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The limits of sharing

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Today three councils in London have announced details of a plan to share services. The councils, Hammersmith & Fulham, Kensingston & Chelsea, and Westminster are all Conservative-controlled (for now - H&F could go Labour at next election) and have been lauded by ministers as beacons for what councils can do to protect the frontline.

Housing minister Grant Shapps compared the tri-borough proposals favourably with Manchester City Council’s announcement yesterday of where its £279m in cuts will fall over the next two years. He said Manchester’s announcement was a “cynical move by a Labour council intentionally cutting frontline service and playing politics with people lives”.

Bold plan or small beer?

It is unfortunate, albeit predictable, that ministers have chosen to politicise local government cuts in such a crudely partisan way. Not least because it misleads the public and prevents sensible debate about the very difficult decision town halls are having to make, right now, about the future of their services.

In Grant Shapps’ world, it would seem, only a cynical Labour council would cut their frontline services - and would do so out of spite. But back in the real world, every council, no matter what its political hue, is facing difficult decisions about which frontline services to cut - including the three London boroughs Mr Shapps so lauds.

For what is most revealing about the tri-borough proposal is how little it will actually save the three councils involved, relative to the extent of the cuts they are being asked to make. Indeed, as the document published today sets out, the councils expect the plan to save, between them, £34.6m by 2014/15. That’s around £8.65m per year across the three boroughs, which equates to just £2.9m per year per borough.

When compared to the £212m in cuts the three councils are facing over the next four years (to formula and specific grants)- a reduction, allowing for inflation of 31% - the limits of sharing, as a means to deal with the new austerity and protect services becomes apparent. The “bold” plan hailed by Mr Shapps actually only saves the councils around 16% of what is needed. Valuable savings of course, but small beer.

All in it together

This is not to say the shared services plan is not to be applauded: it most certainly should be and many other councils will surely follow suit. Rather it is to inject a little reality into the shrill tone of the debate around the decisions councils now have to make and to give lie to the assertion, constantly repeated by ministers, that councils can protect their frontline services from the impact of the worst settlement in decades (for a dose of this partisan silliness, visit Harry Phibbs’s blog at Conservative Home) . Indeed, as the document published by the three boroughs today makes clear, the “budgetary pressures” that the councils face “will undoubtedly impact on frontline services”.

In fact, Westminster has already announced £50m in cuts to the frontline, hitting some of the borough’s most vulnerable residents - and is slashing its Supporting People budget by £1m despite ministers’ exhortations that SP should be protected. As Melvyn Caplan, Westminster’s cabinet member for finance said on announcing the cuts: “No one wants to cut services, but previous levels of spending are simply unsustainable and like or not we simply cannot afford to do all the things we used to do”.

A statement not dissimilar in tone to that made by Sir Richard Leese yesterday, yet Manchester’s cuts are branded “cynical” and “political” by ministers whereas Westminster’s are ignored. And it can’t be because Manchester is not trying to be innovative and bold. Indeed, as part of the Greater Manchester combined authority, Manchester is already going where no council outside London has gone before: into a statutory vehicle that will genuinely pool accountability over some key service areas.

Furthermore, as part of the city region partnership - and with councils of all hues - they are exploring options for merging services across ten core areas, with an estimated £116m to be saved by 2013/14, which when realised will put the London tri-borough plan into the shade. Not that Mr Shapps would admit this - or perhaps, even be aware of it - as it’s the kind of story unlikely to feature in the Daily Mail. If the minister were a little less shrill and prepared to listen more, he might learn something - then so to could the public.

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