Changing nature of risk
The NAO report last week – Digital Britain 2 – identified the increasing need to ensure people without internet access are not excluded from the move to digitalised public services over the coming years. Although the NHS, local councils and the Police are not yet included in the public services identified for online evolution, the move to a 24/7 digital Britain is surely only a matter of time for today’s local authorities.
The launch of the Transition Challenge Award, encouraging councils to team up to deliver frontline services, highlights the growing pressure councils face to make efficiency savings. Incentivising councils to become ‘super savers’, the award makes extra credit available for those that go even further in delivering services for residents through shared operations and management structures
This week’s NAO report provides a stark insight to the varied impact of government spending cuts at a local level and the increasing concern of financial failure – a risk that we ranked as having a high likelihood in 2010 in our ‘Tough Choices’ report. This means local authorities face a precarious balancing act; forced to make spending reductions while maintaining their obligations and prioritising services required by their local residents.
Against a new policy context of opening up public service provision, recent reports by Localis and the CBI provide further evidence that outsourcing in the public sector is here to stay. The days of core council-provided services are at their end and instead local authorities must work collaboratively with private and voluntary sectors as they seek the best route to provide services to and, in some cases, with the community.
Last week Sir Merrick Cockell warned that cash reserves for even the most prudent of councils will run dry within five years. The LGA’s latest data shows that at present councils hold £17bn of reserves and worryingly some have had to reduce their levels over the past year. However of most concern is the changing priorities for how reserves will be spent. Several councils it seems are now forced to use their reserves to cushion the blow of the cuts and continue providing key services
Last month, the schools shortlisted to receive funding under the Priority Schools Building Programme (PSBP) were announced, marking a further development in an educational landscape which has seen significant recent change. This news means that 261 schools will be rebuilt or refurbished from a £2bn PFI budget whilst 42 of the highest priority schools in the programme will have access to £400m of capital funding to meet their immediate needs
The Government last week published an update to its plans for open public services, injecting flexibility into local services through increased choice among individuals and greater competition among providers. According to the paper, the new public services agenda is here to treat citizens as “grown-ups – by giving them greater choice and control; genuine information on outcomes; and a stronger role for their communities”. Central to this is the Government’s call for evidence to see ...
The good news is that official figures for January suggested that the UK’s public finances were in the greatest surplus for four years, following a fall in local government borrowing and a rise in tax receipts. However, it seems confidence among local government finance offices is less than upbeat for the medium term future, as The Chartered Institute of Public Finance and Accountancy’s (CIPFA) latest poll of local authorities indicates.
Last week’s joint Audit Commission and LGA report ‘Work in progress’ raises one of the most pressing issues for local councils at this time: how to deal with workforce rationalisation in an effective, fair and sustainable way.
According to the Audit Commission’s annual fraud survey, a total of £185m of fraud was detected by local councils during 2010-11; a figure described as, “the tip of a very large iceberg”.