Councils are facing up to the austerity challenge in new and innovative ways. Getting rid of unnecessary EU red tape would help too
Local authorities are well aware that it’s not going to get easier for the sector over the next few years; in fact it may get much worse.
There are plenty of doomsday scenarios that might keep chief finance officers awake at night but, in typical fashion, local authorities are already planning for the future.
Localis’ new report, Catalyst Councils, looks at new ways of delivering services that councils are developing, either in-house or with external
providers and communities, to get enough ‘bang for buck’ to meet the financial challenge both now and in the future.
In doing so, it highlights the benefits and disadvantages of these new approaches, including: traded and shared services, ‘next generation’ partnerships, mutuals, and co-operatives.
Ultimately, it’s clear that in the years ahead the world of local public service delivery is going to be very different. The model of councils as a universal provider of services direct to the public is long since gone, never to return.
New ways of working in partnership with the private sector, the voluntary sector, mutuals and communities are beginning to emerge in new and unexpected areas. Judging by our survey results and interviews with leading councillors, it seems this diversity of provision is only likely to increase in the future.
And these models are already saving councils money across the country. Essex Cares achieved a £3.5m profit in 2010-11, which was returned to the council as a dividend. Joint vehicles, such as the Salford Urban Vision partnership contribute multi-million pound savings annually for the local authority, while boosting income from business growth. Ambitious shared services proposals, such as London’s Tri-borough, are aiming for £300m of savings over ten years, with significant gains made already.
Even before the onset of troubled times in the western economy, local government has been ahead of the game in innovating here. Despite this, there remain significant barriers to more efficient and effective working.
Localis has long argued that this is the case around commissioning and procurement and our research and survey findings suggested that in this respect nothing has changed.
European Union procurement directives are a source of frustration for commissioning teams and providers, whether large or small. These directives are in the midst of being renegotiated, but we have urged the government to go further and argue strongly for a truly fundamental reshaping to make them much simpler, less burdensome, and more flexible.
Council chiefs also think that bringing in expertise is another key reason for working with external providers, but this needs to be done correctly. As many saw from the development of private finance initiatives, if this is not handled with care, the model may be discredited and the opportunity lost.
While finance and growth remain the key drivers of local government, and will do so for years to come, as a committed localist it is pleasing to see such a variety of solutions out there.
Across the country, councils are being open-minded about how they restructure their services and how these integrate with others from across the public sector and beyond.
The next year or two will see some exciting developments; working in local government right now certainly isn’t dull.
Steven Howell is a senior policy officer at Localis, the local government think-tank. Localis’ new report, ‘Catalyst Councils – A new future for local public service delivery’, produced in association with Capita Symonds, was launched today by Oliver Letwin MP and Sir Merrick Cockell, and is available from the Localis website
