Mutual and co-operative approaches to delivering local services - Communities and Local Government Committee Contents

7  Conclusion

92. In its evidence the Local Government Association considered that an increased interest in mutuals had been driven by the "emphasis on the role of civil society and the provisions put in place with the Localism Act 2011, combined with cuts in local authority budgets and the knock-on effect on front line services".[150] But this is only part of the story, as we have noted two government policies are stimulating local authorities to consider how mutuals and co-operatives might deliver local services. As well as the Localism Act 2011 which gives those working within local authorities and local people a right to bid for services which they could then run as a mutual or co-operative, the Government wants to open up services across the entire public sector and it sees employee-owned mutuals as instrumental to achieving this change. Delivering local services through mutuals and co-operatives would fulfil both these policy objectives and would embody the Government's ambition for the 'Big Society'.

93. Additionally, the economic downturn and the severe constraints on budgets across the public sector mean that local authorities are under pressure to look for new ways to deliver services. The supporters of mutuals and co-operatives are clear that they offer scope not only for improved efficiency but more responsive services underpinned with local accountability and engagement. As the Government put it, they "increase trust and confidence in public services and local democracy".[151] But the economic downturn is a double-edged sword. There is no money for pump-priming and local authorities are cautious about putting resources into untried arrangements.

94. Mutuals and co-operatives providing local services are not being set up in significant numbers. From the small number of mutuals and co-operatives in the local government sector the evidence is encouraging but it not sufficient either to demonstrate conclusive improvements in service or that savings can be made or that benefits in engagement and accountability will follow. The necessary critical mass will be slow to build up without more and better support. The Government has a choice, if it wants more mutuals and co-operatives to develop: it must take action to provide support. Without additional assistance it seems likely little will happen. Our recommendations aim to encourage a joined-up strategy for the collection of evidence and dissemination of best practice and tested models and to break down the barriers currently holding authorities back. The Government needs to implement these urgently if it wishes to encourage more authorities to take an interest in mutual and co-operative working.

150   Ev 145, para 4 Back

151   Ev 134, para 7 Back

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Prepared 6 December 2012