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UK local government needs a radical rethink says MCA Think Tank

Manchester Town Hall

London: A new MCA Think Tank report released today says the future of local government needs a radical rethink early in the new Parliament — to define what councils are for, what functions best suit them, and what should be undertaken by others.

The report, Local Government — Time for Reinvention, is based on the views of the UK's leading consultants — experts in local government — working with councils the length and breadth of the country. The Think Tank puts forward 17 recommendations covering areas such as Getting Localism Right, Digitisation, Demand Management, and Leadership.

The Think Tank says local government has endured a disproportionate share of austerity. Councils have absorbed substantial cuts. Apart from isolated examples, they have done well. The widely predicted local government "crisis" has not emerged. But far greater cuts are anticipated in the next Parliament. Central government support to councils may disappear altogether. Many authorities will struggle to survive in their current form. This calls for a radical reinvention of how councils work.

Getting Localism Right requires a proper examination of what councils are for. Many people, including those well informed about politics and public services, lack a detailed understanding of what councils actually do. The Think Tank therefore recommends that a major National Public Conference on local government featuring representatives from local and central government and wider civil society should take place to define councils' roles and examine radical options for reform.

Paul Connolly, Director of the MCA Think Tank, and author of the report, said: "We need to define what local authorities are for — then reinvent them for the 21st century. This template of 'what good looks like' would be used as a standard against which to judge local government reform proposals. These will include additional devolution to councils — and more importantly to citizens themselves — as well as service sharing, inter-agency working and other forms of consolidation.

"The Conference would help define the scope of local authorities, what they are effective at, what new responsibilities they could take on, and what they should relinquish. Proposals such as the 'Manchester model' could then be assessed against this vision."

Going beyond devolution of services

Radically, the report also suggests that localism should go well beyond devolution of services to councils. Where communities wish to take on service delivery responsibility themselves, they should have the option to "opt out" of council delivery structures and create their own "free services". This approach should not be restricted to geographic communities, as the Digital Age citizen increasingly lives and works in ways that are not easily bounded by a single place. The proposed Conference could examine whether other forms of citizen involvement are needed to reflect the changing demands and requirements of modern life.

The report also suggests more immediate opportunities for reform. These recommendations can be implemented without radical overhaul of structures, and include:

  • Digital — Digitisation can help local government save money, reinvent services and recast the relationship between the citizen and the state. Councils and other agencies should go further in exploring Digital capabilities, potentially in collaboration with each other and with other agencies. Digitisation could be deployed more widely to support and improve service self-management in areas such as social care. Councils and government will need to work together to ensure that local government has the skills and capability it needs to make the most of Digital opportunities.
  • Effective Demand Management: Can transform local services — An essential route to efficiency in local services is managing demand, but local authorities have traditionally managed demand by restricting eligibility for services or cutting back provision. By taking a more imaginative look at service users, deploying behavioural analysis and not just the traditional assessments of socio-economic need, councils can segment and tailor services in ways which may see reduced levels of demand. Sandwell Council took this approach and managed to reduce inappropriate demand for social care services, resulting in the council having the lowest re-referral rate in the country in 2014.
  • Leadership: time for a culture of risk-taking and entrepreneurship — Local authorities are doing well in leadership compared to other similar sectors. But they could do better still if the issue of leadership calibre was more effectively addressed. The authors recommend that councils should resist the temptation to reduce training and development budgets. However, to ensure that they secure value for money, training courses should be audited against current demands, such as the need for partnership working, community engagement, and Digital skills.

Emma Cornwall of Hay Group, a contributor to the MCA Think Tank and expert on leadership, added: "We have a cohort of leadership coming through local government now who could do better. But they are being crushed by the system and by their own slightly parochial concerns. So, when encouraged to take risks, they do not necessarily know what that means, and they want the cover of a process. They're not being helped as many current forms of leadership programmes don't work."

Sharing risks and improving standards

The report also argues that external service companies will remain extremely important to the delivery of effective local services. However, the Think Tank believes that these providers could do more to share the risks of service transformation with councils and work harder to secure the benefits of the services within the communities they serve. The report recommends that suppliers should be subject to the same standards of public service ethics as local government employees, and proposes a single standard for all those involved in delivering local services. To lead the way, the MCA, as part of its current work to promote excellence in consulting, will consider a new set of binding standards for all its members working in the public sector.

Alan Leaman, Chief Executive of the MCA, concluded: "The next Parliament will be make or break for local government. This MCA Think Tank report draws on the insights, specialist knowledge and advice of a large number of the leading management consultants who work with local government clients. Our members are committed to seeing the highest standards in public services generally and have come up with a mix of pragmatic and radical proposals for reform of local government.

We hope our call for a National Public Conference on local government to take place early in the next Parliament stimulates a much needed debate. Councils' remits are an accumulation of centuries of legislation, reorganisation and custom and practice. As a nation, we need to decide what they are for in the 21st Century and how they can be effective in an age of rising expectations and diminishing resources."

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