PLC Public Sector reports:
The challenge of achieving efficiency savings without impacting on public service delivery is one that public sector workers have been facing for some time. Budget 2009, with its call for an extra £15 billion of efficiency savings, means that the task of finding the right balance between these 2 competing needs will become even more difficult.
One of the headline initiatives for local government formally announced in the budget, was the creation of 2 pilot city-regions. Manchester and Leeds have been given the go-ahead to take more control over their budgets and, presumably, more responsibility for striking the right balance between service delivery and efficiency. Is this the start of the long called for decentralisation, or is this pilot, which will be “overseen at ministerial level”, just window dressing?
To add a third dimension to the melting pot, recently, the Government has increasingly sought to use the public sector’s £175 billion procurement spend to help achieve policy objectives. As BERR states in its recent paper New Industry, New Jobs, “this procurement can have a powerful role in shaping markets, with the potential to drive new technologies, skills and processes.” There is no doubt that £175 billion is a great deal of money. However, the Government is clearly expecting a lot of bang for its buck. As well as shaping markets, driving new technologies and so on, among other things, it also wants the spend to:
- Improve the skills of a nation.
- Address social, equality and green issues currently affecting the country.
- Push through the Government’s apprenticeship agenda.
These are all worthy aims and, of course, public money should be used to deliver as much as possible. However, to achieve all of this, while at the same time saving money and not impinging on service quality, will undoubtedly be a challenge! The budget and the New Industry New Jobs paper seem to acknowledge that the Government cannot deliver this type of change or the level of efficiency savings sought when controlled from the centre (whether through procurement spend or otherwise).
One of the solutions the Government has proposed to address this issue are the pilot city-regions. Challenged with supporting “greater economic development and business engagement” the city-regions will work with the Government “to develop proposals for new strategy-setting powers over adult skills funding … new joint investment boards with RDAs, the Home and Communities Agency and other partners to coordinate and align investment and pilot new employment programmes”. This all sounds very important, but at this stage, we do not know what it will actually mean.
Combined with the £1 billion promised for local authorities through the Future Jobs Fund, the Government’s acceptance of LGA proposals to “recycle” buildings and the funds allocated to the Total Place programme to co-ordinate the drive for efficiency, the signs are promising. It could be that local government is being given the opportunity to show how it can really make a difference in dealing with the recession. However, the jury is still out, with the fear being that the thrust of some of these new initiatives could be the centre simply reaching down to squeeze out more efficiency savings from local government, without actually relinquishing any control. If this is the case, the risk is that front line services may suffer.
For the time being, while the signs are promising, maybe the question in the title to this post should be changed to “Will city-regions be given the chance to provide a solution?”.