Investment in councils, investment in communities

I was invited to speak to the WLGA conference about “investment in councils, investment in communities”, and what follows is a very slightly abridged version of my comments on that topic; outlining how evidence can support councils in navigating the challenging situation they face.

The multiple challenges facing councils

The theme of this session is investment, but I wanted to start by acknowledging the really challenging situation that councils are in.

Because there’s no doubt that across Wales, councils and their communities are facing a daunting set of challenges.

The impact of inflation, still above 6%, is profound, and it will continue to be so.

The Office of Budget Responsibility is projecting that by the end of this year we’ll have seen the largest drop in living standards in the UK since the ONS started collecting data in the 1950s.In Wales, this hit to living standards is falling on communities that, for the last 20 years, have had at least a fifth of their population living in relative income poverty.

At the same time, we are still dealing with the legacy of COVID – most obviously in the health and social care system, but also in schools. Much has been said about the disruption to learning but I’m increasingly worried about pupil absences.

In the last school year, 18% of pupils were persistently absent – meaning they missed at least 30 days of school – equivalent to missing half a term of schooling.

For the most disadvantaged pupils, that figure was almost double – 34% of those eligible for free school meals were persistently absent.Alongside supporting communities to navigate these recent and ongoing crises, we need to see investment that will support wellbeing into the future.

Most notably we need to see significant investment if we are to avoid the most disastrous effects of climate change. Many still see this as a long term challenge, but any plausible scenario for achieving net zero requires action now, and at scale.

And this is not just the new energy schemes that are vital. It is also investment that supports behaviour change. The UK’s Climate Change Committee has said that over 60% of the emissions reductions needed require societal and behavioural change. Councils play a crucial role in shaping how people live and work, and how easy or difficult it is to choose the low carbon option.

Of course, wider investment in infrastructure and in the public realm is also needed. While the recent headlines have been about RAAC, the need for capital investment extends beyond dealing with crumbling aerated concrete.

If that weren’t enough, this set of issues, and associated investment needs, is hitting the UK at a time when resources are constrained, and resilience is, arguably, at an all-time low.

While local government in Wales has seen real terms increases in funding since the pandemic, local authorities still receive less than they did in 2010, and recent evidence points to significant deficits over the next two years.

One aspect of this that doesn’t get much coverage is the impact on those working in the sector.

Austerity, inevitably, led to a decline in head count as councils sought to cut back.

Five years ago, there were some in the sector who would say, privately at least, that this was welcome.

Now, the consistent message I hear is that those working in the sector have been in crisis mode since the pandemic hit.

Time and headspace to deal with anything beyond immediate firefighting is severely limited, and the risk of burnout is high.

Sadly, I see little hope that this situation will dramatically improve in the near future.

Over the next few years, the economic outlook for the UK as a whole will mean limited government revenues and limited scope for borrowing, and therefore limited scope for increased investment.

So, councils face huge challenges, and incredibly difficult decisions about what to prioritise, and therefore where to disinvest.

The question is then what are the best ways to manage disinvestment.

What do we know about managing with less?  

If there were a silver bullet, councils would have already found it.

But we can look to research to provide some insight to guide the difficult choices that councils need to make.

In part, this is because, while the current context is unique, councils have been coping with cuts for many years now.

They are well versed in managing the inevitable trade-offs and tricky choices this involves.

So, what do we know about how to navigate this?

In 2019, my colleagues at the Wales Centre for Public Policy conducted research into how councils in Wales had responded to the austerity agenda up until that point. This work highlighted three broad types of strategy that councils can take in response to reduced resources:

  • increasing efficiency
  • targeted investment
  • renegotiating the boundaries of council responsibility.

On the first of these, increasing efficiency, all I’ll say is that we concluded five years ago that the scope for further efficiency savings was minimal.

As for the second, what we mean by targeted investment is prioritising investment in those things that can help to alleviate pressures and improve outcomes – investing in things like preventative services, and in measures that will boost economic activity.

The final type of strategy – renegotiating the boundaries of councils’ responsibilities – at its most extreme means withdrawing so that only statutory services remain, and even these are paired back, either in volume or in quality.

But this type of strategy also encompasses ways of redefining the relationship between citizen and state and fostering collaboration and coordination between organisations.

Of course, these three types of strategy are not mutually exclusive, and councils will likely need combinations of all three.

But there are very different ways of pursuing them, and my colleagues identified more or less effective approaches. The more effective approaches were those that had two key features:

Firstly, a long-term strategy that is based on a clear purpose and set of priorities. This might sound like a statement of the obvious, but deciding what to prioritise also means deciding what not to prioritise, and therefore where funding has to be reduced or withdrawn.

Secondly, more effective approaches are those that adopt practices designed to improve the way the local government does things, so:

  • making deliberate efforts to learn from evidence about what has worked elsewhere
  • collaborating with others
  • trying new ways of working
  • consciously focusing on the organizational change and development that might be required to support this change.

Of course all of this is easier said than done. But it is possible and it is worth aspiring to.

Investing in collaboration, both with communities and with wider partners  

I’ve talked about the challenges as I see them, and the incredibly difficult decisions that these create. And I’ve talked about some of the strategies that you might adopt in thinking through how to respond.

I wanted to finish by talking about a couple of areas that we are working on with partners in local government and other public services that speak to the challenges and potential strategies that I’ve described so far. And which will, I hope, be useful to you and your colleagues.

Firstly, our work has highlighted the importance of councils working in genuine partnership with local communities.

Our recent work on tackling poverty highlighted just how far public services sometimes fall short of joining up around the needs of the most vulnerable.

For those struggling to make ends meet, transport, housing, childcare, and employment opportunities are all linked issues, but the funding and services available are not designed and delivered in a way that reflects this.

Involving those with direct experience of living with poverty can have a transformative impact. We can see notable examples of this happening in Wales, which demonstrates what is possible.

Similarly, the work that we’re doing on climate change and net zero shows that individuals and communities need to be involved in developing and implementing solutions.

And we have seen that councils can create the conditions for this. Our research on volunteering and community action during the pandemic highlights the vital role that Councils and the WLGA played. We should be learning from that in trying to mobilise communities to tackle climate change.

The second area that I wanted to talk about was collaboration.

In trying to work out how to manage the financial pressures being faced, there’s a natural temptation to look inwards and pull back from collaboration.

Our work on multi-agency working has taught me that so much of the collaborative activity that people undertake is seen as additional to their day job. Not because they don’t care or don’t see the value of it, but because their ‘day job’ is to meet their own organisation’s objectives.

And yet, a consistent theme across all of our work has been that if you want to tackle the big issues, there needs to be coordination and collaboration across departmental and organisational boundaries.

Again, the pandemic showed the potential for agile collaboration. I suspect a shared objective and prioritization of this at all levels of society made that somewhat unique.

But I get the sense is that, in Wales, there is a shared objective around tackling the cost-of-living crisis

I’m lucky in my job to be able to speak to people from a range of sectors and across a range of policy areas. The cost of living is a top priority for everyone. To my mind, this creates a similarly unique opportunity for collaboration.

But we need to hold on to the learning from the pandemic, and permanently change the way that organisations work together on shared objectives.

Collaborate with us

In closing, and on the theme of collaboration, I wanted to say that my colleagues and I are keen to work with the you to help play our part in addressing the big challenges facing communities right across Wales.

As I said in my brief intro, the Wales Centre for Public Policy is funded by the Economic and Social Research Council to support public sector leaders to navigate the challenges that they face by collaborating with them to understand the issues that they are grappling with, and by bringing together the best available evidence and expertise to help to chart a path that reflects international best practice but which is also rooted in local context.

And if you’d like to know more please do speak with me or one of my colleagues or you can contact us through our website where all of our work is available.

Diolch, thank you