Local funding reforms put early intervention projects at risk

The government plans to give councils area-based grants that will replace smaller ringfenced grants for specific services such as preventive work and children's mental health services.

Barbara Atkinson, programme manager of Enfield Children's Fund in London, said she was concerned funding could slip away from early intervention projects into other more immediate areas of concern.

"The money that exists for preventive work is going to become un-ringfenced," she said. "That is worrying because there is already too little incentive for spending on prevention."

Steve Beynon, chair of the Association of Directors of Children's Services' educational achievement committee, said it was vital that local authorities ensure the area-based grant is still used for preventive work.

"Where there is a good children's plan and an effective trust working with health organisations and the police, this should deliver the goods," he said.

But Beynon is concerned the amount of funding could diminish over time. "The total is not always the sum of the parts contributing to it," he said.

A new Working Neighbourhoods Fund, which replaces the Neighbourhood Renewal Fund (NRF), will also be part of the councils' area-based grant. A total of £1.5bn will be allocated over the next three years for projects to get people into work.

But the new fund does not address the problem of low-income families, who can experience greater poverty than families where no one works, said Beynon. "We might not be tackling the greatest need, particularly in rural areas," he said.

Stephen Lord, director of local government finance at London Councils, said the changes to the NRF could have a negative impact on child poverty in London. "Rich and poor live side by side in the capital so vulnerable people may not show up on the deprivation index and lose out," he said.