Government cuts consumer grants

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THE Government is cutting its aid to consumer organisations by up to 50 per cent - in an attempt, critics claim, to stifle opposition to deregulation and privatisation.

The National Consumer Council, Citizens Advice Bureaux and user groups in the nationalised industries and utilities are facing unprecedented cuts in grant from the Department of Trade and Industry - despite an increased demand for their services caused by recession and new legislation.

The DTI has denied there is a 'hidden agenda' in the cuts, but critics, including the Labour Party, have accused ministers of attempting to hamstring consumer groups for the benefit of shareholders and directors, and 'intimidating' bodies such as the Post Office Users National Council so that they soften their hostility to privatisation.

Ken Hall, secretary of the POUNC, which has had its budget cut by nearly 30 per cent, said last week that he 'could not imagine there would be any deliberate attempt to spike our guns', but added: 'The DTI's priorities lie in promoting exports and funding links with business . . . consumer affairs come further down the agenda.'

However, a new pressure group, Consumer Action, which has Lord Young of Dartington, founder of the Consumers Association, as its president, believes that independent consumer organisations may end up touting for commercial sponsorship to make up the shortfall in their budgets.

Roger Warren Evans, one of Consumer Action's founders and chairman of the management committee of the Welsh Consumer Council, said the cuts were a 'betrayal of trust' and the NCC, which faced a 15 per cent cut this year and further possible 10 per cent cuts over the next two years, had been 'unfairly selected' for harsh treatment because it had criticised the Government. 'The confidence of NCC staff is shaken and they are bound to be more reluctant to be honestly critical of the Government in future,' he said.

The NCC has had to stop all work on housing and education and has dropped projects on food safety, rail and postal privatisation, environmental taxes and financial services.

Ann Abraham, chief executive of the National Association of Citizens Advice Bureaux, which faces a four-year freeze on its budget, said clients' problems were increasingly complex and it was hard to see how cuts could 'sit comfortably with the (DTI's) objective of ensuring that consumers are fully informed, let alone comprehend where . . . this fits in with the Government's objectives of empowering citizens under the Charter initiative.'

Despite John Major's much-publicised Citizen's Charter, many observers feel that consumerism now comes a poor second to business on the Government's policy agenda: the consumer affairs minister, for example, is usually an obscure peer rather than a high- profile figure in the Commons. (It is currently Earl Ferrers).

The NCC has attacked the performance of the privatised water, gas and electricity companies and expressed strong criticism of deregulation proposals.

According to Ruth Evans, its director, the cuts are not inspired by a desire to silence opposition but a failure by ministers to see a role for consumers in the market economy.

(Photograph omitted)