With the spending review completed and the annual financial settlements for local government across the UK done and dusted, we now know where budgets broadly stand, between now and 2020 and it’s taking local government expenditure to its lowest percentage of GDP since 1948.
The move to four year budgets in England will see significant further pain, on top of that already experienced, over the next couple of years, before a stabilisation in the latter years of that settlement. This of course optimistically assumes that there will not be a further recession during this period, high levels of house building will be achieved and the move to localise business rates will run smoothly and fairly.
Scotland and Wales are still working on the basis of annual settlements, which equate to a 3.5% cut and a 2% cut respectively. We also know that local government expenditure across the UK including Northern Ireland will have fallen by 30%, between 2010 and 2020. Local government has never before experienced this level of cuts over such a short period of time.
The social care precept of 2% of course helps but it doesn’t address all of the growing demand and those non-statutory liveability services that have taken so much punishment over the last five years will not gain from the precept that is ring-fenced to social care.
Fortunately, many of those involved in delivering neighbourhood level services have taken APSE’s advice over the years and developed programmes to become more commercial and entrepreneurial in their approach. Of course services that are highly efficient and effective are much easier to sell in a competitive market. Therefore, the starting point has to be eradicating waste to ensure services are designed in a way that provides the utmost value for money.
Our commercialisation network and on-going research in this area brings together some of the frontrunners on this agenda like Nottingham, Oxford, Harrow, Sevenoaks and West Lindsey. The people who work in these frontline areas don’t give up easily, with people and skill sets emerging that services didn’t even know they had. From municipal energy companies to cafes in parks, and all the way through to new investments to generate income from retail shops, petrol stations and even film studios, councils have proven time and again that they are prepared to be innovative in bridging the increasing funding gaps.
This emerging culture of commercialisation and the reawakening of a spirit of municipal entrepreneurship will be vital in the battle for financial survival.