Rising to the Challenge
John Rouse and Matthew Taylor have both written in LGC recently about how councils rise to the looming challenges. The first emphasising the hard choices required to forge a new model of local public service, the second on the creation of a pro-social council. Here’s my recent take on the situation, from an article published in our own Cllr magazine….
That councils need to adapt is not news. So soon after the latest round of re-organisation, it will be the last thing that large parts of local government want to countenance. However, the recession, the root causes of which are now well documented, demands an appraisal of new ways of working with partners and serious consideration of new structures.
The impact of the downturn is to dramatically change circumstances for both authorities themselves and communities. Like an oil tanker, the public finances will take an eternity to slow down and turn around. Indeed, the extent to which they will deteriorate further seems to remain unknown, but all agree that a serious real terms decline is on the cards. A realistic pre-budget assessment by the widely respected Institute for Fiscal Studies’ estimated that whoever is Chancellor after the next election will have a stark choice to make – to cut public spending or raise taxes by an average of £1,250 per family?
The knock-on effect for local government is as inevitable as it is unpalatable.
The business of local government has to be delivered in a cost effective way which avoids compromising the value delivered in increasingly marginalised communities. Simply ceasing to offer services brings the improvement story of the last decade grinding to a halt and therefore has to be an option of very last resort. While seeking efficiencies and reducing overheads is ever more painful but important, it is only part of the story as the financial position of authorities weaken.
So more radical solutions need to be considered. Moves to share resources across the wider local public sector need to be accelerated so that costs can be shared. See Michael Bichard’s section of HMT’s Operational Efficiency programme for more on this. Commissioning arrangements need to be beefed up so that what we often refer to as political process properly includes elected members, accurately interprets community need, and is alive to the relative advantages of in-house delivery and partnerships with each of other public sector organisations, the voluntary sector and the private sector. Of course, what must be avoided here is the creation of a complex web of relationships (i.e. the health purchaser-provider dynamic) around service delivery which are counterproductive, diminishing accountability and outcomes for communities.
There are some early movers, perhaps the most high profile of which is LB Barnet. Their plan is to streamline the council into a strategic hub which is home only to democratic control and commissioning based on a range of alliances. It is grounded in the brutally honest premise that the council has neither the capacity nor the resources to meet its ambitions and do everything asked of it by central government and has drawn both praise and criticism in equal measure. In the case of the latter, there is doubt that the local (social enterprise) economy will have a chance of wining out over big, private, business, and that it is selling employees short.
Meanwhile, Vale of White Horse and South Oxfordshire District Councils are established examplars for shared arrangements among second tier authorities. A single senior management team now covers both authorities, with a shared waste management and collection contract soon to follow the successful shared finance function. The difference in political control shows that delivering efficiency and quality services can be a comfortable bedfellow of local identity. Such a model may even save smaller districts whose reserves and revenues have been hit severely by recent events.
For years now performance has hogged the limelight. Latterly, efficiency has demanded attention. Only now that the grim hue of future settlements becomes obvious are parts of local government turning serious attention to structures and new ways of working.
The scrutiny to which the likes of Barnet will be exposed is entirely justified. Rightly, there is further concern that responsiveness to community need – something at which councils excel compared to the private sector – could get lost in transition. But you cannot accuse the north London borough of ducking the major issues. By no stretch of the imagination did it anticipate our crisis, but by thinking seriously about its own viability as a responsible public sector body, the merits of a mixed commissioning economy in its area, and how all – residents included – tackle the giants of our time such as the behaviour change needed to make climate change adaptation a reality, it is giving itself the very best chances of survival in the post recession world.
In this environment, local government can be the community leader it once was, without necessarily emulating the 19th century municipal model. Without losing capacity, it can still be leaner. By taking on new responsibilities carefully in areas around management of our valuable natural resources, it can be still more relevant. With sensible and accountable commissioning based on the right relationships, it can be both.