Over recent years, government spending reviews and budgets have not been kind to local government.

So, news that the Local Government Finance Settlement announced at the end of December will allow for a rise in grant funding over the next two years means that the sector goes into 2023 in a better position than hoped and with more certainty .

Although the increased headline funding figure provides a welcome contrast to previous cuts and freezes to council revenues, once the impact of inflation is factored in, the outlook for local authorities is as challenging as ever: balancing the books over the next few years will require yet more service reorganisation and cuts.

As local government leaders start to plot their way through this difficult landscape, HR leaders have a critical role to play in ensuring councils can preserve the integrity of their public services.

Workforce planning

Funding aside, one of the biggest challenges facing local authorities as they plan ahead is the availability of people to deliver future services.

A hugely competitive labour market means we already have to fight harder than ever to recruit. Inflation-busting pay rises and higher salaries in the private sector make competition tough.

Given this backdrop, workforce planning led by HR which captures data and insight about the current and future availability of skills and people for key job roles and service areas is absolutely crucial.

Without workforce planning no organisation can have an accurate idea of its future recruitment and training needs, nor how realistic different options for change or service delivery will be. It is key to managing both current risks and future success.

Maximising talent in the sector

A second area where HR can make a difference is in ensuring we maximise the talents of the people who already work for us.

Retaining our current workforce is the best way of meeting our future workforce needs i.e. with people who we know are already committed to the values of public service, place and people – all so important to our work.

This also requires actioning a step change in the way we deploy people to roles in our organisations.

For example, in some roles such as finance, HR, IT or project management, the lack of opportunity to progress or get wider experience prompts people to move on. Looking at talent mobility and development across these teams, allowing opportunities to move laterally or outside to another public authority are great ways of providing career opportunity.

Other roles can benefit from different starting points e.g. recruiting and training apprentices and then moving people into other roles. This can be particularly effective in shortage areas.

Championing diversity

If you were to ask a minister or member of the public whether they want more efficient, effective public services they’d doubtless respond with a resounding yes.

It’s critical that public service leaders are clear and vocal about the critical role that equality, diversity and inclusion plays in the delivery and improvement of effective services.

Often those most in need of essential public services are the most marginalised and hardest to reach. A good awareness and understanding of those communities, their needs and how to engage them is critical to the effective delivery of services and efficient use of taxpayer money. This cannot be done without a focus on equality, diversity and inclusion both in recruitment of our people and in the way they work.

Future leadership and management capability

The public sector workforce of 2023 operates in a way which is largely unrecognisable from the beginning of this decade, as hybrid and fully remote home work has replaced desk-bound office work.

While there has been nothing short of a revolution in our ways of working, can the same be said for the way we lead and manage our people? Managers have evolved or improvised out of necessity through the pandemic, and we are now defining and developing the leadership skills and capabilities needed for this new world.

If we are to build resilient, flexible organisations where the needs of the service user, the organisation and its people are equally met, then this is a capability which cannot be left to chance and requires investment as part of any plan for change.

Honesty about the impossible

Maintaining public services through the past decade of austerity and most recently in the past two pandemic years has tested the resilience of public servants in every way. While in the past, when the impossible has been asked, councils have been able to find a way of responding, we are now in very different territory.

The combination of a sector funding formula which dates back two decades, a labour market dogged by structural shortages and the inability to plan for the long term mean that ‘more for less’ has reached its limits.

If we can’t continue to hire and retain public servants, then ultimately we cannot deliver the public services our communities pay for and rely on. It is HR’s job to ensure that leaders hear that message.

Gordon McFarlane is president of the Public Services People Managers Association and Assistant Director in Leicestershire County Council www.ppma.org.uk