Over the summer councils have been doing their maths based on the Chancellor’s announcement that they would lose a further 10% of their budgets from 2015.  The picture is not a good one.

Why? Although council’s have had their government revenue cut by 33% in this spending round and council workforces reduced by an estimated 150,000, services have by and large been sustained.  Councils have, in effect, delivered for the government.

To the average person in the street not much may feel different – bins continue to get emptied, pot holes are filled, website are looking good and if you call the council there is still someone answering. But there are signs, such as that reported this week by the RNIB which is reporting large reductions in social care support for people who are blind (http://www.rnib.org.uk/getinvolved/campaign/socialcare/Pages/social-care.aspx).

Some areas will also have been library and swimming pool closures, possibly children’s and adult centres closing. Members of the public might have become aware of council buildings which are up for sale and that face to face services are only being offered in the main town hall buildings.

This has by no means been fun for council employees, many of whom have been or are on ‘at risk’ registers as a result of continuing cycles of service reviews.

In the summer the Local Government Association produced an updated Future Funding Outlook for Councils up to 2019/20 (http://www.local.gov.uk/finance/-/journal_content/56/10180/4057616/ARTICLE) and the outlook sounds like a BBC weatherman “more of the same”. Even taking into account rises in council tax, business rates, income from things like parking, and the extra income in NHS social care, funding will have reduced by about 27% in real terms by 2019/20. And of course demand for services is rising.

It is remarkable that there hasn’t been a greater public outcry about this, but then again perhaps not as that same public is highly conscious of council tax rates at a time when many households are watching the purse strings closely.

What is interesting though is whilst ministers often express their frustrations with local government, Whitehall also looks to local government to resolve some of its problems.

The transfer of some ‘social fund’ responsibilities from DWP to councils in April is a great case in point. The DWP’s social fund used to give out crisis loans, however cases rose to from 11,000 a month in 2006 to 34,000 in 2010 and the remote delivery system wasn’t working (https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/220189/social-fund-localisation-wr2011-ia.pdf). It was handed to local government to manage but at the same time the budget was cut by 40% (E.g. http://www.darlington.gov.uk/PublicMinutes/Cabinet/November%206%202012/Item%207c.pdf) in some instances, with councils asked to devise and implement better ways of working – which they have. I have yet to see an official review of the effectiveness of the new services, but many iNetwork members report that it is going well and that inappropriate claimants are being directed elsewhere for support if they require it.

How are councils doing this? Assessing people better, engaging people with credit unions, giving financial advice, providing with vouchers for the goods or food they require for local shops instead of cash, and so on. The people abusing the system are being weeded out so it goes to those in genuine need. In essence, local government has focused on an outcome of more financially capable people and used their local knowledge, skills and capabilities to good effect.

This is one of the reasons that the call by Chairman of the Local Government Association for a “Rewiring of Public Services” is being welcomed by so many (http://www.lgcplus.com/news/speech-by-sir-merrick-cockell-to-local-government-association-conference/5060528.article).

But the settlement is what it is and councils need to work on that basis. So what are councils having to think about doing? All the relatively easy stuff has or is being done.

Now that colleagues are back from the summer en mass, this is stuff of quiet conversations. Given that local elections are next year it is unlikely much will surface until after they are over, although plans will be being drawn up by diligent officers. These are likely to include more of the same but at a more dramatic level – unfortunately services will go if they are not statutory, and if they are statutory they will become available to fewer people with perhaps a reduced quality through fewer locations.

The ray of hope is in focussing on better outcomes for individuals and families through intensive interventions that reduce demand on the public sector.  However this is difficult for a number of reasons including who pays for what, who know what about whom, who does it, and how.

Can we innovate our way out of this? It was interesting to see in a New Local Government Network (http://www.nlgn.org.uk/public/2013/can-local-government-innovate-its-way-out-of-the-cuts/) report recently that 90% of councils believed that innovation could enable at least 20% of their target savings. However 70% of the councils that replied felt that they lacked the time to focus on

This doesn’t leave us in a good place. It is clear that a diminished local government is bad for residents, but also bad for the public sector’s ability to innovate at all and find solutions to the social fund type issue.

Charles Leadbetter, the noted business author, highlighted part of the answer when he said that, innovation isn’t a product of “special people in special places”. It is a collaborative activity often serendipitously arrived at through seemingly ad hoc discussions and idea sharing. This is something we believe in passionately at iNetwork and see happening through the groups and networks that we help and support.

It also requires the whole organisation to engage and individuals be given space and automony to do so with a common sense of purpose. In my humble opinion, those councils that continue to serve their communities best will be those that look to their staff, that they worked so hard to recruit, and collectively consider the art of the possible.

Our winter conference “Delivering Whole Systems Change” on 27 November (http://wholesystemschange.eventbrite.co.uk/) will, we hope, provide some inspiration and a chance for colleagues to take stock. Also take a look at www.i-network.org.uk to see what else is going on or drop us a line.

Phil Swan, iNetwork