1 The Community Budgets
initiatives
1. Community Budgets were introduced in October
2010 as part of the Spending Review with the aim of giving "local
public service partners the freedom to work together to redesign
services around the needs of citizens, improving outcomes, reducing
duplication and waste and so saving significant sums of public
money".[1] The concept
underpinning Community Budgets built on the previous Government's
work on Local Area Agreements (LAAs) and Total Place. Both these
earlier initiatives were designed to focus on outcomes, and to
encourage multi-agency working and joined-up funding at a local
level. In a letter of 28 July 2011, Sir Bob Kerslake, Permanent
Secretary at the Department for Communities and Local Government
(DCLG), told local authority chief executives that the Department
wanted to roll out Community Budgets for families with multiple
problems to about 50 areas by April 2012.[2]
2. Following the riots in the summer of 2011,
the focus of Community Budgets changed. The Prime Minister and
the Secretary of State for Communities and Local Government, Rt
Hon Eric Pickles MP, announced the new troubled families programme
in December 2011, the aim of which was to change the lives of
120,000 troubled families by the end of the Parliament. The DCLG
described the main features of the programme, the problem it was
tackling and what it was aiming to achieve:
- Almost £450 million has
been made available in a new, determined, cross-government drive
to turn around the lives of 120,000 of some of the country's most
troubled families by the end of this Parliament;
- New figures show that troubled
families cost the tax payer an estimated £9 billion per year,
equivalent to £75,000 per family. This is spent on protecting
the children in these families and responding to the crime and
anti-social behaviour they perpetrate. The costs are exemplified
by the fact that children who live in troubled families are 36
times more likely to be excluded from school and six times more
likely to have been in care or to have contact with the police;
- A new Troubled Families Team
based within the Department for Communities and Local Government
and headed by Louise Casey CB, has been established to join up
efforts across Whitehall, provide expert help to local areas and
drive forward the strategy;
- The £450 million means
the Government will offer up to 40 per cent of the cost of dealing
with these families to local authorities, but on a payment-by-results
basis when they and their partners achieve success with families.
For the first time, the Government has outlined the headline goals
and how success will be measured with the following criteria:
a. children back into school
b. reduce their criminal and anti-social behaviour
c. parents on the road back to work, and
d. reduce the costs to the taxpayer and local
authorities.
- The new programme will also
fund a national network of Troubled Family 'Trouble-Shooters'
who will be appointed by local councils. The trouble-shooters
will oversee the programme of action in their area. Their responsibilities
will include: making sure the right families are getting the right
type of help; that sanctions are in place when needed; and that
positive results are being achieved with the troubled families
in their area.[3]
3. In addition to the troubled families programme,
in December 2011, Ministers announced that there would be four
Whole Place Community Budget pilots with specific objectives:
- Greater Manchester will use
local investment to reduce levels of dependency and to help create
50,000 jobs in the next four years;
- Cheshire West and Chester will
look at how to pool a single budget of between £3 to 4 billion
from over 150 local services;
- Essex County Council will formulate
a single set of objectives for the £10.4 billion they spend
on public services so that it is used more effectively and efficiently;
and
- The West London partnership
of Westminster City Council, Hammersmith and Fulham London Borough
Council, and Kensington and Chelsea Royal Borough Council will
focus on skills and training for over 16s, speeding up family
courts, and curbing youth violence and anti-social behaviour.[4]
The four areas will have access to technical expertise
such as financial or legal advice, research and analysis and suitably
qualified and experienced civil servants. Other appropriate forms
of support will be provided when needed by the community or local
partners as well there will be access to senior civil servants
who manage the Government's relationship with localities.[5]
4. In addition, there will be 10 neighbourhood-level
Community Budget pilots, which will each focus on a discrete set
of services.[6] In a Ministerial
Statement on 10 January 2012, the Secretary of State summed up
the current position on Community Budgets:
- Decentralisation of funding
and ensuring greater value for taxpayers' money are key goals
for my Department. On 21 December, my Department announced 14
new Community Budget areas that will be able to combine resources
into a locally coordinated funding pot with greater local control
that will help improve services for local people.
- Four 'whole place' pilots will create a joint
team with local partners to establish devolved budget proposals
with decision making structures for a locally run operation during
this year. This will help achieve significant public sector savings,
cut red tape and improve policy making.
- Ten 'neighbourhood level' areas have also been
selected to develop smaller scale Community Budgets that will
give residents a micro-local level say over the services they
want and use. The local community will play a leading role, working
with councils and professionals, to shape local services so they
work from a customer's perspective.[7]
Our inquiry: first phase
5. Community Budgets are an important Government
initiative with the potential not only to bring significant benefits,
but also to transform the manner in which services are managed
and provided. We therefore decided that this is an area that we
should scrutinise. Community Budgets are, however, still at an
earlier stage of development and the results even of the pilots
are some way off. It would have been premature to carry out a
full inquiry and to produce a report. We decided, therefore, to
carry out scrutiny of Community Budgets in separate stages. For
the first stage, we decided to invite written evidence, to hold
a single oral evidence session and to set out an outline of the
questions raised, which will assist our subsequent work on Community
Budgets. The issues and questions are set out below, which will
provide a starting point for the next stage of our work.
6. We invited written evidence from interested
parties, particularly from local authorities involved in the original
16 pilot areas, and from councils joining or intending to join
the programme, on all aspects of Community Budgets for families
with multiple problems. We specifically invited their views on:
- the administrative arrangements
for operating a Community Budget and the support that has been
provided by central government departments;
- what are the most significant
barriers that have been overcome, and what barriers remain to
put in place the desired services;
- what are the emerging implications for local
governance of services and who is accountable for the money spent
though Community Budgets; and
- what lessons have been identified for operating
more comprehensive Community Budgets and what lessons the troubled
families pilots will have for Community Budgets in other policy
areas, and the 'Whole Place' Community Budget pilots?
7. We received 10 written submissions and having
reviewed them, held one oral evidence session on 16 January 2012.
We heard evidence from:
- three councils—Birmingham
City Council, Suffolk County Council and Essex County Council;[8]
- the Local Government Association
and A4e Ltd, a major commercial provider of public services; and
- Baroness Hanham, Parliamentary
Under Secretary of State at the Department for Communities and
Local Government and Louise Casey, Director General at the DCLG,
Head of the new Troubled Families Team.
Issues emerging from the evidence
8. While we focused on the work undertaken over
the past year with troubled families, we also explored with witnesses
the potential of Community Budgets for wider system change, reformed
accountability arrangements, and greater service integration at
a local level. The written submissions and the oral evidence session
led us to group the issues under four headings:
a. Community Budgets as an approach to work with
troubled families;
b. measuring success of the scheme, and the prospects
for models of Payment by Results;
c. Whitehall's relationship with localities;
and
d. accountability for public funds, both locally
and centrally.
COMMUNITY BUDGETS AND TROUBLED FAMILIES
- QUESTIONS ARISING FROM WRITTEN AND ORAL EVIDENCE
9. The following questions arose from written
and oral evidence:
- Many local authorities were
already working on testing and refining different approaches to
family intervention. Has the announcement of a national programme
to address the problems of 120,000 troubled families changed the
nature of this part of the Community Budget initiative, especially
with the appointment of Ms Casey, and the lead role of Mr Pickles
as Secretary of State?
- Is Central Government using
Community Budgets as a vehicle to achieve the target it has set
centrally of addressing the problems of 120,000 troubled families?
- Will the availability of a
new source of central funds, and a good working relationship between
local areas and DCLG's central unit, have a bigger impact for
the future?
- In relation to working with
troubled families, how will existing professional and Government
Department barriers and a lack of willingness to share data be
overcome? What should be Whitehall's role, and the role of other
national bodies, in encouraging the removal of such barriers?
- Have the original concepts
behind Community Budgets—of pooled budgets and a 'single
bank account for place'—added much to what local authorities
and their partners were already doing in this field?
MEASURING SUCCESS AND THE PROSPECTS
FOR MODELS OF PAYMENT BY RESULTS
10. The national programme on troubled families
will be based on a payment-by-results model, with the Government
offering to pay up to 40% of local authorities' costs of dealing
with these families, payable only when they and their partners
achieve success with families.[9]
The following questions arose from the written and oral evidence:
- How will local authorities
be able to find the money to match the Government's contribution,
particularly because of the fact that complex multi-agency work
of this kind involves upfront investment and early intervention?
- DCLG has confirmed that the
money will run out after 2015. What happens then?
- Is the payment-by-result mechanism
the right model for releasing central government resources?
- Will measures of success and
effectiveness be difficult to establish? How will the payment-by-results
mechanism for the programme work and how will viable contractual
models for payment-by-results be developed?
- Is there consensus—across
Whitehall and locally—as to what constitutes successful
outcomes in dealing with troubled families?
- How will payments flow back
to the full range of local agencies that have contributed to outcomes?
- How will the 'invest-to-share'
model work, when it is unclear who is investing and who is saving
and when investment made by one body produces savings for another?
WHITEHALL'S RELATIONSHIP WITH LOCALITIES
11. We explored with witnesses the extent to
which the Community Budget process to date had mirrored that of
earlier similar initiatives, such as Local Area Agreements and
Total Place, in terms of working relationships. The following
questions arose from written and oral evidence:
- Have all government agencies
received the message that concerted and collaborative work on
troubled families, with action led at local level, requires their
support?
- How can relationships and communications
between Whitehall and localities be further strengthened?
- Where Community Budgets generate
better ways of working—centrally and locally—how can
these become systemic rather than one-off?
- Will the national programme
on troubled families support local authorities, or tell them what
to do, or be a mixture of the two?
ACCOUNTABILITY FOR PUBLIC FUNDS,
LOCALLY AND CENTRALLY
12. Various forms of local partnership bodies
have been advanced in terms of governance arrangements, specifically
in relation to the use of resources. The written and oral evidence
raised the following questions:
- What steps are needed at a
local level to ensure that collaborative working arrangements
are sufficiently accountable and robust to ensure that tough decisions
are made, at a time when public resources are tightening?
- What steps are needed at central
level, to ensure continued accountability to Parliament for public
funds, while allowing some scope for redeployment at local level
where councils and other agencies agree on such a requirement?
- When organisations work together,
how will lateral accountability be achieved?
- Should there be a single finance
officer, or group of officers, providing democratically accountable
decision-making?
- At the central level, how will
questions of accountability to Parliament in a more devolved era
be addressed?
- How should the Community Budgets
be pooled?
Our inquiry: the next phase
13. We shall continue to monitor the development
of Community Budgets over the next year. We shall issue a fresh
call for evidence around this time next year when we shall take
further oral evidence and publish a report later in 2013.
1 "Community Budgets", DCLG website, www.communities.gov.uk/localgovernment/decentralisation/communitybudgets/
Back
2
"Letter from Sir Bob Kerslake about Community Budgets",
DCLG Circular and official letters, 28 July 2011, www.communities.gov.uk/publications/localgovernment/kerslakecommunitybudgets Back
3
"Tackling troubled families", DCLG Press Notice, 15
December 2011 Back
4
"14 areas get 2012 starter gun to 'pool and save' billions",
DCLG Press Notice, 21 December 2011 Back
5
DCLG, Community Budgets Prospectus, October 2011, p 19 Back
6
"Community Budgets", DCLG website, www.communities.gov.uk/localgovernment/decentralisation/communitybudgets/
Back
7
HC Deb, 10 January 2012, col 1WS Back
8
Two of these councils are part of the 16 council pilot schemes.
The 16 pilot areas were chosen because they were seen as having
strong local relationships involving local communities, and the
public and private sectors. They are: Birmingham; Blackburn with
Darwen; Blackpool; Bradford; Essex; Greater Manchester (a group
of 10 councils); Hull; Kent; Leicestershire; Lincolnshire; the
London Boroughs of Barnet, Croydon, Islington, Lewisham, the single
grouping of Westminster, Hammersmith and Fulham, Kensington and
Chelsea, Wandsworth; and Swindon. Back
9
"Troubled families", DCLG website, www.communities.gov.uk/communities/troubledfamilies/ Back
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