Published:

Quite rightly one of the big questions the media will focus on in the General Election cajmpaign will be how to deliver the huge cuts in public spending required while protecting the key, front line services. This week's publication by the Centre for Policy Studies of the Magna Carta for localism, written about on this site by one of the authors Colin Barrow here, should have attracted attention. It was a report by three men who had proven credentials in achieving just such a formula for their local communities which is now so desperately needed on a national level. They have earned the right to be taken seriously and estimated that their proposals would save £13.9 billion. Yet so far the report has been ignored by the media. All the more reason to give it more attention here over the next few days.

The authors are conscious that councils do not automatically operate efficiently. Indeed just as Tony Blair has the "scars on his back" of failing to improve the way the public sector operated they have the scars on their backs of hard won successes. But they do believe that removing duplication makes sense. 

What of councils that are already failing? Here the authors qualify their localist enthusiasm by proposing the concept of Foundation Councils. The concept of Foundation Councils was first mooted by Edward Lister in a 1995 Centre for Policy Studies paper, Local Limits: cutting the costs of good councils. It was also more recently suggested by Councillor Sarah Gore, Cabinet Member for Children’s Services at Hammersmith & Fulham. 

The paper says: 

Just as Foundation Hospitals have been granted far greater operational freedom, so too could those councils which earn Foundation Status be given more operational freedom. This will save money and result in services which will be more effective and more closely attuned with the needs of local residents.

The report is not just about saving money but today I will start with focussing on that aspect. The savings come from the simple point that having the duplication of two authorities having responsibility for the same issue wastes money. The £13.9 billion estimated savings is rather cautious. This figures exclude the savings (estimated at £1 billion) from a simpler inspection regime. 

Here are the main areas for savings:

1. Local administration of benefits and tackling unemployment.

This approach could yield significant potential savings of around £4 billion a year. This is derived from:
A 10% efficiency saving on JCP and Skills Funding Agency programmes, derived from targeting overlapping programmes and management.
A 40% efficiency saving on other employment programmes This is an area with significant overlaps in provision and multiple tiers of contracting and associated management costs.

2. Foundation Councils would commission local health and social care services.

This would include long-term care services and services for vulnerable children. Rather than multiple organisations providing local health and social care services only the Foundation Council would commission these services. All other primary care and acute services would continue to be delivered by the National Health Service. Savings are estimated at £5.1 billion if implemented nationally.

3. Devolving policing.

Similarly, beat policing, combating youth anti-social behaviour, tackling troubled families and offender management could be devolved to Foundation Councils. Savings are estimated at £4.4 billion if implemented nationally.

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