Memorandum from Lancashire County Council
EXECUTIVE SUMMARY
Decentralisation and place-based budgeting promise
significant improvements for the sector but success will demand
tough choices on service integration and the "right"
spatial footprint.
Localism will be either propelled or proscribed by
the quality of local political leadership. The public must be
assured of clear lines of prioritisation and accountability for
service delivery, backed by national minimum standards.
Whitehall should focus on its policy role. Establishing
commissioning frameworks, investing in sector advice and support,
and offering new accountability models for councils will be vital.
CONSULTATION QUESTIONS
1. The extent to which decentralisation leads
to more effective public service delivery; and what the limits
are, or should be, of localism
1.1 Lancashire County Council believes in decentralisation
and accepts that services can improve if shaped by greater local
knowledge, insight and management. So long as nationally-prescribed
minimum standard ensure a floor-level standard of service, services
do not need to be delivered on a national model. Councils are
democratically accountable to the people and can prioritise the
allocation of diminishing resources accordingly.
1.2 We've proved that localism works by devolving
power downward to parishes and town councils (backed up
by a set of agreed actions) and work with city and borough councils
in Lancashire to identify policy areas where shared or combined
services could be viable. Individual district councils can express
interest in a specific, programme-based policy area—like
our "public realm" pilot—and work with us to tailor
local delivery to local demand. Many of our own councillors stress
the differences between different parts of Lancashire and we have
worked hard over the last eight years to develop an integrated
and yet flexible approach based on the specific needs of districts.
1.3 Where we differ from traditional localists
is that we do not underestimate the public's appetite for strong
geographical equity, defined as the same or similar services or
level of entitlement from one place to another. It may well be
that, under a more localist system, varying levels of provision
or service design would be a pure function of political choices
which lead to better outcomes due to a locality's particular socio-economic
needs or history compared with another's. But localists must take
seriously the potential for intense media and public criticism
(and its longer-term effects) if service provision falters. Sizeable
sections of the media and public remain largely unaware or unconvinced
of performance improvements made by councils over the last 10
years and have come to expect uniform provision, especially in
health care (eg drug availability), an area where place-based
working promises the biggest rewards.
1.4 Councillors and ministers must both be clear
with the public where the buck stops. So, in addition to winning
hearts and minds, localists must offer strong local leadership
that is responsible—and seen to be responsible—for
local performance as a strong counter weight to the media's obsession
with "postcode lotteries". Seen this way, the limits
of localism lay in the capacity of the localist political class
and its attendant bureaucracy, which may prompt a debate about
the Coalition's government's plans for referenda on elected mayors
in England's biggest cities. As there is currently no guarantee
of effective local leadership, localists must be attuned to calls
to strengthen political leadership on the local level at the expense
of "managerialism" and excessive audit regimes. Ultimately,
the effectiveness of decentralisation will be either propelled
or proscribed by the quality of local political vision and the
resources allocated to local control.
2. The lessons for decentralisation from Total
Place, and the potential to build on the work done under that
initiative, particularly through place-based budgeting
2.1 In principle, Place-Based Budgeting promises
to use local knowledge flexibly and target policy interventions
at the most appropriate level. Tallying the totality of public
investment into an area—not a new idea in Whitehall—clearly
illustrates the reach of the state and identifies costly duplications
of effort or the well-known market failure of "split incentives".
As policy makers improve their understanding of the myriad inter-connected
drivers of socio-economic outcomes, it becomes clearer why the
strategic commissioning of health services for the disabled and
elderly need to be devolved to consortia of place-based agents.
Housing providers now work with the National Health Service where
housing quality has been shown to be a factor in poor health,
and the health service has a role in getting long-term incapacity
benefit recipients back into work. In perhaps the clearest example
of the "win-win" promise of Total Place, PCT managers
in Durham approved a contribution towards winter footpaths, reducing
the number of falls and their cost to the NHS.
2.2 But the promise of Total Place goes beyond
"counting" resources into an area: We must be sensitive
to the scale and contours of the "place" itself, how
its internal characteristics behave compared with other places
and the specific demands of different policy issues when applied
on varying scales (early interventions on a neighbourhood-scale,
for example, with issues like transport and economic development
on a larger footprint) or across the spectrum of wealth and well-being.
2.3 Implementation, therefore, is tricky. Different
incentives and rewards for different parts of the public sector
bedevil partnership working beyond the immediate municipal sphere
and complicate efforts to join up with the NHS or Department of
Work and Pensions. Moving to genuine pooled-resource arrangements
poses stiff challenges, like co-ordinating different budgetary
cycles and financial and accounting regimes. Variations in training,
performance monitoring and other work practices must also be considered.
3. The role of local government in a decentralised
model of local public service delivery, and the extent to which
localism can and should extend to other local agents
3.1 Currently, councils both commission and
provide local services. In a decentralised model, councils will
have to work harder to show that any services that they continue
to offer meet exacting "value for money" standards.
Central government may yet have a role in delineating the responsibilities
of councils as commissioners and providers of local services,
perhaps via the formation of national minimum standards.
3.2 Whether councils out-source delivery or not,
they will still be responsible for monitoring performance. In
the case of children's services or care for vulnerable adults,
councils will not only remain accountable for delivery but may
well find that localised regulation will actually increase as
councils micro-manage providers in a politically sensitive area.
These scenarios undermine some of the localist arguments welcoming
the demise of national performance management regimes in favour
of a local "enabling" or "commissioning" role.
3.3 Localism means defining the geographic point
where performance and cost intersect. Local government's role
lies in selecting the right level of subsidiarity—choosing
the appropriate spatial footprint and attendant public agencies—and
managing the resulting diversity of agents with a simple, flexible
approach that decides where and how. We are using
this approach in our talks with district and parish councils;
our "devolved services protocol" works on a programme
basis which is flexible and inclusive as units of local government
below the county council can self-select how and where they get
involved (this kind of tailoring evades issues that, in a two-tier
area, can bog down service delivery when more comprehensive agreements
are sought). It is also important to consider how many upper-level
authorities worked in recent years with other public agencies
through Multi-Area Agreements (MAAs), many of them imbued with
this kind of localist thinking. While now defunct, the footprints
of MAAs and their (in our case, relatively loose) governance arrangements,
offer a starting point to build spatially-aware models of decentralisation
and cross-agency co-operation.
4. The action which will be necessary on the
part of Whitehall departments to achieve effective decentralised
public service delivery
4.1 Whitehall departments are not set up to be
delivery vehicles and criticisms of this "silo" culture
are a tenet of localist doctrine (a review of the coalition government's
draft structural reform plans demonstrates the lack of co-ordinated
thinking across departments). In policy areas of national concern,
local government needs Whitehall to be clear on outcomes regarding
what local agents should address but not prescriptive about
how they tackle specific priorities in their area. Place-based
agencies must also have the latitude to decide on local priorities
themselves and negotiate on those priorities with the centre.
Whitehall should then develop broad minimum standards of provision,
offer a limited safeguarding role and facilitate local government's
commissioning and accountability roles through professional training,
guidance and support. In this way, councils could become the executive
agencies hitherto used by Whitehall departments to implement policy.
5. The impact of decentralisation on the achievement
of savings in the cost of local public services and the effective
targeting of cuts to those services
5.1 The Total Place pilots demonstrated
the potential for savings through integrated decentralisation.
But asset rationalisation and shared or uniform services are just
the start. Higher up the value chain lie the real prizes of decentralisation,
in terms of savings, whereby closer agency interaction with customers
can identify demand, streamline interventions and target delivery.
As before, the key skill is identifying the appropriate level
of intervention, then empowering and incentivising public agencies
to collaborate.
5.2 It is generally assumed that the dynamism
of decentralisation is somehow more efficient than the current
model—because agencies pool their budgets and knowledge
to tackle issues in ways appropriate to local conditions. But
the Total Place Pilots did not sufficiently test whether decentralisation
would create greater flexibility to respond to these conditions
(eg substance abuse delivery in rural areas, or areas with significant
homeless populations). Localist arguments may require more robust
evidence to counter claims that centralisation generates economies
of scale and is therefore inherently more efficient. There is
also no clear evidence that decentralised, devolved systems would
better target cuts. An obvious objection is that this would bring
narrow self-interests to the fore and disadvantage the less "sharp
elbowed" amongst us, leaving the most vulnerable and least
vocal out in the cold. Localists must address these arguments
through the provision of clearly understood threads of local accountability.
6. What, if any, arrangements for the oversight
of local authority performance will be necessary to ensure effective
local public service delivery
6.1 Councils across the country must respond
to the crisis of faith in public institutions. Lancashire County
Council, the fourth largest authority in the nation, was among
the first to webcast Full Council and committee meetings. Council
portfolio holders regularly go before the public through our popular
"Cabinet Question Time" programme. We regularly publish
performance data and are looking at real-time provision of service
information to the public.
6.2 Coalition plans to expand the amount of municipal
data provided to the public is welcome in this regard, although
it has not been proved that this will lead inevitably to a revolution
in citizen habits. The "wisdom of crowds" model requires
significant public engagement and, especially early on, other
accountability mechanisms must be deployed alongside citizen-driven
scrutiny. There will also be significant variances in the type
and quality of information provided, linked to the differences
in size, capacity and population across the UK's complicated council
map.
6.3 As suggested by the Local Government Association
and others, policy makers could look at an expanded Duty to Cooperate,
increased powers for Overview and Scrutiny committees, including
an examination of limited local subpoena powers, greater use of
participatory budgeting and other mechanisms to boost accountability.
Accountability models should be council-led.
7. How effective and appropriate accountability
can be achieved for expenditure on the delivery of local services,
especially for that voted by Parliament rather than raised locally
7.1 The limited nature of local government's
revenue base means that, in the absence of any reform of the municipal
funding system, Parliament must keep councils accountable for
funds disbursed by Westminster. The Comprehensive Area Assessment,
despite its faults, did provide a nationally consistent approach,
which many feel is still needed for monies approved by Parliament.
The Coalition's intention to conduct a review of the local government
funding system may further illuminate options in this area.
7.2 Given that there is a clear commonality between
local and central government based on their democratic credibility,
it is surprising that, unlike other western democracies, formalised
links between Parliament and local government are not a feature
of UK politics. There is some potential, therefore, for expanding
Parliament's outreach services or Select Committee structure to
include a new improvement and support role for councils in scrutinising
the expenditure of monies approved by Parliament, including joint
council-MP committees. "Big Society" reforms may also
allow for formalised scrutiny of spending by building capacity
within the voluntary sector and bring in parishes, resident associations
and other "little platoons" willing to play a bigger
part in keeping big institutions accountable to everyday people.
Ministers and civil servants, as well as councils, must also clearly
communicate the role and responsibility of local government in
any new approach, which echoes our earlier comments about the
political independence of place-based choices.
October 2010
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