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How can innovation help meet financial pressures?

Can new ways of working along with innovative partnerships and service delivery help alleviate the immense pressure on council finances? The MJ and Norse Group invite leading council chief executives and directors to discuss. Report by Paul Marinko.

It seems safe to suggest that the Covid pandemic changed most people's perspective and the claim is doubly true for councils.

With local authorities across the country now looking to the future, the question is how does a changed world and changed perspectives ease or complicate a council's potential to serve their residents?

This round table event hosted by The MJ and Norse Group explores how innovation is taking centre stage for councils as they face multiple challenges in a radically different environment.

As one participant explains, the pandemic ‘opened the door to innovation', revealing ‘known unknowns. In such an uncertain world innovation has become so important.' It is a comment which resonates with another, who emphasises how their council is increasingly teaming up with neighbouring authorities in areas such as health and social care. ‘It's now about how we innovate together.' As another puts it: ‘For some councils it's about leveraging our size by coming together to create a critical mass.'

A further voice concurs: ‘My council does almost nothing on its own. The idea we can do things on our own does not stack up. There are huge opportunities there. Yet, councils can still be hierarchical and silo-ed and that's dangerous.'

Inevitably, the experience of having no choice but to work closely with partners during the pandemic has provided confidence for councils to continue doing this. Trust has built up and a sense of learning from each other has strengthened.

This has created an environment in which innovation can flourish, with an innovative idea able to be translated to other areas with ease, especially through collaborations with private sector partners.

For one participant, there is a sense of the tide turning in a way that will allow innovation to flourish even more. It is a tide which is taking away a culture for assuming bigger is best and heralding an enthusiasm for partnerships and decentralisation.

Once again, it is a culture that voices around the table agree has been enhanced by the experiences of Covid. The crises of the last few years have emphasised to councils that there is no ‘one size fits all' and local solutions are crucial.

The power of constructive relationships was amplified during the pandemic and councils are ready to embrace the plethora of opportunities this has thrown up to work with and serve communities.

While the need for everyone to embrace the digital during Covid has changed behaviours within councils it has also changed them in communities. The emergence of social media groups blossoming across communities means, as one voice around the table states, ‘there is a real catalyst for change'.

They add that the innovation of the future will be less around change within the organisation but will increasingly be systems innovation across the wider public sector. The pandemic also created agility within council workforces. ‘There was no time to think, we just had to do,' says one participant.

In a post-Covid world it would be thought that things have changed for the better, but huge barriers to innovation remain and little surprise that the first is budgets. For one participant, there is an acceptance that their authority ‘hasn't done innovation well' so far and now it is faced with financial ‘nightmares' that have meant dipping deep into reserves and being left with no resilience. Against this backdrop, another points out: ‘There is a question about how much we can truly do with the resources we have.'

For others it's primarily the lack of certainty over funding that is the particular barrier to innovation, with many looking five years down the line. There is general agreement the prospects for adequate funding look bleak. ‘It's looking very doubtful for the years ahead,' admits one participant. ‘The tsunami of costs is going in one direction.'

With Covid largely in the rear-view mirror, it would be hoped that space and time would have emerged for staff to consider the potential to innovate. But, alongside budgetary pressures, there is the conundrum of increasing workforce and service pressures.

In addition, the pandemic has taken its toll on staff. ‘The organisation is exhausted,' admits one director. They add that, in many cases, staff have got used to having the resources for the challenge after working through Covid. Now they are ‘out of practice' at taking the ‘tough decisions. It's tough taking them on that journey.'

Yet there is a determination to push on with trying to create the space for staff to think innovatively. The constant pressure created by budgets and growing service demand is making it essential. ‘The focus has to be on giving them that space,' says one participant. ‘When they get it, they love it.' But the embracing of flexible working has meant less opportunities for staff to get together and create the communal environment to collaborate and innovate.

A slight difference of opinion emerges around the table when the subject of members arises.

For one, the lesson from the pandemic was that their absence from the command and control requirements meant officers had the space to get things done. For another, the essential democratic nature of councils means local authorities have to face the challenge of including them on the innovation and change journey. And there is a recognition they also have plenty to offer in terms of community connection and the ability to focus on specific outcomes.

Yet the real challenge to innovation from the political nature of councils is the limited timescale of the election cycle. One officer admits this creates a tension with innovation which can take longer than four years to bear fruit. There is also a weary recognition that members often lack interest in innovation because they are only interested in getting re-elected. One voice points out they worry because innovation can be perceived by residents as things being taken away. ‘They know that talking to a bot rather than a person will lead to complaints,' says the participant.

Yet despite the challenges and restrictions, there remains a commitment, enthusiasm and confidence among participants about the prospect and potential for council innovation.‘Why don't we talk about the innovation we do?' asks one director who argues that councils top the league among public sector organisations for giving staff the opportunity to try things, so the potential exists.

Another points to the example of councils moving at speed to get grants out to businesses during Covid. ‘There's a lot to learn from that,' they add. ‘To get innovation like that in the future we need to remove the fear factor.'

And while the experience of Covid has revealed the potential for council teams to work with agility, collaborate with confidence with partners and cede control, it has also proved there is an abundance of functions that can stop for two years without great consequence.

As one participant points out, this is where councils have the potential to find space for innovation. And it's a possibility they are eager to take up. Above all, while the budget, workforce and service pressure may create barriers to innovation they also serve to demonstrate the absolute need for it.

And the pandemic may have left councils feeling like they have nothing left in the tank in order to exercise their innovation muscles but it has also proved – when push comes to shove – there is no shortage of inspirational thinking within local authorities.

Comment: Norse

Why exchanging ideas and open discussion like The MJ/Norse round table are increasingly important, says Norse chief executive Justin Galliford.

With local government under severe financial pressure after 15 years of relentless challenges, I believe that having the opportunity to talk openly about how councils and their service providers can work together to deliver value to communities is more important than ever.

This is why I value the round tables which The MJ organises so highly. They give everyone present the chance to air their views on the state of local government, and discuss how they are responding to the challenges; to find out what other authorities are doing; and to contribute to the wider debate.

This round table, held in March, covered a subject which I believe is the top priority for many councils – can new ways of working help alleviate the budgetary pressures resulting from the inexorable tide of difficulties dating back to austerity, through the pandemic, and now the cost of living crisis.

With more than 20 local authority joint ventures across the UK, delivering a wide range of services from waste collection to property services and FM, Norse Group is well placed to observe the challenges faced by councils every day. I believe that working together, with the focus firmly on the needs of communities, is the key to success. Our partnership model has been leading the way for over 20 years, and I am enormously proud of the work that we do to improve people's lives.

Attendees:

Georgina Blakemore, chief executive, Epping Forest DC

Michael Coughlin, executive director partnership, prosperity and growth, Surrey CC

Mike Curtis, executive director, Kensington & Chelsea RLBC

Anisa Darr, executive director of strategy and resources, Barnet LBC

Patrick Flaherty, chief executive, Harrow LBC

Mark Green, director of finance, resources and business improvement, Maidstone BC

Simon Parker, director of policy and communities, Cambridgeshire CC

Phil Porter, strategic director, community wellbeing, Brent LBC

Michael Burton, editorial director, The MJ (chair)

Justin Galliford, chief executive, Norse Group

Geoff Tucker, sales and marketing director, Norse Group

Heather Jameson, editor, The MJ

Paul Marinko, rapporteur, The MJ

This article is sponsored content for The MJ

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