The latest SOLACE Foundation Imprint pamphlet considers how councils can tackle the recession. Heather Jameson looks at the advice
In the introduction of this month’s SOLACE Foundation Imprint (SFI) pamphlet, Active in adversity: Councils respond to recession, the Audit Commission’s David Walker claims this is – to paraphrase Charles Dickens – the best of times and the worst of times for local government.
As an opening to SOLACE’s contribution to how councils should react to the recession, it acts as a reminder of the severity of the situation – but also the opportunities it offers local government to act on behalf of their communities, and to lead their residents forward in difficult times.
As Lucy de Groot, former executive director of the IDeA says: ‘The rule book developed over the past 16 years of relative prosperity may, sadly, no longer be valid.
‘And as the rules change, councils, their partners and local businesses will have to innovate.’
The SFI pamphlet puts forward many possible solutions for local authorities dealing with the recession, from local authority banking to credit crunch commissions.
For LGA programme director for regeneration, Paul Raynes, the Government can help by giving local authorities more freedom to deal with the problems, and the tools to help build the economy.
‘The recession is highlighting the way in which councils which wish to do more remain hemmed in by needless rules... Councils are finding that the regulatory framework for capital investment, or planning, for example, still put barriers in the way of action they would like to take to help local businesses.’
He claims the ‘recession ought to accelerate devolutionary reform’, and says the LGA is lobbying the Government to give councils the freedom to do more.
NLGN director, Chris Leslie, has highlighted some of the things councils are already doing. He cites Essex and Birmingham for their foray into the banking work, in a bid to help the local economy and combat the lack of trust between businesses and the banking sector. He calls on councils to mobilise to come up with solutions, show leadership, and prove to the Government that they are ready for the task ahead.
Mr Leslie says: ‘Next, councils should recognise they are immensely more competent and financially capable than they were 15 years ago.’
He also calls for a change to the financial rules to allow councils help the economy. Under current rules, councils must balance their expenditure with their in-year income each year, unlike the Treasury which is able to balance its budgets over a number of years.
Mr Leslie asks for a change in rules to allow a three-year balance to match the current three year spending settlement.
‘This could facilitate a new suite of policy choices for council leaders,’ he says.
John Tizard, from Birmingham’s Centre for Public Service Partnerships, warns that the efficiency savings which have been easy to achieve in the past are never going to be enough to meet the new economic shortfalls.
He says: ‘A bolder and more strategic alternative is required.
‘Add together DWP expenditure, that of local government, the police, the justice system, the health services and other agencies, and millions of pounds can become billions,’ he says.
He calls for councils to look at the total expenditure of public services in their area. ‘Joint interagency procurement could enable agencies to use their market power more effectively,’ he says.
For Rod Aldridge, the founder of outsourcing firm Capita, and now chair of the Aldridge Foundation, the answer to efficiency problems, in part at least, are shared services and outsourcing.
He claims: ‘The more relevant question taxpayers should be asking is, “Why is it that a local authority or government department can’t achieve these savings themselves without outsourcing services?”
‘The answer is that they don’t have the skills needed, the culture to be able to implement the approach, or the incentives to be able to make it happen.’
The recession will, he says, expose this shortfall.
As David Walker concludes: ‘Local authorities could do much more.
The political and financial feasibility of that more ‘should be a subject of urgent debate’.
l For downloads of SFI pamphlets, go to: www.solace.org.uk/asp/news_sfi.asp
As an opening to SOLACE’s contribution to how councils should react to the recession, it acts as a reminder of the severity of the situation – but also the opportunities it offers local government to act on behalf of their communities, and to lead their residents forward in difficult times.
As Lucy de Groot, former executive director of the IDeA says: ‘The rule book developed over the past 16 years of relative prosperity may, sadly, no longer be valid.
‘And as the rules change, councils, their partners and local businesses will have to innovate.’
The SFI pamphlet puts forward many possible solutions for local authorities dealing with the recession, from local authority banking to credit crunch commissions.
For LGA programme director for regeneration, Paul Raynes, the Government can help by giving local authorities more freedom to deal with the problems, and the tools to help build the economy.
‘The recession is highlighting the way in which councils which wish to do more remain hemmed in by needless rules... Councils are finding that the regulatory framework for capital investment, or planning, for example, still put barriers in the way of action they would like to take to help local businesses.’
He claims the ‘recession ought to accelerate devolutionary reform’, and says the LGA is lobbying the Government to give councils the freedom to do more.
NLGN director, Chris Leslie, has highlighted some of the things councils are already doing. He cites Essex and Birmingham for their foray into the banking work, in a bid to help the local economy and combat the lack of trust between businesses and the banking sector. He calls on councils to mobilise to come up with solutions, show leadership, and prove to the Government that they are ready for the task ahead.
Mr Leslie says: ‘Next, councils should recognise they are immensely more competent and financially capable than they were 15 years ago.’
He also calls for a change to the financial rules to allow councils help the economy. Under current rules, councils must balance their expenditure with their in-year income each year, unlike the Treasury which is able to balance its budgets over a number of years.
Mr Leslie asks for a change in rules to allow a three-year balance to match the current three year spending settlement.
‘This could facilitate a new suite of policy choices for council leaders,’ he says.
John Tizard, from Birmingham’s Centre for Public Service Partnerships, warns that the efficiency savings which have been easy to achieve in the past are never going to be enough to meet the new economic shortfalls.
He says: ‘A bolder and more strategic alternative is required.
‘Add together DWP expenditure, that of local government, the police, the justice system, the health services and other agencies, and millions of pounds can become billions,’ he says.
He calls for councils to look at the total expenditure of public services in their area. ‘Joint interagency procurement could enable agencies to use their market power more effectively,’ he says.
For Rod Aldridge, the founder of outsourcing firm Capita, and now chair of the Aldridge Foundation, the answer to efficiency problems, in part at least, are shared services and outsourcing.
He claims: ‘The more relevant question taxpayers should be asking is, “Why is it that a local authority or government department can’t achieve these savings themselves without outsourcing services?”
‘The answer is that they don’t have the skills needed, the culture to be able to implement the approach, or the incentives to be able to make it happen.’
The recession will, he says, expose this shortfall.
As David Walker concludes: ‘Local authorities could do much more.
The political and financial feasibility of that more ‘should be a subject of urgent debate’.
l For downloads of SFI pamphlets, go to: www.solace.org.uk/asp/news_sfi.asp
