Councils have it hard.
The Local Government Association has estimated a funding gap of £5.8bn by 2020. The Social Market Foundation’s latest report, Local Public Services 2040, points to a fall of a quarter in the local government workforce this decade and borrowing on the rise.
Things are not set to get any easier over the next two decades. The over-75 population is set to grow by 89%, putting huge pressure on the health and social care services. Expectations of public services are likely to rise. Environmental risks are likely to intensify. The strength of the local tax base will increasingly determine the resources that councils have to play with, whilst disparities across regional economies may well continue.
It is easy to be gloomy about the future role of councils but this is to ignore some huge new opportunities, responsibilities and roles for local government over the coming years. Our report sketches out five possible future models:
- ‘Industrial Councils’ – large councils with stronger tax-raising powers, with their own muscular business departments. Such councils would play important roles in addressing local market failures in, for instance, digital and communications infrastructure, and re-skilling the population for the technology revolution.
- ‘Ofcouncils’ – Funding pressures may steer councils to pursue social and economic objectives through regulation rather than service provision. Concerns over safety, affordability and tenure rights may see councils do more to regulate the private rented housing sector. Ethical questions and new risks around emerging technologies such as driverless cars may require councils to act as arbiters and regulators.
- ‘Tech opportunists’ – Tech is often viewed as leading to less human services but in healthcare, devices and apps that help monitor conditions can help individuals live much more independently at home and with their family. In social care, robots could be used for basic activities efficiently, leaving carers to devote more time to human interaction.
- ‘Community Councils’ – In a more atomised society, councils will seek to address the growing shortfall of family carers through networks of intergenerational support. Steps to promote community integration will also help prepare areas to respond to external incidents such as floods or disasters and counteract the threat of social disorder.
- ‘The Commissioning Council Revisited’ – Drawing on experiments already underway, councils will prioritise the role of local market-makers and look to financing methods such as crowd-funding that engage citizens in prioritising and funding community projects.
These are just some potential visions of the future, in a world where diversity and innovation will be greater than ever.
Nigel Keohane, director of research, Social Market Foundation