cutting services,
with those that could be deemed "life enhancing" such
as day care or bereavement services, being cut disproportionately.
These services are often provided and funded by charities. However,
the government must not lose sight of their importance. In addition
to meeting an immediate need, ie the need for bereavement care
after a relative has died, they can also be seen as preventative,
stopping someone from needing intensive support at a greater expense
down the line.
We believe there are barriers to the government's
current Big Society vision. These include:
policy definition which leads to "mission creep" and
a lack of momentum behind meaningful reform.
of clarity about what services the charity sector is expected
to fund. It is still unclear the extent to which the government's
vision and it's expansion is based on political ideology or necessity
as a result of reductions in public spending.
to the creation of a level playing field for charities such as
the VAT issue raised above.
We would be happy to provide you with more information
on any element of this briefing, either in writing or through
an oral evidence session.