27 October 2009
SOLACE conference marks end of the age of affluence
Michael Burton
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Looming spending cuts, shared services, efficiency, Total Place and reduced managements were the talk of the conference this year, reports Michael Burton.
It may not feel like it to delegates, but last week’s SOLACE conference could prove to be a watershed event which participants will look back on through a mist of nostalgia for a lost golden age.
By this time next year, we will be six months into a new government, the gloves will be off regarding public spending, and the word ‘cuts’ will no longer be something ministers whisper in case the electorate gets to hear of it.
The next CSR round will be under way and the public sector will be dreading the arrival of April 2011. This year’s SOLACE event marked the end of an age of affluence in the public sector.
The importance of this year’s SOLACE conference, therefore, has been to prepare the ground for one of the most difficult periods in public sector history. One delegate told me we should not be planning for the next five years, but the next 30.
The publication of the IDeA’s study into shared chief executives at the conference underpinned a much wider discussion among delegates about shared services, the future of districts, the impact of the cuts and the wider Total Place agenda. This was all against a backdrop of sharply-declining budgets expected from 2011.
As it happened, I chaired a pre-conference workshop on the media, addressed by two lobby correspondents from the Daily Mirror and the Daily Telegraph newspapers.
One bit of feedback which seemed to hit home with them was that while the national media had been waiting for PM Gordon Brown to utter the ‘cuts’ word, local government managers had been discussing virtually nothing else for the past 12 months.
So why, said the audience, don’t the national newspapers do their readers a favour and get stuck into the debate about just what public services we can afford, rather than wait for the nod from Number 10?
With this in mind, shadow chief secretary Philip Hammond’s speech to delegates on the first afternoon of the conference set the tone. He did not speak down to his audience, or issue platitudes or false praise. He simply warned that the first 100 days of a Conservative Government would mean top-down policies to address the fiscal crisis, followed by the much-promised localism. The fact that he was speaking as shadow chief secretary to the Treasury, and not shadow CLG secretary – as he reminded us – gave it added importance.
Reaction to his speech ranged from ‘the best I’ve heard by a politician’, to ‘a sense of déjà vu – he sounded like Labour back in 1996’.
Personally, I thought it a thorough and measured account of what a Conservative Government would mean for councils, but it is true that if you shut your eyes, it could have been a speech from a Labour minister.
Yes, councils have done well with efficiency, but no, there’s still more to be done, was the message. And with his pop at senior salaries and pensions, he was certainly no different from his opponents. Nonetheless, the word on the street is that he is the one to watch – the power behind [potential chancellor] George Osborne.
In comparison, local government minister Rosie Winterton’s speech, two days later, was lightweight. At least she turned up, taking the 9am slot the morning after the conference dinner, but since chief executives go to bed at sensible times, there was a full turnout. Communities secretary, John Denham, was supposed to be speaking, but he decided the Royal Society of Arts was a more important venue for him to talk about Total Place than the annual gathering of the people who run UK local government. As one affronted delegate said to me: ‘Do you think, in the week of an ACPO conference, that the home secretary would even contemplate speaking anywhere else?’
Anyway, Ms Winterton used her speech mainly to drag up the issue of senior pay, announcing that such salaries would have to be published in annual accounts, to which SOLACE had to remind her the society had already proposed such an idea. The CLG also made a point of press releasing this part of the speech.
It struck, I thought, a sour note. Most delegates this week had talked of how to deal with slashed budgets, protect their communities as well as services, maintain stalled regeneration projects, step up efficiency programmes, and merge managements to reduce overheads, and yet here was a minister banging on about their pay.
As one head-hunter commented to me afterwards: ‘It’s already hard enough finding chief executives for the big councils. Many directors are already saying it’s not worth the hassle. And as for trying to get more private sector people involved, forget it.’
A different light on budgets was delivered by Audit Commission chief executive, Steve Bundred. He said he predicted the likely level of cuts needed to reduce the deficit as £100bn. However, he added, this still left public spending levels at about the same as in 2005/6, and urged his audience not to ‘panic’ as it was ‘perfectly manageable.’ He also asked why the NHS and education should be spared. After all, he argued, they had been stuffed with cash without any increase in productivity.
He also warned what many chief executives outside London were already becoming concerned about, namely, the impact of major public spending cuts in areas where the public sector was the biggest employer. He said it could cause a double dip or a ‘W’-shaped recession, and added that in some regions, the public sector’s proportion of the economy was greater than in Cuba.
One London borough chief executive told me: ‘I can lose 300 staff, but they’ll find jobs down the road. In a place like Sunderland or Hull, those 300 staff simply end up on the dole.’
Mr Bundred’s take, however, was not that as a result, cuts should take into account the impact of job losses in such areas, but that public sector employers should encourage their economies to diversify. All very sensible but unlikely to help in the short term.
Another issue doing the rounds in the coffee breaks was the future of two-tier areas. With further reorganisation now off the agenda, and that in Suffolk, Norfolk and Devon heading for the long grass, the inexorable pressures to share overheads will occur on a voluntarily basis.
An IDEA report, delivered at the conference, analysed the savings from 10 sets of councils sharing their chief executives. A common view among two-tier delegates was that districts would have no choice but to merge managements and back offices, even if they kept separate councillors and outward identities.
So, what was the overall mood? Chief executives are generally a robust, positive and resilient breed, used to dealing with what is being thrown at them. There was no sense they were unaware of what lies ahead. Many told me they had sorted 2010/11 budgets, and were grappling with the more challenging 2011/12 round, although the level of expected cuts seemed to vary.
While speakers across the political divide, plus Mr Bundred, agreed that local government had done better on efficiency savings than the rest of the public sector, several delegates told me this was hardly difficult when public funding had been annually increasing.
On a personal level, they know salaries are under scrutiny. A few reacted nervously to Philip Hammond’s pledge in his speech to keep pensions to £50,000 a year, but pension regulations cannot be changed on the whim of ministers. Whatever the storms ahead, the public sector remains a good place in which to work.
It may not feel like it to delegates, but last week’s SOLACE conference could prove to be a watershed event which participants will look back on through a mist of nostalgia for a lost golden age.
By this time next year, we will be six months into a new government, the gloves will be off regarding public spending, and the word ‘cuts’ will no longer be something ministers whisper in case the electorate gets to hear of it.
The next CSR round will be under way and the public sector will be dreading the arrival of April 2011. This year’s SOLACE event marked the end of an age of affluence in the public sector.
The importance of this year’s SOLACE conference, therefore, has been to prepare the ground for one of the most difficult periods in public sector history. One delegate told me we should not be planning for the next five years, but the next 30.
The publication of the IDeA’s study into shared chief executives at the conference underpinned a much wider discussion among delegates about shared services, the future of districts, the impact of the cuts and the wider Total Place agenda. This was all against a backdrop of sharply-declining budgets expected from 2011.
As it happened, I chaired a pre-conference workshop on the media, addressed by two lobby correspondents from the Daily Mirror and the Daily Telegraph newspapers.
One bit of feedback which seemed to hit home with them was that while the national media had been waiting for PM Gordon Brown to utter the ‘cuts’ word, local government managers had been discussing virtually nothing else for the past 12 months.
So why, said the audience, don’t the national newspapers do their readers a favour and get stuck into the debate about just what public services we can afford, rather than wait for the nod from Number 10?
With this in mind, shadow chief secretary Philip Hammond’s speech to delegates on the first afternoon of the conference set the tone. He did not speak down to his audience, or issue platitudes or false praise. He simply warned that the first 100 days of a Conservative Government would mean top-down policies to address the fiscal crisis, followed by the much-promised localism. The fact that he was speaking as shadow chief secretary to the Treasury, and not shadow CLG secretary – as he reminded us – gave it added importance.
Reaction to his speech ranged from ‘the best I’ve heard by a politician’, to ‘a sense of déjà vu – he sounded like Labour back in 1996’.
Personally, I thought it a thorough and measured account of what a Conservative Government would mean for councils, but it is true that if you shut your eyes, it could have been a speech from a Labour minister.
Yes, councils have done well with efficiency, but no, there’s still more to be done, was the message. And with his pop at senior salaries and pensions, he was certainly no different from his opponents. Nonetheless, the word on the street is that he is the one to watch – the power behind [potential chancellor] George Osborne.
In comparison, local government minister Rosie Winterton’s speech, two days later, was lightweight. At least she turned up, taking the 9am slot the morning after the conference dinner, but since chief executives go to bed at sensible times, there was a full turnout. Communities secretary, John Denham, was supposed to be speaking, but he decided the Royal Society of Arts was a more important venue for him to talk about Total Place than the annual gathering of the people who run UK local government. As one affronted delegate said to me: ‘Do you think, in the week of an ACPO conference, that the home secretary would even contemplate speaking anywhere else?’
Anyway, Ms Winterton used her speech mainly to drag up the issue of senior pay, announcing that such salaries would have to be published in annual accounts, to which SOLACE had to remind her the society had already proposed such an idea. The CLG also made a point of press releasing this part of the speech.
It struck, I thought, a sour note. Most delegates this week had talked of how to deal with slashed budgets, protect their communities as well as services, maintain stalled regeneration projects, step up efficiency programmes, and merge managements to reduce overheads, and yet here was a minister banging on about their pay.
As one head-hunter commented to me afterwards: ‘It’s already hard enough finding chief executives for the big councils. Many directors are already saying it’s not worth the hassle. And as for trying to get more private sector people involved, forget it.’
A different light on budgets was delivered by Audit Commission chief executive, Steve Bundred. He said he predicted the likely level of cuts needed to reduce the deficit as £100bn. However, he added, this still left public spending levels at about the same as in 2005/6, and urged his audience not to ‘panic’ as it was ‘perfectly manageable.’ He also asked why the NHS and education should be spared. After all, he argued, they had been stuffed with cash without any increase in productivity.
He also warned what many chief executives outside London were already becoming concerned about, namely, the impact of major public spending cuts in areas where the public sector was the biggest employer. He said it could cause a double dip or a ‘W’-shaped recession, and added that in some regions, the public sector’s proportion of the economy was greater than in Cuba.
One London borough chief executive told me: ‘I can lose 300 staff, but they’ll find jobs down the road. In a place like Sunderland or Hull, those 300 staff simply end up on the dole.’
Mr Bundred’s take, however, was not that as a result, cuts should take into account the impact of job losses in such areas, but that public sector employers should encourage their economies to diversify. All very sensible but unlikely to help in the short term.
Another issue doing the rounds in the coffee breaks was the future of two-tier areas. With further reorganisation now off the agenda, and that in Suffolk, Norfolk and Devon heading for the long grass, the inexorable pressures to share overheads will occur on a voluntarily basis.
An IDEA report, delivered at the conference, analysed the savings from 10 sets of councils sharing their chief executives. A common view among two-tier delegates was that districts would have no choice but to merge managements and back offices, even if they kept separate councillors and outward identities.
So, what was the overall mood? Chief executives are generally a robust, positive and resilient breed, used to dealing with what is being thrown at them. There was no sense they were unaware of what lies ahead. Many told me they had sorted 2010/11 budgets, and were grappling with the more challenging 2011/12 round, although the level of expected cuts seemed to vary.
While speakers across the political divide, plus Mr Bundred, agreed that local government had done better on efficiency savings than the rest of the public sector, several delegates told me this was hardly difficult when public funding had been annually increasing.
On a personal level, they know salaries are under scrutiny. A few reacted nervously to Philip Hammond’s pledge in his speech to keep pensions to £50,000 a year, but pension regulations cannot be changed on the whim of ministers. Whatever the storms ahead, the public sector remains a good place in which to work.
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