Bill Cooper of KPMG and Ben Lucas of the 2020 Public Services Trust warn that many councils are not yet fully prepared to take on the new responsibilities of place-based budgeting.
In the new public policy environment, all roads are signposted as leading to localism. But they could end up in many different destinations
The LGA has called for place-based budgets, with local control over significant public service spending in areas such as welfare services, policing and public health, as the next step in the Total Place agenda.
Turning Point has been piloting a model for integrating the commissioning of whole family services at neighbourhood level, and citizens are to be empowered to procure the services they require using personalised budgets.
In health, local GP consortia will commission 70% of NHS spend, while in education, local groups of parents are exhorted to set up their own schools receiving their funding direct.
The new Big Society pilots which have been announced will empower local communities and the voluntary sector to run more services, and the spending cuts imposed on local authorities will require consideration to be given to handing service provision to communities or divestment to other organisations.
Local enterprise partnerships (LEPs) are being established to bring together the private sector and local authorities to drive local economic and skills strategies and to replace regional development agencies (RDAs). And local authorities are to be freed from much of the regulatory oversight and inspection regimes of the Audit Commission, as well as being given a new power of general competence.
Hovering ominously over all these divergent strands of localism is the spectre of substantial spending cuts. The overarching imperative for central and local government is to reduce the deficit by cutting public spending. In part, the 57 varieties of localism are all driven by the need to cut spending. But they also reflect the need to get better outcomes for public spending and bring decision-making closer to home.
At the recent LGA annual conference, the 2020 Public Services Trust and KPMG hosted a joint seminar for delegates on how to take forward the agenda for place-based budgets. What emerged from this was a view that the debate urgently needs a combination of realism, clarity and leadership.
The LGA has done a good job of making the case for place-based budgets, and this idea reverberated around the LGA conference. But the proposal has been presented in far too ‘Panglossian' terms, sitting in local government's comfort zone, rather than confronting some of the difficult issues which would need to be resolved if it is to make the transition from paper to reality.
Three specific shortcomings will need to be addressed, if it is to have any chance of working. They are:
