Whole Place Community Budgets….or how to organise your public service…

March 15, 2013

A recent report to members of the House of Commons in the United Kingdom suggests that:

Community budgets are a way of bringing different national and local funding strands together into a single local funding pot and, by doing so, enabling various different agencies covering the relevant subject to work together more effectively.

Such budgets have being piloted to determine whether it is possible to break down overpowering central departmental barriers and actually deal with the cross departmental realities of day to day lives of most ordinary human beings.

This unique realisation that people do not organise their lives along departmental lines or policy silos may seem incredible to those arguing for increasing the thematic organisation of public services on a centralised basis but the evidence is increasingly suggesting that, in the UK at least, considerable savings can be delineated though models such as community budgeting.

A report for the Local Government Association in the UK suggests savings of several billion of sterling on an annual basis, amounting to an addition saving of almost 6% on total local spending across those public bodies, national and local delivering services which more correctly should be delivered within a territorial framework rather than a thematic framework.

So what are community budgets?

The Open Public Services White Paper issued by the British Government in July 2011 made it very explicit that “The old, centralised approach to public service delivery is broken…Too many of our public services are still run according to the maxim ‘the man in Whitehall really does know best’.Decades of top down prescription and centralisation have put bureaucratic imperatives above the needs of service users, while damaging the public service ethos by continually second-guessing highly trained professionals…”

The White Paper sets out five key principles behind the re-configuration of the British Public Service:

• Choice – Wherever possible citizen centred choice will be increased.
• Decentralisation – Power should be decentralised to the lowest appropriate level.
• Diversity – Public services should be open to a range of providers.
• Fairness – We will ensure fair access to public services.
• Accountability – Public services should be accountable to users and taxpayers.

Public service should be configured around meeting the needs of the individual, the community as well as having services that might be national in nature but which should be delivered directly to the citizen on a platform as close to the citizen as possible.

Applying such an approach calls for the designation of minimum levels of service quality while also ensuring maximum budgetary effectiveness. The platform for doing so is through community budgeting which is informed by local need but placed within the national policy context. This, the Paper sees as the local authority and other public services involving communities, local partners and providers to decide collectively how to get the very best outcomes from the resources available.

The concept of Whole-Place Community Budgeting focuses on all funding on local public services being determined within a community based operational environment rather than through the individual business planning of state and local agencies.

In broad terms it means:

• identify opportunities for genuine service transformation across organisational boundaries;
• better develop services around the needs of people in the local area, with a more integrated offer for users, especially those with complex and multiple needs; and
• identify efficiencies through collaborative working and redesigned services.

Lessons from the pilots undertaken to date suggest not just real savings in public spending across departmental lines but also:
• improved outcomes for citizens – by focusing on important local outcomes, such as preventing avoidable hospital admissions or reducing reoffending;
• more cost-effective delivery – by stripping out unnecessary or unhelpful duplication, such as different bodies undertaking multiple assessments of people or families;
• improved access to resources – by combining budgets, skills, staff or data to address barriers to joint investment, for example where one body spends but another benefits, or when it takes time for benefits to accrue; and
• Creating clearer incentives to deliver more cost-effectively – for example, by changing how local services get central government funding.

One of the key lessons, which is almost becoming a mantra at this point, is that there is no reason to believe that the management of local expectations cannot take place within a territorially determined policy environment under local leadership. This has the added benefit of freeing up the centre to drive the national policy process and to evaluate the performance of the local level, something seen as a “normal” role for central governments pretty well everywhere in the OECD other than in the UK or Ireland.

More significantly is that the focus on improved public service becomes the local policy driver which unsurprisingly generates savings beyond those being achieved through internal structural reform within silo-organised service delivery. Budgets based on local expectations, generated in part at local level as well as co-financed by national budgets can be very effective in controlling public service excess. This is a norm in most OECD countries and, it appears, will become so in the United Kingdom.

The process of place based community budgeting therefore could be of considerable interest to Irish policy makers as there are clear parallels between the challenges confronting the UK and Ireland. Breaking down barriers and institutional tiers is as much an issue in Ireland as would be the case in the UK so hopefully some people are reading the flow of reports which suggests that this might just be a vital tool in the move to control expenditure whilst ensuring public service delivery across the State.