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Whitehall given deadline to solve pooling problems

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Ministers have been warned they must make progress on public service reform in the next six months following complaints that pioneering councils had “hit a brick wall”.

Members of the communities & local government select committee have demanded “significant progress by central government” before next summer and called for “clear arrangements” to resolve problems between Whitehall and councils.

The committee’s report was published on Wednesday, a day after the leader of one of the four community budget pilots said his council had “hit a brick wall” in talks with the Department for Business, Innovation & Skills about devolving kills provision in Essex.

Essex CC leader David Finch (Con) called on chancellor George Osborne to create a “lock on localism” by “holding money back” from spending departments that chose to “hang on to their cash”.

While MPs accepted that local-central joint working “will not happen immediately”, they called for “significant progress by central government … over the next six months”.

They backed Essex’s calls for further funding announcements, recommending a “significant expansion in the use and scale of pooled budgets before 2015”.

MPs said they were “disappointed” at Essex’s difficulties with BIS and also cited Kent CC criticism of the Department for Work & Pensions’ skills team.

In contrast the report praised the £4bn pooled funding brokered with the health, education and other departments for social care and troubled families work.

“If communities are to reach their full potential to generate growth as well as improve services and produce savings, integration will have to go beyond those departments which have responsibility for social matters and the involvement of BIS will be key to this,” the report said.

Where councils had “problems with departments” there needed to be “clear arrangements in place to resolve those problems” such as a named official in each department to liaise with local areas, it said.

A Treasury spokesman said community budgets had shown “how more joined-up and efficient public services can save money”. He added: “Building on this, at the spending round we combined a number of budgets which will improve the joint delivery of public services.”

Local government minister Brandon Lewis said the public sector transformation network, made up of 27 secondees from central and local government and announced in July, would extend the work of the four community budget pilots.

The network is currently working intensively with nine areas, but Mr Lewis said it would work “all around the country as part of a rolling programme of intensive engagement and support for councils”.

Update 25 October: BIS were asked to respond and did so after the article was published.

A spokesman for BIS said there were limits to what could be devolved to local areas and emphasised that devolution would be to local enterprise partnerships, not councils.

“The government has been clear that it is right for aspects of the skills system to be administered nationally to drive reform and meet commitments to improve quality and minimise bureaucracy.

“As with other areas, Essex County Council should be working with the local enterprise partnership to develop and shape the local skills offer as part of the LEP’s growth deal and deciding how to use other funding such as the European structural funds.”

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