Community budgets, which will empower localities to tackle public service challenges according to the particular needs of the area, have been given the green light by Communities Secretary Eric Pickles. Local councils will play the leading role in pooling resources and joining up services.

Community, or place based budgets, have emerged from the total place pilot projects which focused on specific issues in areas such as care for the elderly or alcohol abuse.

Eric Pickles’ announcement is unclear about the speed or extent to which central government departments will move spending decisions from Whitehall to the town halls. These details will emerge from the Comprehensive Spending Review to be announced on 20 October 2010. In a speech to the Conservative Party Conference he said: We’ll allow councils to pool the budgets across the public sector – social services, care, housing and health improvement.

There has been much activity on place based budgets in the past few weeks. The Local Government Group has worked with councils to present evidence to the Treasury on the feasibility of giving councils freedom to pool resources across their departments and with their partner organisations such as primary care trusts. Four councils have presented papers to the Cabinet Office, who are examining the practical issues of pooled budgets with Turning Point, a leading social care organisation.

Community budgets raise many complicated issues which involve culture as well as finance. Progress towards a new arrangement is likely to be slow. Following the publication of the Spending Review the LG Group will start work on developing an action plan to take the proposal forward as part of the Place Based Productivity Programme.