Going digital offers councils £14.7bn in savings

15 Mar 16

Councils could make as much £14.7bn in savings through greater digitisation of services, a review by the Public Service Transformation Network and the think-tank Nesta has found.

The Connected Councils report found that making local authorities and their services digital by default by 2025 would improve the delivery of services amid tightening budgets as well as significantly benefit local communities.

The review highlighted that digital tools are already helping many councils to improve services in councils across the world, and the potential for greater use of technology included helping councils to focus on preventative rather than reactive care as well as mobilising local people to work alongside public services.

The possible savings were calculated by the organisation Social Finance, which worked out what would be possible if best practice examples both domestically and around the world were applied widely. Their model found that if average savings from digitisation programmes can be replicated across local government, an average unitary council could save up to 13% of its total budget by 2025. Based on 2015/16 spending of £113.1bn across local government, this represents £14.7bn possible saving for the sector.

Among the case studies highlighted in the report was the London Borough of Harrow while has saved £1.55m by moving transactional services online, while 80% of Copenhagen’s transactions now happen online.

Julie Simon, head of government innovation research at Nesta, said: "As budget cuts begin to bite councils have found themselves at a crossroads. “Although digital technologies are by no means a silver bullet, they can help councils improve on the important services they offer; transforming their delivery, stimulating economic growth and ultimately improving the way they manage themselves and their resources.”

The report also urged on Whitehall to work with local authorities to help embed digital within councils by working with the sector to define data standards, as well as helping the public to navigate online services.

Responding to the report, Cabinet Office minister Matt Hancock said digital was already transforming the way we deliver services and interact with citizens.
“This report shows the sort of savings local government can make by embracing digital transformation ever further - so councils need to take these figures seriously,” he stated.

“I will continue to make sure that the Government Digital Service works with local authorities to create better services for people across the UK.”

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