Paul Bradbury says research shows council chiefs and leaders are thinking the unthinkable as they grapple with the budget downturn.
We've heard about some of the intended cuts – and the timeframe. So, can the Government balance the public finances in one parliament without decimating services? Insights from senior managers and supply side experts recognise the difficulties ahead, but also highlight the innovative thinking now addressing this situation.
CIPFA has voiced early concerns over the 22 June Budget, suggesting that balancing the books in one five-year term is ‘very ambitious'.
Its warning draws in part on responses to its sector-wide survey of finance directors in April*.
Among the difficult choices for rebalancing public finances identified by respondents were – reorganising national public bodies (chosen by 64% of interviewees), closer collaboration between public bodies (61%), reorganising local bodies (54%), and reducing the range of state funded services (43%).
The survey suggested a tough time for frontline management and workforces. Asked to name the most likely practical cuts or efficiency measures, redesign of services (63% of respondents) was narrowly ahead of cuts in back-office/support staff (62%).
However, no service area or function seems safe – almost half of respondents (49%) expected reductions in management/senior staff and almost as many foresaw cuts in lower-priority services (47%).
Steve Freer, CIPFA's chief executive, says: ‘Many of the ideas favoured by finance directors are structural. They require significant re-engineering of organisations, systems and processes. A key challenge will be to make these kinds of changes happen to tight timescales, despite reduced capacity.'
CIPFA's research also highlighted differences over strategic moves such as Total Place and shared services. Asked about the outcomes for integration of public services, 62% of respondents said they promoted better co-ordination and collaboration, and 51% felt it would cut waste and duplication in local services. However, only 25% said this would improve working between central government and local bodies.
Mr Freer says: ‘Finance directors get the imperative of protecting frontline services, and can see the high potential role of significant collaboration initiatives. But, there is understandable concern about the complexity which so often comes with working across organisational boundaries. The challenge, frankly, is to use the urgency of the current situation to cut through some of the usual problems and resistance.'
Survey sponsor Civica's ongoing engagement with senior executives revealed a similar picture. It said that senior management was contemplating the impacts of large-scale operational changes and innovations, having anticipated and begun serious planning for budget cuts – as high as 25% – from last year.
The company observed chief executives' commitment to connecting with the policies determined by their elected members, through their delivery and commissioning. Many chief executives were concerned both by the prospect of providing statutory services with greatly-reduced money and managing their workforce to accept new priorities and ways of working. Chief executives were also worried that the Government's drive for efficiencies could lead to reactive decisions without aligning with local priorities.
