27 April 2007
England's local authorities lack the expertise to implement crucial government reforms, cannot retain high-quality staff and do not reward employees according to their ability to perform their jobs, according to a study by the Improvement and Development Agency.
Its survey of local government pay and workforce issues, seen by Public Finance and due to be published on April 26, also casts doubt on town halls' ability to successfully implement the government's radical white paper proposals, which will devolve new powers to councils.
It will do little to debunk the stereotype that councils are the last bastion of an undynamic and poorly prepared workforce, unable to deliver the high-class services Whitehall demands.
Joan Munro, the IDA's national adviser on workforce strategies, said that the study, which gleaned responses from 53% of England's local authorities, 'exposed a nervousness across local government about the sector's capacity to deliver what central government expects it to deliver'.
In particular, 72% of authorities acknowledged skills gaps in 'organisational and change management' affecting crucial areas of reform such as social care and planning. Over 60% of town halls also lacked 'business process redesign' skills, which are crucial to town hall efficiency commitments.
Munro acknowledged that these shortages 'cast doubt' on councils' abilities to deliver the government's planned devolution of powers, such as frameworks to scrutinise service commissioners at ward level.
'Authorities are right to be concerned, because there is a big change agenda in local government and councils are asking: “Can we handle this change?” In some areas, there just aren't enough specialists available to the sector. It's a huge wake-up call – if town halls don't have the right change management skills, then they will need them shortly.'
Sir Michael Lyons, who recently published his eponymous review of local government, told PF: 'My review team also raised some very serious concerns around capacity across local government – including skills sets at both officer and member level. It is something that the IDA and Local Government Association must tackle.'
But attempts to correct the situation could be hindered by a second problem highlighted by the IDA study: recruitment and retention difficulties. Although fewer councils reported difficulties in 2006 (87.4%) compared with 2004 (93.4%), many sectors are still blighted, including children and families' social care (77%), environmental health (58%) and teaching (23%).
'Part of the answer is that local authorities need to be doing more to train people, locally, to do the jobs. That is about more effective budget management and better resourcing,' Munro said.
'Some authorities have successfully filled vacancies by offering higher pay rates than neighbouring authorities, but that is a short-term response that merely drives up pay unnecessarily. Local government needs a co-ordinated and more incisive response.'
She also called for a renewed focus on management practices to improve retention rates, particularly among younger employees. Councils in Cambridgeshire, for example, have successfully retained their social care staff by providing specialised administrative support. 'Breaking down bureaucracy is key,' Munro said, 'as pay issues are not always a major reason why people leave local government.'
But there are significant pay problems in the sector: possibly fuelled by the fact that just 30% of authorities have adopted a pay and rewards strategy. The Local Government Employers, which represents councils over pay and pension issues, is currently consulting on a national strategy.
Despite ministers' desire to link pay settlements more closely to staff performance, 'contribution-related progression' was the 'least frequent' system used by councils. The most common system is still the amount of time served by staff (78%), followed by a system linked to qualifications (42%).
Munro acknowledged that the study's conclusions were 'frank', but played down concerns that it would reinforce stereotypes .'I think this is just a case of local authorities being honest about the areas where they can improve. Private sector firms have similar problems, but are not as closely scrutinised. The challenge for local government now is to find ways of overcoming these problems.'
PFapr2007
