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Community groups given lifeline after raid on council's cash reserves

PUBLISHED: 16:42 05 December 2012 | UPDATED: 16:45 05 December 2012

Community organisations have been given a lifeline after Mayor of Tower Hamlets Lutfur Rahman plundered council coffers to increase their grants.

Around £700,000 has been allocated from the council’s “rainy day” reserve fund to organisations across the borough after plans to slash their grants were met with outcry and warnings centres would be forced to close.

Mayor Rahman announced this week that a total of more than £8m will be dished out between 430 groups over 27 months from next April.

Mayor Rahman said: “What we have done is kept our promise and delivered more than £8m in grants.

“That’s more than any other authority in London, and more than ever in our history.

“Not everyone got what they applied for, but everyone got a grant to keep them going”, he added.

The decision comes two months after the Mayor’s Independent cabinet first announced controversial plans to cut some organisations’ grants by up to 75 per cent.

Mr Rahman had been criticised for slashing the budgets of welfare and advice centres, but he insisted this week that he had “personally reviewed” more than 100 applications to ensure cash was dished out fairly.

He also urged groups to do more to ensure that they are not reliant on council grants to provide services during a period when it is trying to make £100m of savings over four years.

“We want to see that they are delivering value for money and making a difference to the lives of people”, Mayor Rahman added.

Labour group leader Joshua Peck welcomed the decision to reverse some of the cuts first proposed two months ago.

However, he said “serious concerns remain” over the decision to award funding to some newer organisations at the expense of centres which had been providing a service for years.

“Whilst we welcome that funding has been partially restored to a number of important organisations, we are concerned that the Mayor has once again raided the reserves so that he can do this”, he said.

“We will now take a good hard look at these funding proposals to ensure that they really do represent the best interests of our local community.”

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