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Local Government Reorganisation after Covid-19

15.06.2020
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Local Government Reorganisation (LGR) is on the minds of policy makers in central government, again. But it is also on the minds of some in local councils who need a solution to significant distress!

The shape, size and configuration of local government has been a debate since before I started working in the public sector. I was fortunate enough to be able to support Wiltshire create their new unitary in 2008, but I didn’t appreciate the significance of the change at the time. More recently, we at Ameo have helped support many councils, both district and county, to understand their options, which has led to us supporting 2 successful transitions over the last 18 months. And now, over the last few weeks, the debate seems to be gathering momentum and we find ourselves in many more conversations about LGR. But is this LGR as we know it?

Over the years, what has struck me has been the broader opportunities that emerge prior, during and after transition over and above the case for change. However, people are people and, a decade apart, the behaviours and associated challenges of change have very rarely differed. When we typically talk about LGR, many often jump to unitarisation. However, this next phase of LGR could be a lot more significant than any of us have imagined.

Covid-19 has exposed the challenges that exist within our system and has put huge financial pressures on all councils. This has posed the question whether some councils are sustainable in their current form? Are they constructed on the right footprint to capitalise on local community knowledge and capacity?  As local government grapples with the financial challenges posed by Covid-19, some of the challenges we need to tackle are:

The health and adult social care conundrum.

There has been some amazing work between health and social care as a response to Covid-19, standing up service integration within weeks when usually it would have taken years. We sense that this will force the hand of government to address this in the longer term. Do we look at social care moving under the NHS or separate entities moved out of LA control (perhaps a health and social care board, as is the case in Northern Ireland)? I can’t see this area of the system being left untouched. This is usually around 45% of top tier councils spend, so it starts to challenge the role of local government in its entirety.

Driving the economy.

The socio-economic impact of Covid-19 is obviously huge. A priority for the government will be the economic stimulus required to help mitigate the impact. But, arguably, this will only be effective on a large enough scale. The question that faces government around this is whether county footprints are big enough or do they move to a regional model and utilise combined authorities, develop regional planning bodies? There is also the question of the role of Local Enterprise Partnerships. Scale to start large infrastructure projects will be key to the economy but it remains to be seen where their investments will yield the best returns.

Role of the communities.
Against the backdrop of regional stimulus, the importance of local knowledge and communities has been highlighted in the response phase. Determining the scale at which this works is something the government will be grappling with. District level is possibly too local and focused on very local issues but counties are geographically too big.

Children’s demand.

We recently completed a LAC review for a large county client. Supporting them to complete their needs analysis, we were able to identify the approximate number of children in the system prior to Covid-19. We finished the work as the pandemic struck and we now accept that the previous estimate is too low. There is potentially a growth of 25%. Children’s Services is already underfunded with many being forced to move to a Trust and with a complex provider market. The question is whether this model is sustainable.

If we look at these points collectively, we begin to question whether Local Government is fit for the future and this potentially points towards genuine reorganisation on a massive scale.

This is not simple, and questions still remain, such as how do you accomplish this when also responding to a global crisis and the impending financial crisis looming? We are all assuming an emergency budget in July, which should start to provide some insight. The whitepaper on Devolution should provide a clear policy direction (we hope). However, as we know, government doesn’t always provide clear policy direction and perhaps it is for all of us to find solutions that meet with our regional needs. There is no debate that the current model is unsustainable but perhaps the answer can come from the sector with some innovative thinking.

Ameo is a specialist transformation partner who support major structural reform across the country, helping to develop the cases for change but also helping to drive delivery of new organisational forms.

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