Wednesday, 21 March 2012

Local Spending Reports: value rather than price

Yesterday we had announcements about new annual tax statements purportedly designed to increase transparency about how tax is used to support public services. There have been some rapid critiques of that initiative: it is partial in terms of income source (only focused on direct taxation not on indirect taxes); it is partial in terms of focusing only on what is spent and not what is achieved; it makes public services akin to shopping as if this is down to individual decision rather than a collective investment.

In short, to misuse Wilde, it is all about price rather than value. 

There is a strong sense that the purpose of these reports is not about spending money better. Just about spending less. 

Local authorities already provide an account to council tax payers of how their money is used but it focuses on what is being done with the money and to some extent why. But it is partial - inevitably it only focuses on the responsibilities of the local authority.

What we have never had is a proper account of what is being spent in an area by the variety of bodies involved in delivering public services. We have had numerous initiatives from LAAs to Total Place and now Community Budgets which were intended to try to get a proper handle on this. None of these has ever managed to come to fruition, partly because its difficult stuff and partly one has to say because the will has never quite been there to push on the surmount the final hurdles. Sadly, I'm not exactly holding my breath on the whole budget Community Budget pilots either. But we'll see.

But there is actually a requirement for Government to be providing a much more holistic account of what is spent in particular areas.

Anyone still recall local spending reports?

These were part of the Sustainable Communities Act 2007 provisions which ended up as a hard fought compromise between a cross party lobby in Parliament and an Executive worried about a potentially unmanageable set of provisions. 

Section 6 of the SCA requires the Government to make arrangements for the development of LSRs. There was even a consultation on a second set of reports in 2010 about which absolutely nothing seems to have been heard.

Now that we have a Government with an apparently strong desire to push transparency wouldn't it be a good time to dust off local spending reports?

The purpose of LSRs in my view is that it might allow for some better understanding of the totality of public spending in an area but would also be the basis for improving value from how it is used. We say that we are genuinely interested in preventative action. Many councils and other organisations would say that this is one of the most creative ways of securing improved effectiveness from public spending. But the spend is fractured at the moment. The public have no clue that the majority of spend goes on the consequence rather dealing with the upstream causes or with interventions that might be more effective and a great deal cheaper.

But its all bedevilled by organisational boundaries and the ability to make progress is hardly being improved by some of the consequences of guided localism which is splitting things up rather than bringing them together.

So why not a push now from local authorities on really using transparency about full spend in local areas to make the case for more integration between budgets and more emphasis on prevention. To show taxpayers that their various contributions could secure better value. To engage in a discussion about making improvements in responsibilities and systems rather than moaning on about price. That would be challenging for councils and others: we know that there is very high spend on a small number of clients in some cases (indeed the 'troubled families' initiative promoted by the Government reflects this very point). 

But surely it has to be better than what we have now which on the one hand allows the local press and the famous armchair auditors to run often mischievous stories about minute bits of spending and on the other a narrative focused entirely on national direct taxation and spending.

Is the Government up for shining a light on how to improve the collective use of public spending at local level as well as every £500 spent by a local authority? 

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