Magic numbers, value for money and simply doing the right thing

If any small business in Cornwall was told it was suddenly to take a £332,000/year cut in income it would probably be in some difficulty. Yet that is precisely one consequence of Cornwall Council's recent budget for Tremorvah Industries, a small business operating on the Threemilestone industrial estate, Truro, as part of the council's Adult Care department.


Tremovah currently employs 54 people, 44 of them supported by the government's Workstep Employment Grant, a discretionary allowance which helps people with disabilities (often the result of an accident) find their way back into work. Tremorvah was established in the early 1980s, having originally been part of the rehabilitiation centre at Truro's old City hospital.

Cornwall Council's budget plans for its £332,000 subsidy to be scrapped, over time, leaving Tremorvah to eventually brave the realities of free markets. Given the highly specialised nature of its products (mostly concerned with improving access and mobility for people with disabilities) and its core remit - to provide work for people who often have quite a profound disability themselves - Tremorvah's survival in a competitive global environment is far from assured.

For some reason the impact of the budget cuts on Tremorvah didn't make headlines when the budget was actually agreed. Must have been one of those pesky details which so easily get overlooked.

Council officials are now suggesting that instead of scrapping the subsidy, they could instead simply boost Tremorvah's turnover by buying more of its products. Within three years, the argument goes, turnover will be large enough for Tremorvah to survive without council support.

Officials point out that only 11% of Tremorvah's business is currently with the council and that by making the business a "preferred internal provider" they could increase this to 31%. The deadline for making this happen is 31st March and officials are keen to embark upon a "benchmarking" exercise designed to show how this would be good value for money for the taxpayer, as well as comply with EU competition rules.

The obvious question is that if the council has a need for more of Tremorvah's products and services, why isn't it buying them already? I forecast some free-market-defying accountancy-wizardry will be needed to make the business case. Indeed, the lexicon of local government jargon may need to be extended to find a new word for "subsidy."

But this is to ignore the wider, far more important question - and one which puts the "budget hawks" at County Hall in a difficult position. What does our "Big Society" actually expect from people who have the sort of disabilities which prevent them from elbowing their way to the front of the jobs' queue?