Town halls offered flexible take on efficiency

28 Oct 04
The explicit efficiency targets for local government, set out in Sir Peter Gershon's review, are to be relaxed in favour of a more 'flexible' approach to meeting the overall £6.45bn figure, Public Finance understands.

29 October 2004

The explicit efficiency targets for local government, set out in Sir Peter Gershon's review, are to be relaxed in favour of a more 'flexible' approach to meeting the overall £6.45bn figure, Public Finance understands.

In a guidance pack due to be sent to all council chief executives shortly, the Office of the Deputy Prime Minister is likely to clarify confusion over schools, procurement and policing cuts set out in July.

In Gershon's review, 40% of the £6.45bn efficiency savings are to come from schools, 10% from policing and 35% from procurement for adult social care, children's services and waste.

Local government has already raised concerns about the introduction of aggregated procurement for more sensitive services such as adult care and social services. The Local Government Association has also refused to sign up to the amount of savings earmarked for social care.

A local government source said councils now expected the ODPM to relax these targets. 'This flexibility point has been a big issue. We are expecting the ODPM to say that as long as we meet the overall target by 2008, we will have the flexibility to find the savings ourselves.

'This, of course, might lead to some departments not meeting theirs, but councils will.'

This flexibility could have a significant impact on Whitehall's targets, if for example, councils decide not to make significant changes to services under the big spending departments such as education and health.

It could also lead to an internal row as departments jostle to reach their targets.

The Department of Health led the way this week, launching its Care Services Efficiency Delivery programme. Several teams of four 'care services and business' experts will be spending three to five days with 56 councils over the next few months to look at 'new ways of configuring, procuring and delivering' care services. The first councils to be reviewed include Blackpool and Peterborough.

David Rogers, chair of the LGA's community wellbeing board, said he welcomed the department's 'openness' so far. 'The £6.45bn efficiency savings are for local government as a whole over three years, and it is up to local government how to achieve these savings across its services.

'It will be important that the DoH shares the lessons from its visits to councils with other councils within this context.'

PFoct2004

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