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Communities secretary Eric Pickles has provided the strongest indication yet that chancellor George Osborne is ready to introduce place-based budgeting through next month's Comprehensive Spending Review. Mr Pickles told the Commons' CLG select committee on 13 September that the chancellor, who will deliver his CSR on 20 October, is ‘as keen as mustard' on the concept of place-based budgeting, likely to become known as ‘community budgets' under the coalition government. He said the chancellor supported prime minister David Cameron's ambition to devolve large chunks of public funding down through localities to neighbourhood level, although he warned that bespoke neighbourhood funding would take ‘a long time to put together'. Although he did not reveal whether council co-ordinated place-based budgets would be piloted extensively or rolled-out in full next month, Mr Pickles added: ‘I think you might be able to see the very beginnings on the 20th of October.' It follows successful pilots of the former Labour government's Total Place regime last year, when local public sector budgets for a range of services – including local government, health and criminal justice – were merged and decisions about how the cash was spent, and what services were prioritised, were devolved to public managers. The idea is that localities are empowered to tackle public service challenges according their particular area's needs – not Whitehall edict – and can also save cash in the process, by avoiding the sort of silo-based duplication of work and bureaucracy that often emerges when NHS bodies and councils, for example, provide similar services. Under Mr Pickles' blueprint, councils – and in particular directly elected council leaders – would play a key role in co-ordinating a wider range of public services than they do now. ‘I'm absolutely sure it's the future, because if you're going to empower neighbourhoods – as the prime minister has been talking about – then this is the way to go,' he told MPs. ‘This has the advantage that we're building on something the previous government agreed with and it has the advantage of being reasonably incremental. I've long come to the view that if you're going to change something in local government finance you need to keep a degree of stability.' Mr Pickles said he broadly accepted the Local Government Association's claim that a devolved, place-based budgeting regime could save the public purse around £4.5bn annually. But he added: ‘Even if we weren't in difficult financial times, I'd be very attracted to this.' He also dismissed MPs' fears the CLG is not a sufficient Whitehall ‘big hitter', capable of ensuring cross-departmental ‘buy in' to placed-based budgeting that requires departments such as health and transport to loosen their grip over silo-based funding. Mr Pickles also defended the CLG from accusations that it had hit many poor areas hardest when it slashed area-based grant (ABG) settlements this summer. He told MPs that he has minimised the impact on most localities and that cutting unallocated ABG was easier, and less controversial, than slashing revenue support grant (RSG).

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WHITEHALL

Pickles gives CSR hint on place-based budgets

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