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As local government faces the daunting task of meeting cuts, The MJ and Pitney Bowes Business Insight gathered some of the country's leading chief executives together toa look at the future of the transformation agenda. Heather Jameson reports on the discussion which was also webcast on Localgov.co.uk The challenges of the transformation agenda have been with councils for some time now, and pre-date the change of government and the cuts made in last month's Comprehensive Spending Review. But the big question is, has the new Government and its cash-cutting policies pushed councils into working harder and faster to meet the challenges ahead? For Graham Burgess, chief executive of Blackburn with Darwen Council and, unusually, also chief executive of the primary care trust (PCT), it is easy to see his authority has already started to make changes to how it works, and move a step closer to joined-up public services in the locality. He claims integration of the two bodies will save between £4m and £4.5m. ‘It would have happened, but it would have been far more slowly. There is no doubt that the financial pressures on both sides, on the PCT and on the council, have been driving the integration.' Mr Burgess is looking to work with neighbouring authorities, as well as trying to create ‘some sort of public service administration' in the local area. He admits that the workforce is a ‘major barrier', particularly with health sector staff, who have far better terms and conditions than their counterparts working in local authorities. ‘Those things can be a real barrier to integration,' he adds: ‘It doesn't stop integration, but it makes it that much more difficult.' As far as Mr Burgess is concerned, there are other opportunities to work with other pubic sector bodies in the area to make further savings – from the police to local colleges. But, he says, it will need the Government to push other bodies into this. Gloucestershire CC chief executive, Peter Bungard, says he has faced a ‘continuous journey' from the days of Gershon efficiencies, six to seven years ago. ‘For the past two to three years, expectations on public services have remained huge but the money has not.' In a bid to keep things going, and to avoid cuts to frontline services, the transformation agenda has been trying to plug the gap. ‘We are entering a very different chapter now, and a much more complicated one. My gap is about 30% of non-schools budget.' In Gloucestershire's case, that adds up to about £120m. ‘I do not believe you can close that gap solely by keeping the efficiency machinery running.' So, where next? Mr Bungard says: ‘There's the challenge – do we have a mandate to make service cuts? I don't think we do until you can prove your own organisation is squeaky clean.' That will mean proving to the public the council has done everything possible to be more efficient. But, whatever happens in the next few years, he says: ‘The state will get smaller across most of the country – that is the reality.' Mary Orton, chief executive of Waverley BC, says the picture looks the same from the district perspective. ‘Districts are very much misunderstood by other tiers of local government. Certainly, the numbers are different, but the percentages and the magnitude [of the cuts] are the same.' Her authority had been budgeting on 30% cuts long before the Comprehensive Spending Review. She was appointed with a mandate to get the council out of the situation where it was ‘living on our savings', and that is what she has done. It has involved three years of engaging staff in constantly thinking about how they can save money and how they can do things differently. ‘A year ago, we took a brave decision – we cut our senior management team from four directors to two, but for one year and one year only, we recruited a third one, with a mandate to save us £1m on a £15m base. We got in someone from the private sector, with a track record in management consultancy – totally new to local government … and he has done it.' However, Ms Orton is confident Waverley will be able to make the savings it needs to. ‘You have to be an eternal optimist, or you wouldn't be in the business of providing public services.' For Hackney LBC chief executive, Tim Shields, the transformation agenda has been going on for years – but it has speeded up, due to the financial imperative. The council has been working to bring all its customer services together in one new building. ‘It's had an enormous impact on customers coming in.' They are being seen quickly, and services are more joined up. The authority is now looking at what other things it can join together to make applying for council services simpler and easier. There has also been a big impact on the way council staff work – from hot-desking to a paperless office. ‘It's taken years to get this – but the benefits have been huge.' But it was not a cost savings agenda which has driven this – it was a focus on customer services. And it has taken a long time, with serious investment, to get Hackney where it is. Under Gershon, he says, the cost savings were re-invested. Under the new agenda, it's simply about cutting. For Andrea Hill, chief executive of Suffolk CC, this is an opportunity to set the record straight on her transformation programme. If readers were to believe some of the national media coverage, they would think her aim was to privatise the public sector in her area. She explodes some of the myths: ‘Suffolk is not actually outsourcing all its services to the private sector, we are not designing a council that's going to come down to 500 staff, and we are not designing a council that's just going to let contracts,' she says. ‘What we have got is a new strategic direction, and we are going to try to reduce costs by 30%.' Her figures are similar to Gloucestershire, which will require huge savings and, she says: ‘You can't do it by increased efficiencies.' Ms Hill says: ‘We have a different philosophy but is very much a practical philosophy. We think that government has got to get smaller. We think people want to take more control over their lives.' She cites the example of inspection. In 2009, councils in the area spent almost £6m on inspection. ‘That's a tremendous amount of taxpayers' money.' She claims the new Government ‘caused us to increase the pace of change and enabled us to increase the pace of change'. Suffolk is looking at all services and how they could be provided differently – everything from social enterprises, mutuals and co-ops to management buy-outs of services. ‘We think in Suffolk we have communities which are delivering examples of the Big Society, but they are just doing it quietly and they didn't know it was called the Big Society until the new Government came in.' For Haringey LBC chief executive, Kevin Crompton, his authority has been working to change on everything, from ‘intelligent budgeting' to ‘doing procurement better'. But, he asks: ‘Can we have a more self-sufficient society? ‘My problems are – transformation takes time, and transformation sometimes needs investment. The shorter the timescale, the more I will be under pressure to bank money.' And that is the key difficulty. With the Comprehensive Spending Review front-loading cuts into the first year, councils don't have either the time or the money to invest in transforming their services. And for Mr Crompton, the option of joined-up public services is not advanced in his part of London as yet. Ms Hill agrees: ‘You can't build community capacity fast enough to do transformation… we will be looking at stopping things.' Localism will kick in as different areas decide their different priorities but, she says: ‘We don't have any choice, we have to close the budget gaps.' Gloucestershire's Peter Bungard says his authority has started that discussion with its communities. There will be less money, so something has to give. With a smaller state, the idea is that Big Society will step in to plug the gaps. He expects ‘some successes'. ‘I don't think it's a panacea for all our areas…. There is a number of areas where I am worried - I'm not sure Big Society will be the solution.' You can view the Pitney Bowes Business Insight/MJ debate in full on line at: www.localgov.co.uk/cuttinginsight

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WHITEHALL

Tackling the transformation challenge

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