5 Integration or fragmentation?
136. It is difficult to discern from the Government's
explanation of its brand of localism how coherent the resulting
system of governance will be, and indeed to what extent the Government
values coherence as an outcome. Local government consultant Henry
Peterson described the difference he saw between 'silo localism',
in which decisions are taken within separate service areas to
devolve responsibility to local level, and more co-ordinated,
'integrated localism'. He argued that the latter "offers
the only long-term route to more intelligent and cost-effective
forms of intervention and prevention by public agencies, along
with better outcomes for citizens".[278]
137. There is a danger that the principle of subsidiarity
is applied by each government department, and that each department
devises its own tools for community empowerment, with no thought
given to how the resulting models relate to each other.[279]
Ed Cox of IPPR North described the cumulative impact of different
departments' decisions to devise their own local engagement mechanisms:
the way in which accountability currently works
from a community perspective is that, because the Department of
Health, for example, says that we have LINks around health provision,
if I, as a member of the community, want to hold my local health
services accountable, I have to go to the LINks meeting on Monday
night. If I have an issue about policing, because the Home Office
says you have to have this form of accountability for local policing
structures, I have to go to the policing meeting on Tuesday night.
Because the council operates in a slightly different way, I need
to then go to the ward co-ordination meeting run by the council
on a Wednesday night. As a local resident, I didn't want to go
to any of those meetings at all, because then it squeezes out
me running my local Cubs group or Scouts group or whatever; I
haven't the time then in the rest of the week to do the things
I actually wanted to do. That is the reality of community engagement
in a highly centralised, highly siloed situation. [...] I know
that every department wants to have its own mechanism of accountability.
What I would argue very strongly is: allow local government to
be the mechanism of accountability for these different services.[280]
138. Several organisations expressed concern to us
about the the potential for various Government localism initiatives
to fragment accountability at local level still further.[281]
Cornwall County Council argued that Health Watch bodies and elected
Police Commissioners, for example, "on the face of it complicate
rather than simplify local democratic accountability."[282]
The potential of GP consortia and Local Enterprise Partnerships
to "confuse local relationships and potentially create delays
and new expensive bureaucracy" was also of concern to the
Centre for Public Service Partnerships.[283]
Neither of these new models is based on local authority boundaries.
LGiU stated that "councils could hardly be blamed for feeling
that, no sooner have geographical boundaries been rationalised
so as to facilitate joint working through virtual co-terminosity
with PCTs, than the whole issue of co-terminosity is up in the
air again."[284]
139. Voluntary sector umbrella bodies told us that
they were wary of operating in "an increasingly fragmented
environment", as reorganisation in various parts of the local
statutory sector disrupted relationships.[285]
The British Retail Consortium also expressed concern about the
prospect of businesses being "compelled to deal with a proliferation
of local agents with responsibility for a wide variety of local
issues" as decentralisation is extended to local bodies other
than councils.[286]
Merseytravel noted the "risk that localism could translate
as a 'free-for-all' or else place one local authority against
another."[287]
Furthermore, there is the prospect of the Big Society, "a
bottom-up and mass localist approach that will lead to a diverse
pattern of service provision and community activity", adding
yet more complexity to the landscape.[288]
140. We put it to the Minister for Decentralisation,
Greg Clark, that the Government's policies could result in greater
fragmentation in local public services. He said:
In our lives we regularly operate in a situation
in which different people are responsible for different things.
As long as you know who they are and you have some relationship
with them and can replace them, or can go elsewhere, then in my
view that is fine. The position we are in at the moment is that
things are done to people without them knowing either who is responsible
for them or, even if they did, being able to do anything about
them.[289]
Total Place and community budgeting
141. The idea of bringing more coherence to local
public service delivery was developed by the last Government largely
on the basis of partnership working, embodied in structures of
varying formality.[290]
Local authorities were supposed to take the lead in and be accountable
for Local Area Agreements concluded with Government, agreements
which nevertheless heavily involved others such as health services
and the police in both the outcomes sought and the inputs that
would be needed. Councils were similarly to the fore in the development
of Local Strategic Partnerships, which are not independent legal
entities with powers of their own, but forums for agreeing common
priorities and actions. While the previous Government asked local
authorities to take on the roles of 'community leaders' and 'place-shapers',
however, these roles were not supported by structural changes
or any greater formal control over the full range of public resources
in their area.[291]
142. Professors George Jones and John Stewart argued
that local authorities should be given powers to allocate resources
to and commission services from other public bodies.[292]
Lancashire County Council suggested that "councils could
become the executive agencies hitherto used by Whitehall departments
to implement policy.[293]
Barnsley Council advocated the idea of local authority-led 'public
service boards' taking responsibility for all services in an area.[294]
This is the logical next step for those who consider that local
authorites' democratic mandate makes them the natural leaders
in each community. Other witnesses, however, stopped short of
recommending that local government be given formal accountability
for other services, but still emphasised how important it was
for those other services to be granted a similar level of local
discretion by Whitehall—including over their finances—so
that they could fully participate in partnerships.[295]
143. Efforts to increase local authorities' influence
have crystallised around the idea of 'place-based budgeting'.
The 2009 Budget launched a project called 'Total Place', in which
thirteen official and many unofficial pilots set out to test the
idea of "local public services working together to deliver
better value services to citizens by focusing on joint working
and reducing waste and duplication".[296]
The pilots started by trying to 'map' the total amount of public
spending within their area. This showed that together, social
security, education and health—areas not under local authority
control—accounted for over 70% of public spending in every
pilot area.[297] They
then went on to consider how this spending could be used more
efficiently while ensuring that the experience of users and residents
was privileged over organisational processes.
144. The Treasury and CLG report on the initiative
concluded that
Total Place has exposed the complexity of the
'internal wiring' of public service delivery. The large number
of individual grants, and poorly-aligned objectives of similar
services across different policy areas, can limit the ability
of delivery organisations to join up services around users. Understanding
where the funding lies and a focus on customers have proved powerful
drivers for change. In concentrating on citizens and outcomes,
rather than on organisation-specific assessments and targets,
local partners in the pilots have increasingly looked beyond organisational
boundaries to develop innovative public services.[298]
The pilots also identified a wide range of potential
savings that could be made by reorganising service delivery on
these terms. The Local Government Association cited several examples,
such as projected savings of nearly £1 billion in the cost
of benefits for young people not in education, employment or training,
and savings of around £5 billion through rationalising public
sector assets.[299]
Following the conclusion of the Total Place pilots, the Local
Government Association went on to publish its own proposals for
a model of "local democratic accountability for local public
services", under the title of 'place-based budgeting'.[300]
145. In evidence to us in September 2010, Secretary
of State Eric Pickles spoke enthusiastically about the ethos of
Total Place and how the Government planned to build on it.[301]
The Government's 'essential guide' to decentralisation states
that
We believe that communities should be able to
combine different sources of public money to create pooled budgets
to tackle difficult cross-cutting issues within an area. These
are known as 'place-based' or community budgets. Next year [2011],
this radical advance in local control over local spending will
be pioneered by 16 areas across the country. We aim to make community
budgets available everywhere by 2013. We will work to allow community
budgeting to encompass as many funding streams as possible—so
that instead of expecting multiple distant bureaucracies to understand
and manage the impact of public spending on so local a scale,
decisions can be made freely and flexibly at the frontline instead.[302]
146. The Comprehensive Spending Review announced
16 'community budgets' pilot schemes, which were due to launch
in April 2011. In contrast to the wide range of policy areas addressed
by the Total Place pilots—from procurement to youth unemployment,
learning disability services to offender management—community
budgets are initially to focus on families with complex needs.
Greg Clark told us that they would be based on the principle that
services should be designed around the needs of individuals, "rather
than try to make our most vulnerable people fall into line with
the structure of central government departments".[303]
147. There is some dissatisfaction with the Government's
approach to the issue of place-based budgets. Cllr Steve Reed,
Leader of Lambeth Council, told us
we should be pushing for this to happen harder
and faster, not least because of the scale of the funding reductions
that we're seeing coming through now. [...] We've had a number
of Total Place pilots. [...] I think we could be a bit bolder
and go faster with this now, and expect it to start to generate
savings that we could learn from elsewhere.[304]
Cllr Richard Kemp, leader of the LGA Liberal Democrat
Group, commented that, while he was satisfied that the Government's
proposals were a good start, "if I thought they were the
end, I would be extremely disappointed".[305]
In December 2010 we put it to the Minister for Decentralisation
that, compared to the broad scope of prior work on Total Place,
the community budgets pilots seemed limited, even timid. He told
us, "you ain't seen nothing yet".[306]
He explained that the pilot phase is intended to discover what
changes will need to be made to central government machinery to
enable national roll-out of the programme.[307]
Will community budgeting fulfil
its potential?
148. The idea of place-based budgets represents a
significant cultural challenge to Whitehall. The LGA said that
implementation of the principles of Total Place would require
engagement from parts of Government that have so far only been
peripherally involved, as well as "a fundamental shift in
the nature of the relationship between central and local government."[308]
Departments will have to come to terms with not being able to
dictate their own, separate accountability mechanisms.[309]
Total Place pilots highlighted how obstructive inflexible budgets
and data-sharing rules can be to joint working.[310]
The NHS Confederation reported the results of a 2010 survey of
PCT Chief Executives and directors of adult social care, which
asked them what factors had helped and hindered the development
of integrated services: with the exception of changing leadership,
the top factors were all nationally-determined, such as performance
regimes and funding complexity.[311]
149. Area-based budgets would have to be the product
of close collaboration between central and local government. NLGN
refers to this as "a single conversation with central government
about money and policy, rather than working through bilateral
negotiations with each individual department."[312]
The Centre for Public Service Partnerships argued that it would
be "a major significant missed opportunity" if place-based
budgets implemented by the current Government were to allow local
authorities only greater discretion over existing local government
expenditure. The proportion of spending within each area which
is still under the direct control of Whitehall is, they contended
"contrary to the principle of localism."[313]
At even a very practical level, however, it may be difficult for
departments to identify how much they spend in a particular locality.[314]
150. So far, the signs about whether the Government
is prepared to tackle the obstacles to meaningful place-based
budgeting are mixed. LGiU noted the Secretary of State's expressions
of support, but identified some mixed messages in what the Government
has actually done so far. The NHS budget is ring-fenced, as will
be public health budgets, and GP consortia will control commissioning
budgets. Substantial amounts of education spend may end up under
the control of autonomous free schools and academies. Police budgets
will be controlled by Commissioners. The Work Programme is being
contracted centrally, but Local Enterprise Partnerships will have
an interest. LGiU concluded that "the logic of these initiatives
goes against the concept of place-based budgets and shared decision-making".[315]
151. LGiU also speculated that the concept may ultimately
pose too much of a challenge to the primacy of traditionally independent-minded
government departments.[316]
Baroness Eaton, Chair of the Local Government Association, commented,
"I am not sure that all parts of Whitehall get it. Health
is beginning to get it more than we ever thought it would, and
certainly education is, but there is a long way to go in other
departments."[317]
Cllr Colin Barrow, Leader of Westminster City Council, said of
community budgets:
I think it will succeed or fail depending on
the qualities of the individuals in central government departments
who are assigned to manage it. As long as these people are revolutionaries
who are interested in seeing whether there is something new that
can come out of this cooperative budget, and seeing whether you
can get better outcomes with less expense—people who want
to actually find out whether this works—it will work. I
know it will work. We've demonstrated it will work. We've published
papers on the subject: it will work. But if the people assigned
to it are minded to keep all this under wraps and make it Yes
Minister, then it won't.[318]
152. The Local Government Association pointed out
that a significant part of the costs associated with the families
who are to be targeted by the community budget pilots are benefit
costs: "The Department for Work and Pensions should therefore
be a major contributor to the community budget—but as yet
there is no evidence of a financial contribution".[319]
We asked the Minister for Policing, Nick Herbert and the Minister
for Employment, Chris Grayling, what contribution their departments
were intending to make to the community budgets programme. Neither
volunteered any information on this point, although Mr Herbert
commented that Home Office involvement "is quite possible".[320]
On the general theme of devolution of budgets, Mr Herbert said
that, in addition to the current policing precept, the budget
for wider community safety responsibilities will be devolved to
Police and Crime Commissioners. He said, "That will be a
real enhancement for local democracy, and in due course we shall
announce the details. [...] I think it is an example of where
we will devolve budgetary decisions when there is a mechanism
for taking those decisions via an elected individual".[321]
153. Social Care Minister Paul Burstow was more forthcoming
about the impact that community budgeting could have on the work
of the Department of Health. He told us that officials in the
Department are acting as 'champions' for the initiative, and that
he anticipated the pilots bringing to light some of the issues
that will need to be addressed by the Government to make a success
of community budgeting. He saw the model being applied usefully
to mental health services, for example. Mr Burstow told us, "The
Department of Health is fully engaged with this because we see
[community budgets] as very much part of how we drive an agenda
of greater integration and collaboration across public services,
which is key to delivering the public health agenda."[322]
154. The Department told us that a 'Community Budgets
Group', chaired by Lord Bichard and bringing together representatives
from Whitehall departments, the local government sector and the
voluntary and community sector will be responsible for driving
progress. 'Whitehall Champions' have been appointed to help resolve
issues within specific departments. Nearly fifty councils have,
according to DCLG, been involved already in discussions with departments
about adopting community budgets in other policy areas.[323]
155. We believe that the type of localism in which
local government is most interested—with good reason—is
that which will allow a comprehensive approach to public spending
and service delivery in any one area. As Total Place showed, this
approach holds out the possibility of services that are both more
efficient and more effective. It would also allow for the streamlining
of local democratic accountability, with the elected local authority
more visibly reponsible for all outcomes in an area. However,
integration of public services at local level does not appear
to be a high priority for the Government. Across departments,
policy developments that may individually be inspired by the ethos
of localism risk entrenching silos rather than enabling creative
responses to local problems. Alternative power and delivery structures
such as GP commissioning, elected police commissioners and free
schools may fragment accountability, and make it more difficult
to corral public resources in any one area into a Total Place-type
vision. We recommend that the Minister for Decentralisation include
in his progress report on the departments an assessment of how
far their individual policies facilitate or inhibit local service
integration.
156. We support the Government's community budgets
programme. Although it seems to us an overly cautious, slow start
to a programme which ought eventually to be revolutionary, we
do not doubt the Government's intention to expand and build on
it rapidly. It is inescapable, however, that the model's success
will depend on the willingness of each government department to
relinquish some control over its own budgets. We are mindful of
criticism of a previous initiative, Local Area Agreements, that
the promise of 'freedoms and flexibilities' to local authorities
to enable them to join up services was realised in only a limited
way.[324] There
is palpable enthusiasm for community budgets on the part of the
DCLG ministerial team, and the Department of Health has also been
praised for its engagement. However, the ministers we spoke to
from the Home Office and the DWP gave the impression not only
of not being so enthusiastic, but of being barely aware that they
might be expected to contribute to such an initiative. We hope
that this does not presage a damp squib. We recommend that the
Government publish regular reports on the progress of the community
budgets programme, specifically the progress that is being made
by individual departments in identifying their contributions,
and how those contributions match up to requests made by local
authorities. This is a crucial programme that demands a great
deal more concrete commitment from government departments than
has thus far been demonstrated. We will take a keen ongoing
interest in this, and expect to question Ministers and officials
on it in our annual consideration of the work of the DCLG. One
issue which may need to be resolved is that, if local authorities
gain through community budgets more control over how central government
funding is spent in their area, this could have the effect of
reducing the proportion of council funding they raise themselves—contrary
to a separate aim of many localists.
157. Greg Clark resisted all invitations to state
what percentage of total Government expenditure at local level
he thought should eventually be under local control, other than
to say that "we can agree that it is more than 10%".[325]
Mr Clark reassured us that it was part of his and his ministerial
colleagues' role "to bang the necessary heads together in
Whitehall" to ensure that resources can be pooled in local
areas.[326] However,
he also indicated that some of the responsibility for making community
budgets work lies with local bodies, and that they should take
the initiative: "the debate is whether you design it from
the top and crash things together so everything flows down to
a local level or whether you give people the right of initiative
locally to do things in a different way. I think there is room
for both".[327]
The Minister told us in December 2010 that the Government was
open to offers about what more local government could take on:
Right across the piece, as I hope will become
apparent during our discussions, we want to say to local authorities
and other groups in the community, 'Come and make suggestions'
[…] I think there should be no limit to their ambition. I
would like them to come forward with suggestions based on joining
up the local agencies, making a proposal to central Government.
If they can make a case that this can be done better than it is
at the moment and that it has a reasonable prospect of better
results, it would be a barmy Government who refused that.[328]
158. Simon Parker, Director of the New Local Government
Network, proposed that the idea of local authorities taking the
initiative with community budgeting could be developed in a way
analogous to the community 'right to challenge' in the Localism
Bill:
We would like local government to be able to
bid to run central services where local government can prove it
can run those services better. […] The way we have started
to think of Total Place is through this idea of a right to bid.
The idea is that local government should be able to bid on behalf
of communities, basically, to get aspects of central government
money. Perhaps that is for Jobcentres and dealing with the problem
of worklessness; perhaps it is for criminal justice, but they
should be able to bid and the Government should have to respond
to that. […] The presumption should be, in line with our
idea of a duty to devolve, that that money will be devolved unless
the Government can make a convincing case for keeping it.[329]
The Minister broadly agreed with this idea, saying
he would like "to extend the principle that people have the
right to do things differently and prevail against a reluctant
bureaucracy. Just as we are establishing that against councils,
I think it should be established against central government."[330]
159. As long as localism remains in the gift of
central government it remains insecure. There is a risk that only
the Department for Communities and Local Government will participate
fully and that other departments will be allowed, to varying degrees,
to ignore the agenda. The Localism Bill contains measures intended
to give communities a right to challenge local authorities that
are reluctant to relinquish power; we were encouraged to hear
the Minister agree in principle that local authorities should
have an analogous right to challenge the centre for services it
believes it can deliver better. We recommend that the Government
develop a process to facilitate this and legislate to give it
effect. There should be a role for Parliament in assessing whether
the local government 'right to challenge' has been properly administered
and we would welcome further discussion with DCLG about how this
could be implemented. One possibility would be to do this
through the establishment of a parliamentary joint committee,
as mentioned above. Any limits which would be set to such a process
would need to be clarified, and justified in terms of localism.
At present it is not clear to what extent the Government will
be able to respond positively if, for example, proposals include
taking more local control of benefits spending.
278 Ev 146 Back
279
Ev 216 Back
280
Q 99 Back
281
Ev 212 Back
282
Ev w133 Back
283
Ev w213 Back
284
Ev 153 Back
285
Q 134 Back
286
Ev 170 Back
287
Ev w5 Back
288
Ev 151 Back
289
Q 518 Back
290
Ev 142 Back
291
Ev 149 Back
292
Ev 142; see also Q 80. Back
293
Ev 251 Back
294
Ev 229 Back
295
Qq 31, Q 187 Back
296
HM Treasury and CLG, Total Place: a whole area approach to
public services, March 2010, p.14 Back
297
Ibid., p.17 Back
298
Ibid., p.19 Back
299
Ev 256 Back
300
Local Government Association, Place-based budgets: the future
governance of local public services, June 2010, p.6 Back
301
Oral evidence, 13 September 2010, HC 453-i, Q 87 Back
302
HM Government, Decentralisation: an essential guide, p.8 Back
303
Q 511 Back
304
Q 47 Back
305
Q 46 Back
306
Oral evidence, 21 December 2010, HC 699-i, Q 40 Back
307
Q 506 Back
308
Ev 255 Back
309
Q 98 Back
310
Ev 158, 234 Back
311
Ev w124 Back
312
Ev 262 Back
313
Ev w213 Back
314
Q 47 Back
315
Ev 152 Back
316
Ev 152 Back
317
Q 381 Back
318
Q 46 Back
319
Ev 261 Back
320
Qq 442-5 Back
321
Qq 424-5 Back
322
Q 470 Back
323
Ev 273 Back
324
Ev 145 Back
325
Qq 507-10, 517 Back
326
Oral evidence, 21 December 2010, HC 699-i, Q 42 Back
327
Q 514 Back
328
Oral evidence, 21 December 2010, HC 699-i, Q 4 Back
329
Qq 368, 379 Back
330
Q 505 Back
|
