Features: July 13th, 2010

The Prime Minister and the Health and the Communities Secretaries have set out their vision of public services of the future. The Local Government Association has set out a vision which involves a radical re-think of how services are delivered with decision making moved from Whitehall to local areas. The Whitehall and Town hall visions are markedly different.

Prime Minister, David Cameron, has unveiled what are described as revolutionary reforms that will “turn the Government on its head” through fundamental Structural Reform Plans to make every department accountable to the public. He pledged to transform the way the country was run saying: “We want to give people the power to improve our country and public services, through transparency, local democratic control, competition and choice.

Health service
The Health White Paper describes a radical change for the NHS. Responsibility for commissioning and budgets will be given to groups of GP practices and other professionals including social services. Providers will be freed from government control to shape their services around the needs and choices of patients.

There will be arrangements to enable better joint working with councils. The Secretary of State will set councils national objectives for improving population health outcomes. It will be for councils to decide how best to secure those objectives, including by commissioning services from providers of NHS care.

There will be greater alignment with local government responsibilities for local health and wellbeing and the Government will transfer PCT health improvement functions to local authorities and abolish PCTs by 2013.

Health and wellbeing boards will be set up to take on the function of joining up the commissioning of local NHS services, social care and health improvement. The boards, which will replace overview and scrutiny committees, will allow local authorities to take a strategic approach and promote integration across health and adult social care, children’s services, including safeguarding, and the wider local authority agenda. These arrangements will give local authorities influence over NHS commissioning, and corresponding influence for NHS commissioners in relation to public health and social care. They will not involve day-to-day interventions in NHS services.

Local Government
Communities Secretary, Eric Pickles presents the local government angle on the Prime Minister’s vision in the CLG Structural Reform Plan. It marks ‘a radical shift of power from Whitehall to local councils and communities that will make the Big Society part of every day life’. The plan sets out a new 18 month programme for the department that will deliver radical decentralising and transparency reforms that put citizens and councils in control of their communities.

Under the Reform Plan councils will report to local people rather than central government. Options will be developed to free local government from central control, including guidance, rules and funding mechanisms imposed by central departments.

Local accountability, democracy and participation will be reinvigorated by freeing local government from central and regional control, decentralising power, providing greater freedoms and flexibilities to local government and simplifying and deregulating local government finance. There will be a radical devolution of power and greater financial autonomy to local government and community groups. This will include phasing out ring-fencing of government grants to local government.

LGA vision
The Local Government Association vision
is based on the evidence of gross inefficiency through complexity and duplication that emerged from the total place pilots and on the impending 25 per cent cut in budgets. It argues that these developments demand a complete re-think of 21st century public services. The LGA paper presents a town hall view of what that change should look like.

‘Place-based budgets – the future governance of local public services’ comes at the time when localism has moved to the top of the agenda with a Localism Bill planned for the autumn. The core of the LGA vision is the creation of an Area Board, at sub regional level to be accountable for all services within its boundaries. It would be responsible for commissioning all local services. The Board would consist of a small number of elected representatives and if the sub-region is made up of one council, its members will be the councillors that comprise the existing cabinet. The chair of the local police authority would also be a member of the Board.

The Board would be accountable to local taxpayers and directly to Parliament for nationally raised funding. It would present an estimate of expenditure which would be agreed by Parliament. There would be direct accountability through the chair of the devolved body or through its chief executive.

The remit of the Board would include primary health, policing, probation, economic regeneration, planning, housing and employment support. The primary care trust boards would be abolished and the police authority would be accountable to the Board through the chair of the police authority. Senior managers of all public bodies in the area would report to the Board. See Proposal to move healthcare and policing to the Town hall.

The Boards’ budget would be created by pooling departmental budgets, or by a new formula based on allocations. There would also be a capital budget.

Ministers would retain influence through a performance management framework with a limited number of targets. There would also be a sole inspection body which would focus on areas of risk.

The arguments for a major devolution of power is that without this form of change transformation of services will not be possible, layers of bureaucracy cannot be stripped out, and costs saved. The overall saving is estimated at £100b over 5 years.
See Devolution the key to improved public services.

Two visions but shared direction

The two visions present different views about where decisions should be taken and the extent of governance changes that should be made. The Whitehall view is that accountability should remain as at present and that multiple departmental funding streams will continue, as will multiple public bodies with their own governance arrangements. But within this framework, there should be greater integration with the NHS and delegation of spending decisions on Communities and Local Government budgets to councils. There is no reference in the Health White Paper or the CLG Reform Plan to area based budgets, nor to place based governance.

The LGA vision takes the total place approach which starts at the opposite end of the chain by looking at what the customer needs. To achieve this end, accountability should be moved to the place, with a place based vote.

Although the two visions are very different, they are not incompatible. Total place thinking and area based working are here to stay and greater integration with health services and removing some ring fencing will encourage this process. Change will happen organically and the end result may be quite different to either the Whitehall or the Town hall visions of today.