Eric Pickles regards it as ‘the future for public services.’ The DCLG secretary thinks local areas should ‘think big’, and it’s ‘time to let local areas grow up and do things their way.’
Mr Pickles was referring this week to the community budgets pilots which officially launch on Friday. For those of us who believe that innovation in local government did exist before last year’s general election, the community budgets concept has a familiar ring. It used to be called Total Place, which also had pilots, and, indeed, after the pilots reported their findings, a whole programme of action was outlined in detail in the March 2010 Budget, and then disappeared into Whitehall’s filing system.
The problem, of course, is that Total Place was so last year, or at least so last government, and therefore, dropped by the coalition. A few months later, the new ministers decided actually it was quite a good idea after all, and resurrected it, though the words Total Place were banned, and replaced by the much more clumsy-sounding community budgets.
Still, that’s politics, and while momentum was lost, the idea of joining up spending programmes locally still remains not only a very good idea but as Mr Pickles said, the future. There is still far too much time, energy and resources wasted on overlapping agencies, and the pilots are right to focus on problem families which suck in huge sums of public money, often with very little result.
Mr Pickles is also right to say local areas should do this themselves, and it is dispiriting to see how many of the original Total Place pilot areas have failed to follow the logic of their own conclusions, once the Government’s attentions turned elsewhere. We do not need endless, DCLG-inspired pilots. If they believe in them, councils should pursue community budgets/Total Place themselves.
However, it is also true that councils need the Government to order the relevant Whitehall departments to co-operate.
Total Place had commitment at Treasury and Cabinet level. Mr Pickles needs to ensure his Cabinet is now fully behind community budgets or, instead of being the future, they will become just another failed initiative.
Wednesday 30 March 2011
Wednesday 23 March 2011
'Opening up' paper remains firmly shut
Years ago, in 1989, while attending a seminar at the Institute of Economic Affairs, then the intellectual power-house of Thatcherism, I recall being struck by how its disciples, having opened up local government to market forces, now regarded the NHS as the next big challenge. In the end it was too big even for the IEA.
Fast-forward 22 years, and a Conservative prime minister is grappling again with the same subject, namely, how to bring the private sector into the NHS. And like his predecessors, David Cameron is finding it problematic.
Ostensibly, his much-trailed Open public services White Paper has been delayed until after the May local elections, because of international events. In fact, it is delicate negotiations over the degree of private sector involvement in the NHS and welfare, and how these are to be operated and monitored, which is causing the hold-up.
Mr Cameron has been much exercised by Tony Blair’s comments in his autobiography that he regretted not being more radical about public sector reform. The present PM believes it is unfinished business but he, like his predecessors, is finding it more complex than first envisaged, especially when dealing with the NHS.
Paradoxically, although local government has been bearing the brunt of cuts this year, the sector has been traditionally well advanced in the plurality of its service provision. So, rather than trying to bring in more large-scale private companies to an already-mature market, Messrs Cameron and Pickles instead are keen to open councils up to social enterprises and small private operators. Mr Pickles’ not unexpected announcement to the CBI this week that the two-tier code in local government would go was aimed not at the big half-dozen strategic suppliers but the social enterprise market.
Perhaps this explains the surprise comments to an LGA seminar last week by the otherwise-Blairite Hazel Blears, that social enterprises were merely a stalking horse for full-scale privatisation.
With local elections looming, Labour set for big gains and the Cameron White Paper stuck in the post room, we may well find the 1980s battleground of private v public making a repeat appearance.
Fast-forward 22 years, and a Conservative prime minister is grappling again with the same subject, namely, how to bring the private sector into the NHS. And like his predecessors, David Cameron is finding it problematic.
Ostensibly, his much-trailed Open public services White Paper has been delayed until after the May local elections, because of international events. In fact, it is delicate negotiations over the degree of private sector involvement in the NHS and welfare, and how these are to be operated and monitored, which is causing the hold-up.
Mr Cameron has been much exercised by Tony Blair’s comments in his autobiography that he regretted not being more radical about public sector reform. The present PM believes it is unfinished business but he, like his predecessors, is finding it more complex than first envisaged, especially when dealing with the NHS.
Paradoxically, although local government has been bearing the brunt of cuts this year, the sector has been traditionally well advanced in the plurality of its service provision. So, rather than trying to bring in more large-scale private companies to an already-mature market, Messrs Cameron and Pickles instead are keen to open councils up to social enterprises and small private operators. Mr Pickles’ not unexpected announcement to the CBI this week that the two-tier code in local government would go was aimed not at the big half-dozen strategic suppliers but the social enterprise market.
Perhaps this explains the surprise comments to an LGA seminar last week by the otherwise-Blairite Hazel Blears, that social enterprises were merely a stalking horse for full-scale privatisation.
With local elections looming, Labour set for big gains and the Cameron White Paper stuck in the post room, we may well find the 1980s battleground of private v public making a repeat appearance.
Wednesday 16 March 2011
The Huttons on pay and pensions
It was canny of ministers to hire the two left-of-centre Huttons to deliver the obvious but highly sensitive conclusions over the future of public sector pay and pensions. The fact they attracted criticisms from both unions and employers, and from left and right, showed they must be doing something right.
Lord Hutton’s report on pensions last week was well trailed and drew predictable criticisms from unions even though there are those who would argue that a retirement age of 68 ‘over time’ is still unaffordable.
Will Hutton’s hefty inquiry into top pay that followed this week was duly slated by unions for not going far enough to curtail senior packages, a verdict supported by sources close to Eric Pickles who insisted that as regards ‘fatcat-bashing’ it will be business as usual. A more ludicrous comment came from the CBI which would have us believe that shareholders in private firms actually have influence over the setting of eye-watering pay at the top of plcs – and that the equivalent in the public sector, the government, should therefore have the final say.
Will Hutton’s report, while recognising that top public sector salaries have indeed soared in recent years, also laid a few old chestnuts to rest, like linking top pay to the notional salary of the Prime Minister, or believing that if only public sector top jobs could be scrapped then frontline services would be safe. Of the country’s top 1% of earners only £1 in every £100 is earned by public sector employees.
But aside from insisting on more performance-related pay Hutton was light on detailed solutions partly because there are no simple answers to what is a complex issue. Top salaries increased for a variety of reasons, not least to do with the late CPA inspection regime, the dwindling pool of talent, and the reluctance of ‘upper tier’ councillors to take risks with candidates not already proven as heads of similar authorities.
While the pay of new entrants is heading downwards, a wave of retirements and reluctance of chief officers to take on the hotseat at the top will again drive up packages. It is after all the law of the market.
Lord Hutton’s report on pensions last week was well trailed and drew predictable criticisms from unions even though there are those who would argue that a retirement age of 68 ‘over time’ is still unaffordable.
Will Hutton’s hefty inquiry into top pay that followed this week was duly slated by unions for not going far enough to curtail senior packages, a verdict supported by sources close to Eric Pickles who insisted that as regards ‘fatcat-bashing’ it will be business as usual. A more ludicrous comment came from the CBI which would have us believe that shareholders in private firms actually have influence over the setting of eye-watering pay at the top of plcs – and that the equivalent in the public sector, the government, should therefore have the final say.
Will Hutton’s report, while recognising that top public sector salaries have indeed soared in recent years, also laid a few old chestnuts to rest, like linking top pay to the notional salary of the Prime Minister, or believing that if only public sector top jobs could be scrapped then frontline services would be safe. Of the country’s top 1% of earners only £1 in every £100 is earned by public sector employees.
But aside from insisting on more performance-related pay Hutton was light on detailed solutions partly because there are no simple answers to what is a complex issue. Top salaries increased for a variety of reasons, not least to do with the late CPA inspection regime, the dwindling pool of talent, and the reluctance of ‘upper tier’ councillors to take risks with candidates not already proven as heads of similar authorities.
While the pay of new entrants is heading downwards, a wave of retirements and reluctance of chief officers to take on the hotseat at the top will again drive up packages. It is after all the law of the market.
Wednesday 9 March 2011
A gift horse for council tax
This year’s council tax for 2011/12, is not actually a ‘freeze’ but a 2.5% increase, funded centrally.
Using the old adage that it is never wise to look a gift horse in the mouth, those councils which do will rapidly realise that their tax base has been eroded to the extent of whatever increase they might have imposed, had it not been for the bung from the Government, meaning councils’ tax base in 2012/13 will be the same as 2010/11.
Nor is there much science about it. If a council freezes its council tax, it will receive a grant equivalent to a 2.5% increase in its 2010/11 Band D figure. Anything above a freeze negates that grant, so a council would need to be pretty foolhardy to ask its residents to cough up when the Government had been so generous.
Had it not been for the £650m bung, what would have been the likely increases? It is fair to say that most councils – as they did last year – would have tried to stick to about 2.5%, even though this is below inflation.
They are well aware of the difficulties their residents face, and there are also local elections in 280 councils in May. In Wales, where there has been no central funding – but also assembly elections – rises are 3%, so little different than in England.
Of concern, however, is what happens next year, and whether chancellor George Osborne will be prepared to cough up another £650m to prevent rises.
In the past, council tax rises provoked a tug of war between central and local, as our columnist Nick Raynsford will testify from his time as local government minister under Tony Blair – although Mr Osborne, as he showed by putting up VAT, is not himself averse to the idea of raising taxes.
His £650m bung to keep council tax at standstill has certainly averted a major public relations disaster this year, both for the coalition and for local government.
To have services cut and council tax increased at the same time would have been a bridge too far for the public. But long-term questions about funding local services, especially in the light of soaring care bills, remain so far unanswered.
Using the old adage that it is never wise to look a gift horse in the mouth, those councils which do will rapidly realise that their tax base has been eroded to the extent of whatever increase they might have imposed, had it not been for the bung from the Government, meaning councils’ tax base in 2012/13 will be the same as 2010/11.
Nor is there much science about it. If a council freezes its council tax, it will receive a grant equivalent to a 2.5% increase in its 2010/11 Band D figure. Anything above a freeze negates that grant, so a council would need to be pretty foolhardy to ask its residents to cough up when the Government had been so generous.
Had it not been for the £650m bung, what would have been the likely increases? It is fair to say that most councils – as they did last year – would have tried to stick to about 2.5%, even though this is below inflation.
They are well aware of the difficulties their residents face, and there are also local elections in 280 councils in May. In Wales, where there has been no central funding – but also assembly elections – rises are 3%, so little different than in England.
Of concern, however, is what happens next year, and whether chancellor George Osborne will be prepared to cough up another £650m to prevent rises.
In the past, council tax rises provoked a tug of war between central and local, as our columnist Nick Raynsford will testify from his time as local government minister under Tony Blair – although Mr Osborne, as he showed by putting up VAT, is not himself averse to the idea of raising taxes.
His £650m bung to keep council tax at standstill has certainly averted a major public relations disaster this year, both for the coalition and for local government.
To have services cut and council tax increased at the same time would have been a bridge too far for the public. But long-term questions about funding local services, especially in the light of soaring care bills, remain so far unanswered.
Wednesday 2 March 2011
Cuts to the third sector
The scale of spending reductions to local government and the way they are front-loaded means not only cuts to frontline services but also cuts to whatever can easily yield immediate savings in time for the 2011/12 financial year.
This is almost certainly neither sensible nor strategic but, in the short timeframe between the grant settlement in December and the new year in April, there is little else.
Inevitably, the voluntary sector has been hit, but some of these groups seem to live in another world where the budget deficit passes them by, leaving their funding untouched. They are part of the public sector and the public sector is being cut, irrespective of fairness. As The MJ’s front page story shows, cutting all managers’ salaries and back offices would still not avoid the need to cut frontline services.
However, local authorities operate in a political climate, and cuts to voluntary sector funding are doing them no favours whatsoever in the corridors of Westminster. Such cuts – some of them clumsy – have severely embarrassed the Government by turning Big Society into an apparent sham. Ministers do not like being left with egg on their faces.
In his address to the voluntary sector, Mr Pickles this week reflected this fury at local government by warning he would use unspecified powers to force them to stop making ‘disproportionate’ cuts to voluntary groups.
Much more ominous was his comment that councils would be judged on their relationship with their local voluntary sector, ‘a key test of whether councils are ready for independent, responsible leadership.’ In other words, like many secretaries of state before him, Mr Pickles is discovering that councils have an irritating habit of doing their own thing, irrespective of government policy and that maybe, after all, centralism has its advantages.
The voluntary sector has a key long-term role earmarked in local service delivery, irrespective of the cuts. Mr Pickles’ view that localism means councils passing on powers to the third sector will have been only increased by the recent Big Society cuts row.
Councils have often had little choice in cutting grants to voluntary groups. But in a harsh political climate, the damage has been as much to their own reputation and lobbying power as to the third sector.
This is almost certainly neither sensible nor strategic but, in the short timeframe between the grant settlement in December and the new year in April, there is little else.
Inevitably, the voluntary sector has been hit, but some of these groups seem to live in another world where the budget deficit passes them by, leaving their funding untouched. They are part of the public sector and the public sector is being cut, irrespective of fairness. As The MJ’s front page story shows, cutting all managers’ salaries and back offices would still not avoid the need to cut frontline services.
However, local authorities operate in a political climate, and cuts to voluntary sector funding are doing them no favours whatsoever in the corridors of Westminster. Such cuts – some of them clumsy – have severely embarrassed the Government by turning Big Society into an apparent sham. Ministers do not like being left with egg on their faces.
In his address to the voluntary sector, Mr Pickles this week reflected this fury at local government by warning he would use unspecified powers to force them to stop making ‘disproportionate’ cuts to voluntary groups.
Much more ominous was his comment that councils would be judged on their relationship with their local voluntary sector, ‘a key test of whether councils are ready for independent, responsible leadership.’ In other words, like many secretaries of state before him, Mr Pickles is discovering that councils have an irritating habit of doing their own thing, irrespective of government policy and that maybe, after all, centralism has its advantages.
The voluntary sector has a key long-term role earmarked in local service delivery, irrespective of the cuts. Mr Pickles’ view that localism means councils passing on powers to the third sector will have been only increased by the recent Big Society cuts row.
Councils have often had little choice in cutting grants to voluntary groups. But in a harsh political climate, the damage has been as much to their own reputation and lobbying power as to the third sector.
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