Features: October 21st, 2010

The Spending Review will cut council budgets by 28 % over the next four years resulting in significant job losses and a major rethink of how services are delivered. The Spending Review also lays the foundation for transformation of services when the pain of downsizing has subsided. The new concept of a community budget will be introduced in 2011 on a pilot basis. But transformational change based on the total place philosophy is many years down the track.

The expectation of the Local Government Association ‘for something more ambitious than pilot place based budget projects’ has not been realised and there will be a long period of piloting before any widespread transformation of services takes place.

But the launch in April 2011 of 16 community budget pilots puts the stamp of approval on the total place philosophy of taking a whole area approach to public services. An area budget is an absolute essential to put total place thinking into practice and when a budget is in place it allows all functions, not just a specific issue such as alcohol abuse, to be tackled on an area basis without functional boundaries. A community budget is put together by pooling all the budgets from the central departments to allow the local public service partnerships to work together to improve outcomes and cut costs.

A community budget epitomises the concept of localism, and while simple in concept, raises many complicated issues. The ability of ministers to decide what should be done locally is removed. The task of devising policy and implementation guidelines is moved from Whitehall to the local partnership. Although changes of this nature are widely applauded, they lead to challenges such as, how is the local partnership to be governed? How are the capabilities of local managers to be enhanced to allow them to play a new ball game? They will have to work across professional boundaries and to devise local policy. There will also be staffing issues to be resolved, such as differing pay and conditions for people doing similar jobs. Possibly the greatest risk inherent in community budgets is that they could lead to a post code lottery with the least effective local partnerships struggling to cope.

Limiting the scope of community budgets

Because community budgets are new territory with major challenges, the pilot projects have been tightly constrained. They will be limited in scope to families with complex needs. The total place pilots found that on average about 100 families in an area consumed a disproportionate amount of taxpayers’ money. Limiting the scope of the projects in this way will provide sufficient ground to test the concept and explore solutions to the challenges, but there will be a low risk with relatively few recipients of public services involved. Unlike total place, there will be no opportunity for unofficial pilots, or ‘parallel places’.

The pilots have been welcomed. Rebecca Murphy, Chief Executive of the North West Improvement Partnership said: “This is a step in the right direction and will allow councils and their partners to wrap resources around families that are known to have a long term impact on the resources of a wide number of agencies . By focusing attention on individual families in this way, prevention activity and coordinated interventions can be delivered through a community budget to break the cycle of need and longer term dependency on public services by working with families in a whole system way. These families often demand a high level of resources from the council, health, justice/police services and government agencies, as well as others and this focus on co-ordinated support and intervention should reduce the longer term costs. The opportunity for all places to operate in this way from April 2013 is a positive step.”

The national roll out of community budgets in April 2013 will be restricted to families with complex needs. Taking up the budgets will be optional. But at this time, with a further two years of downsizing ahead and with GP consortia taking over the role of primary care trusts, it is arguable how many partnerships will feel they have the capacity to cope with more change.

There is no indication when community budgets will be extended beyond families with complex needs. Before there is any widening of the scope, ministers will need to feel that they can live with the loss of power to influence how taxpayers money is spent. On the ground the partnerships will have to work their way through the challenges that are known and those that no one has recognised so far. Recipients of services and local residents generally will need to feel that the change works. This could be a long way ahead.

Pilots and the Productivity Programme

The work of the 16 community budget pilots will be complemented by the Place Based Productivity Programme launched by the Local Government Association earlier in the year. Two of the Programme workstreams are particularly relevant to the pilots. Leadership is a key issue and a group is looking at ways to build the capacity of councillors and other local leaders to lead their communities. Another group is looking at workforce and skills issues. Their remit includes exploring the barriers of staff flexibility and transfer between different parts of the public sector.

The Spending Review will reshape public services over the next four years and one inevitable outcome will be smaller organisations. The budget cuts will hurt. Baroness Margaret Eaton Chairman of the LGA said: “Town halls will now face extremely tough choices about which services they can keep on running. These cuts will cause real pain and anxiety for millions of people who use the services councils provide, from keeping children safe to ensuring that streets are clean.” The cuts are permanent. At the end of four years when the deficit has been eliminated public services will have descended to the bottom of the trough. Re-building services without new funding will be a major challenge. Because of the work done by those who pioneered total place, it is possible to see light at the end of a very long tunnel. Total place as a brand is now history, but its principles are firmly embedded in community budgets.