policy changes april 2004

There are three main changes that may affect your organisation or project.

The changes cover:

payment of costs towards statutory maternity, paternity, adoption and sick leave entitlement
payment of costs to cover statutory redundancy for projects that will end when our grant finishes
the introduction of tapering for all development applications – that is, further grants for the same project. (We explain what ‘tapering’ is below’.)

This document summarises the key points for each policy. If you would like to discuss your particular circumstances, please feel free to contact your local Community Fund office.

Maternity, paternity, adoption and sick leave payments

This applies to all new and existing grant holders.

All organisations employing staff should know their legal obligations concerning maternity, paternity, adoption and sick leave entitlements and payments, including the changes that came into force in April 2003. From 1 April 2004, Community Fund grant-holders can apply for an increase in their grant to cover the costs for these entitlements that they cannot recover from statutory sources.

Key points:

Payments will only be made for costs falling after 1 April 2004.
If we only fund part of the salary, we will generally only increase our grant to cover the proportion of the salary that we pay for.
Because many organisations have employment policies that provide for allowances more generous than the statutory level, we will consider covering costs to the level set by the employer although only for the period of time for which statutory payments would be available.
To begin with, we will cover these costs by using money from project budgets where there is an under-spend. If there is not any underspend, we have set a maximum payment of £500 for these costs.
To apply for an increase, grant-holders will have to sign a declaration that the funds requested are additional to statutory funding available and that there is no double funding.

Redundancy costs

This change applies to potential applicants and new grant holders from 1 April 2004

This policy change responds to recent changes to legislation, which mean that workers on fixed term contracts not renewed after two years are now entitled to statutory redundancy payments.
From 1 April 2004, grant applicants will be able to include redundancy costs in their project budget. However, this only applies if the project will end when our grant finishes and organisations will therefore know that they will have to make redundancies.

Key points:

The policy will not apply to awards made before 1 April 2004. Organisations can only apply for these costs for awards made from that date.
The payment will only cover entitlements for jobs funded by our grant and will be limited to the statutory minimum.
Applicants must include a best estimate of redundancy costs in their budget. We will not release payments until required, and then only for the amount needed.
If a project that has applied for redundancy costs under-spends our grant, they must use the underspend to cover these costs. If there is any shortfall, they can cover the difference from the budgeted amount.

Tapering funds (for groups applying for a further grant for the same project)

This applies to all development applications, that is a further grant for the same project.

Since April 2002 we have said in our application packs that we intend to introduce tapering for development applications.

The main reason why we are introducing tapering is to ensure that the projects we fund find other sources of funding and therefore reduce their dependence on the Community Fund by the sixth and final year of available funding.

Key points:

Tapering will be introduced for all development applications (that is, a further grant for the same project) awarded from 1 April 2004.
Organisations will be expected to contribute (either in cash or kind or secured funding from another source) 25 per cent of the total project cost. Therefore, the maximum award would be 75 per cent of the total project cost.
Those organisations that are unable to contribute 25 per cent will have their funding tapered. In year one, the project could receive up to 100 per cent of what is requested. For all subsequent years, the project will receive no more than 50 per cent of the year one amount.
Although tapering is the expected norm, we will have the discretion to not apply tapering if there is a good reason. If organisations believe tapering should not be applied, they will need to make a good case. Situations could include: no other funding available in the area for the type of project they want to run, or that they have tried to secure additional funding but have been unsuccessful despite having a sound project. Situations where we will not apply tapering will be exceptional.

For more information about these policies and how they might affect your organisation please contact your local Community Fund office.